Expanding "Faith-Based" Social Services Via Medicaid Program Seen as Difficult

High start up costs and daunting technical requirements will make it difficult to expand faith-based social services through the use of Medicaid resources, according to a new study by the Roundtable on Religion and Social Welfare Policy. The ten-state survey found that faith-based organizations—especially at the congregational level—typically do not have the organizational resources or management skills to meet these demands. 

The Bush administration has proposed increasing financial support for smaller faith-based providers. But the Roundtable report found that the substantial requirements attached to most Medicaid-eligible services generally restrict involvement to all but the most sophisticated organizations, regardless of whether they are secular or faith-affiliated. 

"There's good reason why Medicaid might be a potential funding source for faith-based service providers--its funding is large and growing." said Richard P. Nathan, Director of the Rockefeller Institute of Government, which is overseeing the Roundtable project. "As the nation's largest social service program, Medicaid accounted for $260 billion in federal, state and local spending in 2003." 

But the Roundtable study found that faith-based organizations face significant financial and managerial barriers to expanded partnership with government under Medicaid. 

"To be eligible for Medicaid reimbursements, service providers must meet requirements ranging from the employment of licensed professionals, to installing expensive medical equipment and facilities," said researcher James W. Fossett, the report's coauthor who directs health and Medicaid studies for the Institute. "These are start-up costs not covered by Medicaid that most small organizations typically can't afford." 

However, the Roundtable's study noted there may be viable opportunities for faith-based organizations to provide Medicaid clients with support services which carry lower costs and are easier to administer. 

"These programs might include assisting Medicaid clients with transportation and personal services associated with the activities of daily living," said Senior Policy Analyst Courtney Burke, the report's other coauthor. "Medicaid already funds similar activities in some states." 

Despite the substantial requirements often associated with Medicaid, the Roundtable study found that faith-based providers are widely involved in its programs. For instance, religiously-affiliated hospitals accounted for between 5 and 30 percent of the beds in the states surveyed. 

But virtually all were found to be part of large, well-established organizations, such as Catholic Charities, and organizations affiliated with the Lutheran and Baptist churches. 

The study also found there was little difference between faith-based and secular service providers, mostly due to the fact that both must meet the same technical standards to be certified as Medicaid participants. This finding appeared to carry through all of the service areas studied in the report: hospitals, nursing care, outreach programs, mental health, and substance abuse programs--although faith-based providers appeared to be less active in the last two categories. 

One area in which congregations and small church groups were found to be active was in outreach efforts to promote Medicaid-related programs. But, with few exceptions, the study found most of these involved collaborative volunteer efforts, rather than services provided through funded contracts. While noting this as a potential opportunity for the expanded involvement of small faith-based organizations, the report also found that funding to support such efforts had been reduced or eliminated in many states. 

In identifying specific opportunities, the Roundtable report highlighted the activities of the "Faith in Action" program sponsored by the Robert Wood Johnson Foundation. During the past twenty years, that program has given small grants to coalitions of congregations to provide a variety of non-medical services, such as transportation, grocery shopping, meal preparation, respite and companionship. In all, some 1,900 grants have been given to a wide range of congregations of many different faiths. The program encourages inter-faith collaborations and prohibits proselytizing. 

The study found that in many states, Medicaid supports activities that are roughly comparable to those funded by the foundation. 

For example, non-emergency medical treatment transportation is supported by Medicaid in 44 states, and personal care services such as cooking, shopping and assisted living services, are supported in 28 states and the District of Columbia. 

Congregations and smaller faith-based providers offering such services would likely have to meet more stringent requirements under Medicaid than those demanded by a private foundation. But because such services are simpler and less complex to manage, they may be within the capacity of smaller, less prosperous congregations. The report concluded that these avenues may offer the best opportunities under Medicaid to expand government partnerships with smaller faith-based organizations. 

States included in the Roundtable's Medicaid study were: Arizona, Colorado, Kansas, Michigan, New Jersey, Ohio, Oregon, Texas, West Virginia, and Wisconsin. 

The Roundtable on Religion and Social Welfare Policy was created in 2002 to provide independent, non-partisan research and information on the role of faith-based social service in America. The Roundtable is a project of the Rockefeller Institute of Government, the public policy research arm of the State University of New York. It is supported by The Pew Charitable Trusts. 

Additional information and research may be found on the Roundtable's web site at: www.ReligionandSocialPolicy.org.