Service Use and Costs for Persons Experiencing Chronic Homelessness in Philadelphia: A Population-Based Study

Recent research has demonstrated how persons with serious mental illness who are chronically homeless incur substantial service use costs. Services examined include homelessness services (shelter and outreach), general health care, mental health care, and incarceration, but reductions in these services that are associated with supportive housing placements can offset much of the cost of providing this combination of housing and services. Initial studies that reported such findings have led to a more generalized cost-offset model that has served as a prototype for 34 unpublished studies that have estimated cost reductions associated with housing placement and attendant services. More recent research has found significant cost reductions associated with "housing first" programs (immediate housing without requirements for sobriety, treatment session attendance, and other barriers to housing).

Largely because of these successes in providing housing and services to this population with greater cost-efficiency than achieved with temporary shelters, the U.S. Congress and the federal government have established ending chronic homelessness as a federal priority. Along with this emphasis have come expectations that public costs will be reduced when chronic homelessness is ended. Such a view is predicated on the assumption that chronically homeless persons make substantial use of expensive services in the general health, mental health, and criminal justice systems. Insofar as most of the published research on cost offsets has focused on persons who have serious mental illness, chronic homelessness may have become confounded with heavy (and expensive) use of services, particularly mental health services. Were this the case, expectations about cost offsets and the provision of overly expensive support services may be unrealistic.

This study examined service use in a comprehensive population of chronically homeless individuals in a large U.S. city over a three-year period. This study differed from the cost studies previously referenced in that it was not restricted to those who received a supportive housing placement, many of whom were selected because of psychiatric disability or a history of heavy service use. The goal in broadening the study population was to produce a more robust and representative distribution of cumulative service use and costs associated with chronic homelessness and a more reliable baseline against which intervention costs and potential cost offsets could be projected. In addition, the population examined included a subgroup identified as chronically homeless and primarily staying in unsheltered locations. This is the first study of service use and attendant costs in this broader subgroup.

Publication Date: 
2010
Volume: 
61
Issue: 
11
Location: 
United States