Montana committee hears case to add medical respite to Medicaid, witnesses cite pilot savings

Representative Ed Staffman of House District 59 opened the hearing on House Bill 274, saying the bill would allow people who are homeless to be discharged from hospitals into medical respite beds rather than remaining in inpatient care or returning to the street. “If you or I go to the hospital… the problem is that if you’re a homeless person, you have no home to recover in,” Staffman said, framing the bill as both humane and cost-saving.

The bill would add medical respite services to Montana’s Medicaid program subject to a federal waiver from the Centers for Medicare & Medicaid Services. Staffman summarized pilot data from Bozeman and Missoula, saying the two pilots together produced roughly $945,000 to $1 million in estimated savings and that Montana taxpayers would save about $287,000 of that amount under the proposed program.

Multiple proponents described local results. Kami Kirchberg, manager of Community Health Improvement at Bozeman Health, said the Bozeman pilot prevented “123 avoidable inpatient nights” last season, freed hospital capacity and produced an estimated $209,209 in savings. Jill Bonny, executive director of the Paverila Center Emergency Shelter in Missoula, said the center provided 1,013 nights of medical-respite care in 2023 and estimated a net savings of $226,505 for that year; she told the committee the program’s funding currently comes from a mix of grants, donors and shelter funds rather than state support.

HRDC District 9 administrator Heather Grenier described two winters of a Bozeman pilot that used three winter beds and served 23 people, reporting transitions to stable housing for several participants and average stays that ranged from 14 to 47 nights depending on the pilot year. “House Bill 274 is simple and straightforward. It provides cost savings for taxpayers and improves the outcomes of service and health care partnerships,” Grenier said.

Gene Hermanson, Medicaid chief financial manager at the Department of Public Health and Human Services, told the committee that DPHHS fiscal notes follow standard practice: they cost out the projected cost of any new service rather than calculating dynamic offsets from behavioral changes or program effects. “It is standard fiscal note practice that… we do not try to calculate within our fiscal note what some alternative, offsetting decline in costs would be,” Hermanson said, explaining why the department’s fiscal note does not incorporate the pilot-program savings proponents described.

Committee members asked about funding, service components and implementation. Representative Nickel questioned where Missoula’s program funding originates; Bonny replied it is “various grants,” donor gifts and shelter monies and that the program “comes close to paying for itself” but still needs supplemental support. Representative Close asked whether a federal waiver would be required; Staffman said the waiver would be necessary and cited other states, including Utah, that have implemented similar programs.

Staffman closed the hearing by reiterating the program’s potential benefits: reduced inpatient use, better recovery conditions for people without stable housing, and possible expansion to other communities if a funding structure is available. The committee did not take final action on HB 274 during this meeting; the hearing was closed and the committee moved to other business.

Ending: The committee closed the HB 274 hearing with sponsor and proponent testimony on evidence from pilots and fiscal implications; questions remain about state implementation and the need to pursue a CMS waiver before Medicaid coverage could begin.