To Address Homelessness, New Medical Group Combines Managed Care, ‘Street Medicine’

With the population of unhoused individuals in California soaring to more than 161,000, a new medical group called Healthcare in Action is being created to provide healthcare and other services to individuals experiencing homelessness. In a recent interview, Michael Hochman, M.D., a primary care doctor and the inaugural CEO of Healthcare in Action, described their approach of combining managed care and “street medicine.”

Long Beach, Calif.-based SCAN Group, whose holdings include SCAN Health Plan, one of the nation’s largest nonprofit Medicare Advantage plans, is launching Healthcare in Action.

Hochman is a graduate of Harvard Medical School and the Robert Wood Johnson Foundation Clinical Scholars program at UCLA. He was tapped to lead the new medical group based on his experience as the director of the USC Gehr Family Center for Health Systems Science and Innovation and a senior health deputy to former LA County Supervisor Mark Ridley-Thomas. In both roles, he was responsible for improving systems of care for underserved populations.

The new medical group will serve SCAN Health Plan members as well as members of other health plans.

The group’s focus will be on providing “street medicine” to older adults, who comprise one of the fastest growing segments of the homeless population. In Los Angeles County alone, the number of homeless individuals over age 55 is predicted to grow from 20,550 in 2011 to 36,045 in 2025—a 75 percent increase.

Hochman said that  both from an objective level and an anecdotal level, the homelessness crisis has gotten a lot worse in Southern California over the past few years. “I've been in Los Angeles working in the county system and community healthcare for the last 11 years. Anecdotally, we're just seeing it more and more. You know, until recently, I was an attending physician in LA County + USC Medical Center, the big county hospital. Now it's almost 25 percent of patients in beds are homeless, which is a significant increase over a decade ago when I first started.”

Hochman said the new organization, set to launch in January 2022, is bringing together two different concepts that have been successful in their own right: street medicine and managed care.

“Both SCAN CEO Dr. Sachin Jain and I worked with Boston Healthcare for the Homeless,” Hochman said. “I previously was at USC, they have a street medicine program. What's great about this is you get rid of the four walls of a traditional medical office, you care for patients where they are on the streets, under bridges, in recuperative care facilities.

The problem with street medicine programs, however, is that they typically require charitable funding. “They're great programs. There's just not a path for sustainability, so we're putting this together with managed care,” Hochman said. “Especially here in California, there are some really interesting groups that have taken on high-need, high-cost populations with the managed care framework with shared savings and taking on risk and have created sustainable models.” Healthcare in Action hopes to blend the managed care concept with the street medicine model to create something that's sustainable and provide better care for patients.

Under the auspices of the new medical group, doctors, physician assistants, nurse practitioners, as well as teams of social workers, community health workers, substance use counselors and others will connect patients with community resources and other programs to address mental illness, substance use, and other root causes of homelessness.

I asked Hochman about the insurance models they are looking at. “What we're proposing to health plans is primary care capitation, or maybe specialty care capitation, but with shared savings on the risk, so maybe they would pay us a per-member per-month for primary care,” Hochman said. “If we can reduce the health plans loss from $10,000 per member per year to $5,000, then we would split that $5,000 in savings, and we see a path to sustainability there.”

Their first priority is going to be the frail, older homeless population, the Medicare-eligible and dually eligible in many cases. “But we've also realized that if we if we can’t ignore the Medicaid patient population with the homeless population because that's such a big slice of the pie,” he said. “So what we've decided is that as long as 51 percent are Medicare-eligible, we will take up to 49 percent straight Medicaid.”

He noted that the state, county and city have invested billions of dollars in housing. “One thing that I've noticed is that there's been a real focus on the ‘housing first’ concept. I was really optimistic about that when that model came out seven or eight years ago, and I saw it work successfully, but a number of medical conditions interfered with that model,” Hochman said. “If someone's mental health or substance use wasn't under control, even if the housing was offered to them, it didn't go well. So my thinking has matured and evolved. I do believe in giving people housing. But I think that t needs to be hand in hand with the health care, so that when the mental health and substance use are under control, that's when you push the housing option.”

Healthcare in Action is going to start with three street medicine teams in Southern California. Their exact location will depend on the health plans that they contract with. “We're not planning any bricks and mortar,” Hochman said.  “There will be mobile units where patients can get on if need be. But one thing that the street medicine community will tell you is that patients don't want to get on the van to get their blood drawn. They'd much prefer if you come and draw the blood, drain the abscess, where they are in their tent or their setting. So I actually think more than half the time it's going to be true street medicine.

The No. 1 challenge of street medicine is consistently finding people. In the USC street program that Hochman has been involved with, on a typical day, they will schedule with 10 patients, and it's a good day if they find five or six of them. “We have to be prepared for that,” Hochman said. “So how do we increase the success rate? Well, one key is to connect with patients when they're in the hospital. So that's an opportunity to catch them, identify them, develop a relationship over a few days and then come up with a discharge plan together.”

Another strategy involves giving cell phones to patients that will help with communication. They are exploring inexpensive devices so that if they get lost, the financial loss will be minimized.

Hochman said the new organization is ready to meet new challenges and course-correct as they go. “I think the big innovation is bringing in the managed care framework, but we're trying to replicate the best practices in street medicine.  Our academic partner on this is going to be the USC Keck School of Medicine. They're advising us and helping us create the best model.”