How to Become a Transitional Rent Provider Under CalAIM in California: A Comprehensive Guide
California's healthcare landscape is transforming with Transitional Rent as the 15th Community Support under CalAIM. As documented by the Department of Health Care Services (DHCS), this initiative provides up to six months of rental assistance for Medi-Cal members experiencing or at risk of homelessness, with optional launch in January or July 2025 and mandatory implementation by January 2026¹. DHCS has formally submitted this program to the Centers for Medicare & Medicaid Services as an amendment to the CalAIM Section 1115 demonstration².
Understanding Transitional Rent
Transitional Rent addresses chronic or serious nutrition-sensitive conditions to improve health outcomes and reduce unnecessary costs. Eligible members must have clinical risk factors (chronic health conditions or significant behavioral health needs), be experiencing or at risk of homelessness, and be part of specified transitioning populations such as those exiting institutional care, jail, or foster care.
Research has shown that individuals experiencing homelessness face significantly elevated mortality risks. A comprehensive study of unsheltered homeless adults in Boston found age-standardized mortality rates nearly 3-fold higher than those in the general Massachusetts population, with a mean age at death of just 53 years⁴. Moreover, the hazard ratio of all-cause mortality for the homeless compared with non-homeless cohorts has been documented at 4.4, demonstrating the profound health impacts of homelessness³.
In California specifically, the UCSF Benioff Homelessness and Housing Initiative conducted the largest representative study of homelessness in the United States since the mid-1990s. The study found that 90% of participants lost their last housing in California, debunking myths about homeless migration. The median length of homelessness was 22 months, and nearly half of all homeless adults were aged 50 or older, highlighting the aging crisis within this population⁵.
Step 1: Assess Your Organization's Readiness
Your organization should possess experience serving individuals experiencing homelessness, capacity to manage housing placements and rental payments, ability to coordinate with healthcare providers and social services, and robust systems for data tracking and reporting. Ideal candidates include providers of homelessness services, affordable and supportive housing providers, CoC-affiliated entities, PHAs, county behavioral health systems, and county housing programs.
Step 2: Master Service Requirements
Core service components encompass three main areas:
Housing Placement Services
Identifying appropriate options
Negotiating with landlords
Facilitating lease agreements
Payment Administration
Managing rental payments to landlords
Tracking utilization (up to 6 months per member)
Ensuring housing meets quality standards
Care Coordination
Developing individualized housing support plans
Connecting members to Enhanced Care Management (ECM)
Facilitating transitions to permanent housing
Covered housing settings range from apartments, SRO units, and single-family homes to ADUs, tiny homes, shared housing, permanent supportive housing, recovery housing (at member's choice), and interim settings like hotels and motels.
Step 3: Prepare for MCP Contracting
Since no state-level enrollment pathway exists, MCPs vet organizations based on their ability to receive referrals and provide authorized Community Supports, sufficient experience providing similar services within the service area, capacity to submit claims using standardized protocols, proper business licensing that meets industry standards, and clean compliance history regarding fraud, waste, or abuse. Organizations must demonstrate proper licensing, insurance, technical capabilities for electronic billing, and the capacity to ensure housing meets habitability requirements.
Step 4: Develop Essential Systems
Your data management infrastructure must track member enrollment and utilization, submit encounter data using appropriate HCPCS codes (H0044 for permanent settings, H0043 for interim settings), interface with HMIS, and share data with MCPs and care coordination partners.
Quality assurance processes should include housing inspection protocols, member satisfaction tracking, outcome measurement systems, and compliance monitoring procedures.
Step 5: Build Strategic Partnerships
Success requires collaboration with multiple entities. Managed Care Plans serve as your primary contracting relationship, referral source, and payment mechanism. County Behavioral Health Systems are critical for serving members with behavioral health needs, with DHCS considering allowing them to directly authorize Transitional Rent temporarily. Continuums of Care provide coordinated entry system integration, HMIS data sharing, and permanent housing pipeline access. Enhanced Care Management providers offer care coordination partnerships, referrals, and transition planning support.
Step 6: Navigate Contracting Successfully
Consider the implementation timeline carefully, with optional launch dates in January or July 2025 and mandatory implementation by January 2026. Contract negotiations should address payment terms including rate structures based on Fair Market Rent, payment timing, and administrative cost coverage. Performance expectations encompass member engagement targets, housing placement timeframes, and quality metrics. Reporting requirements include data submission schedules, outcome reporting, and compliance documentation.
Step 7: Implement Housing First Principles
Transitional Rent must follow Housing First requirements, meaning MCPs and counties cannot condition authorization or continued receipt on sobriety, service engagement, or "housing readiness." Remove barriers to housing access, provide member choice in housing selection, separate housing provision from service participation, and focus on housing stability as the primary goal.
Step 8: Prepare for Ongoing Operations
Staffing needs include housing navigators/specialists, case managers for housing support planning, administrative staff for billing and reporting, and quality assurance personnel. Training should cover CalAIM program requirements, Housing First principles, data privacy and HIPAA compliance, and cultural competency with trauma-informed care approaches.
Financial planning must account for cash flow management since payments may lag service delivery, reserve funds for security deposits, administrative cost coverage, and scaling capacity as referrals increase.
Common Challenges and Solutions
Housing availability challenges can be addressed by building strong landlord relationships, maintaining housing inventory databases, and considering master leasing arrangements. Complex eligibility requirements require clear screening tools, thorough staff training, and strong communication with MCP authorization teams. Care coordination complexity demands investment in care management platforms, clear protocols with ECM providers, and participation in local care coordination collaboratives. Data system integration challenges are best resolved through HMIS integration and health information exchange participation.
Resources and Support
Technical assistance is available through the DHCS TA Marketplace, PATH Initiative funding, MCP-specific provider orientations, and community care hub partnerships. Funding opportunities include PATH Initiative grants for infrastructure development, county-specific housing program funding, foundation support for pilot programs, and federal housing program coordination.
Next Steps
Becoming a Transitional Rent provider represents a significant opportunity to address the intersection of homelessness and healthcare in California. Success requires careful preparation, strong partnerships, and commitment to Housing First principles.
To proceed:
Assess your organization's readiness using the criteria outlined above
Connect with local MCPs to understand specific requirements
Engage with technical assistance resources through DHCS and PATH
Begin building necessary partnerships with ECM providers, CoCs, and county systems
Develop your implementation timeline aligned with MCP launch dates
Remember that Transitional Rent provides a time-limited opportunity to help members exit homelessness, establish a bridge to permanent housing, and realize the improvements in physical and behavioral health that result from long-term housing stability. Your organization can play a vital role in making this vision reality for California's Medi-Cal members experiencing homelessness.
For the latest updates and detailed requirements, visit the DHCS CalAIM website and consult with your local Managed Care Plans.
References
Department of Health Care Services. (2023). DHCS Initiates 30-Day Public Comment Period for BH-CONNECT and CalAIM Transitional Rent Services. California State Association of Counties Bulletin.
Department of Health Care Services. (2023). DHCS Submits Request for Federal Approval of Section 1115 Demonstration. California State Association of Counties Bulletin.
Morrison, D. S. (2009). Homelessness as an independent risk factor for mortality: Results from a retrospective cohort study. International Journal of Epidemiology, 38(3), 877-883. https://doi.org/10.1093/ije/dyp160
Roncarati, J. S., Baggett, T. P., O'Connell, J. J., Hwang, S. W., Cook, E. F., Krieger, N., & Sorensen, G. (2018). Mortality among unsheltered homeless adults in Boston, Massachusetts, 2000-2009. JAMA Internal Medicine, 178(9), 1242-1248. https://doi.org/10.1001/jamainternmed.2018.2924
UCSF Benioff Homelessness and Housing Initiative. (2023). California Statewide Study of People Experiencing Homelessness. University of California, San Francisco. https://homelessness.ucsf.edu/our-impact/studies/california-statewide-study-people-experiencing-homelessness
