Homeless housing program in LA saves the government money

Permanent housing for homeless people in Los Angeles County is actually saving the local government more money than it costs, according to a new study from RAND Corporation. The program was started in an effort to provide support for people with complex medical and behavioral health issues, and has caused a significant drop in the use of public services.

The initiative, which is known as Housing for Health, has led to large drops in the use of emergency medical services and inpatient hospital care. The utilization of outpatient care has also declined.

Overall, for every $1 invested in the housing program, the Los Angeles County government saved $1.20 in health care and social service costs. These are among the most substantial savings ever documented for a housing program that benefits homeless individuals.

Sarah Hunter is a senior behavioral scientist at RAND, a nonprofit research organization, and lead author of the study.

“These findings suggest that a permanent supportive housing program that targets people who are both homeless and are frequent users of county health services is feasible and may save local government money overall,” said Hunter. “It will be important to continue to examine the effort as it scales up to help even more people.”

Los Angeles County has the highest rate of unsheltered homelessness in the country. Individuals who are both chronically ill and homeless, who frequently seek health care and social services, are among the groups targeted by the program for services.

The RAND study investigated the experiences of 890 people who received housing and support during the first 2.5 years of Housing For Health. The research team looked at this group’s use of county services in the year prior to receiving housing and compared it to the use of services in the following year.

The researchers found that public services for the participants during the year prior to enrollment in the program costed $38,146, which dropped to $15,358 in the year after housing was received. After taking into account the costs of permanent housing for the group, the county still saved around 20 percent.

“These savings are substantially higher than what has been seen in other cities and suggest that Los Angeles County officials have succeeded in implementing this model,” said Hunter. “Oftentimes, these programs strive to ‘break even’ in terms of costs and only exhibit cost savings among the most vulnerable, while the Los Angeles program shows considerable savings across a diverse population.”

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By Chrissy Sexton, Earth.com Staff Writer