Medicaid insurer pledges to help build $900M in new affordable housing units
The Centene Foundation—the philanthropic arm of the nation’s largest Medicaid insurer—announced it is partnering with developer McCormack Baron Salzar to offer pre-development loans that will enable $900 million worth of planning and construction for new affordable housing units.
The announcement was made by Sarah London, CEO of Centene, during a speaking engagement at Fortune Magazine’s Brainstorm Health Conference. The partnership will create thousands of housing units in eight states, which London said is important to the health of Centene’s members, thus aligning patient care and business incentives.
“One of the barriers to the development of affordable housing units is actually the bottleneck of pre-development dollars,” London said, adding that the partnership with McCormack will allow the organizations to unlock funds for “development projects across the country,” particularly in areas where Centene tends to serve Medicare patients.
London also said that most of what drives patient outcomes is non-medical, and the inability to address concerns related to housing, food, transportation and other social determinants ultimately burdens the healthcare system and increases the cost of care.
“We, of course, make sure that there is access to healthcare, but we also think about what are those things that are other drivers to health outcomes,” she said.
In a statement, Centene said the move is an attempt to address the major nationwide shortage of affordable housing, which the National Low Income Housing Coalition cites at around 7,300,000. As many Medicare patients are homeless, the development of new units could also reduce the number of new and existing people living on the streets.
“Having a safe, stable and affordable place to call home gives a person the foundation they need for a healthy life,” Alice Chen, MD, chief health officer at Centene, said in the statement. “It can help limit exposure to unsafe conditions and stress, as well as increase their likelihood of receiving primary and preventive care.”
A timeline for the development of units—along with specifics on how many will be built by McCormack Baron —was not laid out, but the statement from Centene said the project will last several years.
Other major insurers have launched similar initiatives. Earlier this month, UnitedHealth Group announced it had surpassed $1 billion invested in affordable housing.
Chad is an award-winning writer and editor with over 15 years of experience working in media. He has a decade-long professional background in healthcare, working as a writer and in public relations.