Creative Section 1115 Programs Address Heat-Related Hospitalization Costs and Other Social Determinants of Health

By Emilee Daniel

Extreme heat is leading to a health crisis in the United States. According to the Centers for Disease Control, 658 people die due to extreme heat every year on average. The number of people impacted by heat-related illnesses, like heat exhaustion and stroke, is even higher. American healthcare costs for heat-related and heat-adjacent illnesses are estimated to hit $1 billion per summer. Further, heat-related hospitalization costs are higher for Medicaid and Medicare recipients.

            States are getting creative to combat heat-related illnesses and hospitalization costs, especially for Medicaid recipients. For example, Oregon will begin offering free climate devices, like air conditioners and refrigeration units, to qualifying individuals starting January 1st, 2024. Five states and American Samoa offer cooling assistance through the Low Income Home Energy Assistance Program, but Oregon’s program has a different statutory basis.

            Oregon’s program will be administered through the Oregon Health Plan (OHP), the state’s Medicaid and Children’s Health Insurance Program (CHIP) embodiments. Medicaid was established in 1965 as an amendment to the Social Security Act. Section 1115 of the Social Security Act allows states to propose “any experimental, pilot, or demonstration project … to promote the objectives” of Medicaid, so long as the project “would result in an impact on eligibility, enrollment, benefits, cost-sharing, or financing” of the state’s Medicaid program.

            On January 7th, 2021, CMS released  guidance for State Health Officials exemplifying the breadth of possible programs under Section 1115. The guidance listed categories of support that may address social determinants of health such as: housing-relating services and supports, non-medical transportation, home-delivered meals, educational and employment services, and community integration initiatives. In accordance with Section 1115, these program’s goals are to “lower health care costs, improve health outcomes, and increase the cost-effectiveness of health care services and interventions for Medicaid and CHIP beneficiaries.

Guidance published by CMS on January 4th, 2023 elaborated on the power of Section 1115. This guidance detailed how to propose services that would stand in lieu of a traditional healthcare facility, like a hospital. The goals of these programs are to “offset potential future acute and institutional care and improve quality, health outcomes, and enrollee experience.”

As of November 2nd, 2022, Oregon was one of twenty-two states that had submitted proposals for or been approved to implement a program under Section 1115to address social determinants of health. One program in North Carolina delivers fresh produce to Medicaid recipients in hopes to fend off diabetes and other nutrition-related diseases. In West Virginia, a program expands access to substance use disorder treatments, housing while in recovery, and peer support services for Medicaid recipients. Arizona used Section 1115 to integrate health plans, manage long-term health plans, and expand dental coverage to Medicaid recipients, as well as those in its Urban Indian health program.

Although approaches to Section 1115 and Medicaid eligibility differed greatly between the Trump and Biden Administrations, states like Oregon continue to propose, implement, and oversee inventive projects to bolster the Medicaid system. Hopefully, Section 1115 will give rise to data-backed programs that Congress and CMS can implement on a national level.

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