Shapiro Administration Highlights $1 Million Housing Investment to Improve Health, Lower Health Care Spending for PA Medicaid Recipients | Department of Human Services |[...]

Governor Josh Shapiro's 2026-27 budget includes a total of $1.9 million in state funds to invest in both housing and reentry supports for Medicaid recipients with certain chronic health conditions - investing in preventive health care solutions that improve health and quality of life to lower long-term health care spending.

The new budget investment in housing builds on solutions and initiatives outlined in the Commonwealth's first comprehensive Housing Action Plan, which includes pathways to housing stability and sustainability that improve both individual and community wellbeing.

Allentown, PA - The Shapiro Administration is investing in programs to create healthy, safe communities across the Commonwealth, and today Pennsylvania Department of Human Services (PA DHS) Secretary Dr. Val Arkoosh celebrated $1 million in state funding to implement the Investments in Health housing pilot program in Governor Josh Shapiro's 2026-27 Budget. This program - prioritized within the Housing Action Plan for Pennsylvania - will support Medicaid recipients with chronic health conditions who are currently or at risk of becoming homeless, connecting them with housing-related and community health services with the goal of improving health and avoiding more costly health services.

At The Lehigh Conference of Churches, Secretary Arkoosh learned firsthand about the organization's comprehensive work to support people facing housing instability in the Lehigh Valley. During the visit, she toured a home for individuals leaving county correctional facilities and sat down with people who struggled with homelessness and housing instability. Secretary Arkoosh listened to their stories and discussed the Commonwealth's commitment to creating affordable housing opportunities for all Pennsylvanians.

"When we invest in housing, we're investing in the health of individuals and our community as a whole. People who are housed are more likely to find and keep a job, are better able to manage chronic health conditions like diabetes where medication needs to be properly stored, and are less likely to go right to emergency departments and hospitals for everyday health care needs," said Secretary Arkoosh. "This budget allows us to pursue innovative new solutions that will bolster the Shapiro Administration's work to make sure Pennsylvanians in every zip code have access to the resources they need to be on a path to long term stability and lead healthier lives."

Instable or inadequate housing often impacts a person's ability to access other necessities like food, transportation, child care, behavioral health care, and more. The Governor's new budget makes strategic investments that allow PA DHS to pilot proven strategies to improve the health and well-being of some of Pennsylvania's most vulnerable residents, all while reducing the burden on taxpayers.

The new $1.9 million investment in state funds allows Pennsylvania to leverage additional federal matching dollars, bringing total funding for the Investments in Health pilot program to $5.2 million in the first year, and allows PA DHS to start work in two key areas:

• Housing Stability: $1 million in state funding to leverage additional federal funding for a total of $2.5 million to launch a pilot that will help Pennsylvanians experiencing homelessness connect to stable housing and services.
• Reentry Supports: $900,000 in state funds to leverage additional federal funding for a total of $2.7 million that will support pre-release Medicaid coverage for incarcerated individuals returning to their communities from State Correctional Institutions.

Targeted budget investments in these proven services improve people's health and quality of life, reduce health care costs and hospital visits, improve public safety and reduce recidivism.

The Lehigh Conference of Churches is a nonprofit human services organization dedicated to walking alongside individuals and families experiencing extreme poverty as they overcome barriers such as homelessness, hunger, housing instability, mental health challenges, trauma, reentry, limited support systems, and lack of access to essential resources. Last year alone, The Conference provided services and support to more than 23,000 individuals across the Lehigh Valley, including supports with housing and reentry.

"Housing someone who has experienced homelessness is about far more than handing them the keys to an apartment. Lasting stability requires the right supports every step of the way to address the challenges that led to homelessness in the first place. At the same time, we must confront the reality that safe, affordable housing remains out of reach for many, with average rent for a one-bedroom apartment in Allentown exceeding $1,300 per month," said The Lehigh Conference of Churches Executive Director Abigail Goldfarb. "If we are serious about creating lasting housing stability, we must invest both in the systems that expand access to affordable housing and in the supportive services that help people remain stably housed. We applaud the Governor's commitment to funding these critical supports and creating pathways to long-term success for our neighbors."

Building on Pennsylvania's Progress

This year's budget continues the Shapiro Administration efforts to help address the Commonwealth's housing needs and leverages three years of work protecting renters and homeowners:

• In February 2026, Governor Shapiro unveiled the first-ever comprehensive Commonwealth Housing Action Plan, which offers nearly thirty strategic initiatives to ensure every Pennsylvanian has access to safe, stable, and affordable housing.
• In 2024, Governor Shapiro secured a $10 million annual increase until 2027 for the Pennsylvania Housing Affordability and Enhancement (PHARE) Fund - PHARE has funded over 1,000 projects to build or repair more than 8,200 housing units since 2023.
• In his FY 2024-25 budget, Governor Shapiro launched Pennsylvania's first statewide Right-to-Counsel initiative, investing $2.5 million to provide legal counsel for people facing evictions. He secured the same funding in FY 2025-26.
• In his FY 2024-25 budget, Governor Shapiro secured a $5 million increase for the Homeless Assistance Program (HAP) to strengthen county-level homelessness prevention, emergency shelter, and rapid rehousing efforts across Pennsylvania.
• The Shapiro Administration also invested $2.5 million in Emergency Housing Support for local governments, providing municipalities with flexible resources to respond quickly to urgent housing needs and help stabilize families at risk of displacement.

Read more about Governor Shapiro's 2026-27 Budget.