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New $110M Initiative to Deliver Health Care and Housing Support for Arizona’s Homeless SMI Community

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New $110M AHCCCS program will provide health care & housing support for Az's homeless SMI population

Arizona’s Medicaid agency, the Arizona Health Care Cost Containment System (AHCCCS), has launched a groundbreaking initiative aimed at providing crucial support for homeless individuals grappling with serious mental illnesses. Announced on Tuesday, the Housing and Health Opportunities program, or H2O, will be funded with $110 million over a five-year period.

H2O is uniquely designed to assist individuals facing both mental health challenges and housing instability. Eligibility includes those who have been identified with a chronic health condition, are experiencing homelessness, or have interacted with the criminal justice system within the last 90 days. This program is the first of its kind in Arizona, marking a significant shift in addressing the needs of vulnerable populations.

“Housing is health care, and stable housing is essential for improving health outcomes,” said AHCCCS Director Carmen Heredia. Her statement underscores the program’s focus on meeting the basic needs of some of Arizona’s most at-risk residents.

Funding for the initiative comes from the federal Centers for Medicare and Medicaid, earmarked for expanding services over the next five years. An agency spokesperson confirmed that eligible AHCCCS participants will be contacted directly regarding enrollment, with an estimated 3,000 individuals currently qualifying. The program expects to assist up to 8,000 people during its duration.

The H2O program offers transitional housing assistance for a duration of six months, alongside support for housing deposits and utility service payments. Further, once participants find stable housing, the program will facilitate necessary home modifications to ensure safety and accessibility. Connections to additional benefit programs will also be made.

Officials anticipate that this initiative will not only enhance primary care and preventive health services but also reduce dependence on expensive emergency healthcare services and crisis centers. The H2O program builds on existing permanent supportive housing efforts by AHCCCS, which currently supports over 3,000 members and has reportedly reduced behavioral health facility admissions by 89 percent.

Data from the Substance Abuse and Mental Health Services Administration indicates that a significant portion of the homeless population—nearly 25%—has reported experiencing serious mental illness, with 16% also facing substance use disorders. This new initiative aims to address these pressing issues head-on by providing vital resources and support for those in need.