3. Would improved funding for affordable housing decrease the burden on hospitals?
In 2018 the Canadian Medical Association Journal published a brief commentary piece that was entitled, āShould health care dollars be used to house the homeless?ā (Glauser, 2018). Since we ourselves like asking questions, we were intrigued. The article contains quotes and information from Dr. Mitchell Katz detailing a strategy in New York City that redirects public health funding into housing, resulting in lower health care spending because of lower demand. Dr. Stephen Hwang was cited in this article as saying that ending homelessness should be a goal, but that it is not something that we should do because it saves money. We wondered, would improved funding for affordable housing decrease the burden on hospitals? We posed this question to several researchers in the fields of medicine and housing, including Dr. Hwang, to see what they would have to say. Before we share their thoughts and what the research shows, we invite you to read the original article that sparked this discussion and record your own thoughts in the space below. What do you think ā should we use health care dollars to house people and reduce the burden on hospitals?
First read the article, then record your thoughts below: Should health care dollars be used to house the homeless? (cmaj.ca)
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Having safe, secure, and affordable housing is a key social determinant of health. For people to be well, they need to have a place where they can go to meet their basic needs, such as resting, eating, and bathing. Having housing is critical for good health. With this in mind, it makes sense that if we were to increase the amount of funding that went into developing affordable housing, more people would be housed and in better physical and mental health. We begin with a brief video of Dr. Cheryl Forchuk explaining the clear connection between housing and health.
Dr. Cheryl Forchuk: Would improved funding for affordable housing decrease the burden on hospitals?
In this video, filmed at a hospital during the COVID-19 pandemic, Dr. Cheryl Forchuk agrees that improved funding for housing and poverty would help offset health care costs because people who experience homelessness are vulnerable to a myriad of health issues. This video is 0:33 in length and has closed captions available in English.
Key Takeaways ā Dr. Cheryl Forchuk: Would improved funding for affordable housing decrease the burden on hospitals?
- Improved funding related to housing and poverty would help because if a person is experiencing homelessness, they are vulnerable to a myriad of health issues.
Given there is a clear connection between oneās housing status and their health, why then do we not take health care dollars and reinvest them into developing housing? There is a simple and appealing kind of logic behind this way of thinking. Further, the commentary piece we began this section with showed that it can be an effective practice. Indeed, increased funding in housing could decrease hospital burdens but as with all questions in this book, the answer is never that simple. Dr. Abe Oudshoorn discusses the relationship between housing and health care in the next video and explains that the siloed way in which governments are structured creates financial restraints.
Dr. Abe Oudshoorn: Would improved funding for affordable housing decrease the burden on hospitals?
In this video, Dr. Abe Oudshoorn argues that there is a well-documented relationship between housing and health such as through simple connections, like housing quality, and through complex connections, like interconnected social determinants of health. He notes that to improve the relationship, investments would be needed in primary care access for this population and increasing the deeply affordable housing stock. However, Dr. Oudshoorn notes that while the economic return on investment is clear, the argument does not get much traction within governments because they are not set up to incentivize one Ministry to create savings for another. This video is 3:26 in length and has closed captions available in English.
Key Takeaways ā Dr. Abe Oudshoorn: Would improved funding for affordable housing decrease the burden on hospitals?
- There is a well-documented relationship between housing and health.
- When considering the social determinants of health, income and housing are two fundamental and related issues.
- There are simple connections between health and housing, such as the dangers of living in places with mold and pests that increase the risk of disease.
- There are also complex connections between health and housing, such as that without stable housing it is more difficult to access education and employment, and build strong social networks.
- To improve the relationship between health and housing, two investments are needed.
- The first investment is to improve primary care services, as many people who experience homelessness are disconnected from quality primary care.
- The second investment needed is in creating deeply affordable housing.
- Research has shown that investments in permanent housing result in a return on investment in areas such as the criminal justice system, health care system, and child welfare system.
- There is a simple economic argument, about saving money through investments, but the system is not designed to incentivize one Ministry to save money for another Ministry.
- Economic arguments do not get much traction within government because a Ministry that spends more (such as on housing) does not get credit for reducing spending in another Ministry (such as health care). Rather they get criticized for spending more, and the other Ministry spends the savings on something else.
In 2010 the United Kingdom introduced Social Impact Bonds as a new way to finance social service and health promotion programs, where investors would provide capital and then be reimbursed if the program met pre-set criteria for what was considered a successful outcome (Katz, Brisbois, Zerger, & Hwang, 2018). Katz et al., (2018) note that there are many areas of concern with this approach, including increased costs to governments, restricted program scope, fragmented policymaking, undermining of public-sector service provision, mischaracterization of the root causes of social problems, and entrenchment of systemically produced vulnerabilities. They further argue that it is essential to consider the long-term, aggregate, and contextualized effects of these social impact bonds (Katz et al., 2018). Different countries have approached the funding of health and social programs in various ways with very mixed results.
What do you think?
How should Canada fund health care and affordable housing development? The way governments are currently structured in Canada means that housing falls under one Ministry and health care falls under another. Dr. Oudshoorn noted that problems arise as Ministries are not incentivized to create cost savings for one another. Should governments implement incentives so that Ministries are rewarded in some way for creating savings in another?
Wiens et al., (2021b) conducted a study on the costs of health care services for adults with a history of homelessness, comparing those with and without mental illness. They found that 16% of the general cohort and 30% of those with mental illness were in the top 5% of health care users in Ontario, based on administrative data. The costs for these frequent health care users were largely attributed to emergency department and inpatient services, and people included in this group were characterized primarily as being female gender, having a regular medical doctor, using acute services in the preceding year, having poor perceived general health, and two or more diagnosed chronic conditions (Wiens et al., 2021b). We have seen throughout this chapter that indeed some people who experience homelessness are frequent users of health care services, with high costs attached.
In additional analysis, Wiens et al., (2021a) examined the relationship between this frequent health service usage and housing status in Ontario based on administrative health records. The findings indicated that as people get housed, their health care usage (and associated costs) initially increase but then decrease, suggesting that housing may reduce health care costs over time (Wiens et al., 2021a). However, another study conducted by Hinds et al. (2018) showed the opposite, that use of health care services initially declined after people went into public housing but then increased after a period of time. These studies show that for some people, being housed increases health care use initially and then reduces over time (Wiens et al., 2021a) and for others being housed decreases health care use initially and then increases over time (Hinds et al., 2018). Clearly, we need to learn more about the factors that lead to increased or decreased usage of health care services, to inform future decision-making. We invite you now to read the article, āDoes housing improve health care utilization and costs?ā authored by Wiens et al., (2021a) as this sectionās featured reading.
Featured Reading:
Wiens, K., Nisenbaum, R., Sucha, E., Aubry, T., Farrell, S., Palepu, A., Duhoux, A., Gadermann, A., & Hwang, S. W. (2021a). Does housing improve health care utilization and costs? A longitudinal analysis of health administrative data link to a cohort of individuals with a history of homelessness. Medical Care, 59, S110-S116.
It may be that for some people, getting housed creates connections with supports that include access to health care providers. For others, getting housed may reduce their need for health care, as their health status starts to improve. There is much that we still need to learn about the connection between housing and access to health care services. In the chapter on Politics, Policy, & Housing in Canada we introduced Housing First, as a programmatic intervention that has become increasingly popular in Canada. Housing First is an approach that prioritizes getting people housed and then provides wrap-around services based on peopleās self-identified needs. Housing First was initially evaluated as an intervention for people who had experienced chronic homelessness and also had a mental illness, through the multi-site āAt Home / Chez Soiā study (Goering et al., 2014). One of the primary arguments in favour of Housing First has been that it helps improve peopleās well-being and quality-of-life, while also being cost-effective.
In a review of the effectiveness of Housing First for individuals with mental illness, Kerman et al., (2020) used data over a 24-month period from a multi-site randomized controlled trial and found that Housing First was effective in securely housing frequent emergency department users despite their complex health needs. They also found that there were reductions in emergency department use and substance use problems, as well as improvements in mental health symptoms and community functions over the course of the study (Kerman et al., 2020). In the next video, Dr. Kelli Stajduhar discusses housing as a human right that improves peopleās well-being, pointing to Housing First as one model that prioritizes peopleās health in a non-judgemental way.
Dr. Kelli Stajduhar: Would improved funding for affordable housing decrease the burden on hospitals?
In this video, Dr. Kelli Stajduhar argues that housing is a fundamental right and that having affordable housing is necessary for a person to be in good health. She notes that many people who experience homelessness do not want to go to hospital, and will avoid going until necessary because it causes them to relive past traumas and discriminations they have had in institutional settings. Dr. Stajduhar concludes that there are good housing models in the world, such as Housing First, that prioritize health in a non-judgemental way. Living a stable life requires security of housing, which is a lesson we can learn from tent cities. In the absence of affordable housing, people will find ways to create a sense of community but peopleās capacity to survive is not a substitute for providing them with affordable housing options. This video is 3:13 in length and has closed captions available in English.
Key Takeaways ā Dr. Kelli Stajduhar: Would improved funding for affordable housing decrease the burden on hospitals?
- Housing is a fundamental right.
- Having good / affordable housing is necessary for a personās health and results in better health outcomes. Without affordable housing, it is very difficult to be in good health.
- Being in good health decreases the chances of going to the hospital.
- Many people who experience homelessness do not want to go to the hospital, as it causes them to relive past traumas and discriminations they have had in institutional settings.
- Often people experiencing homelessness will avoid going to the hospital until it is absolutely necessary and they have no alternative sources of health care.
- There are some good housing models in the world, such as Housing First, that prioritize health in a way that is non-judgemental.
- Nobody can have stability without the security of a place to live, and all that goes along with it like safety and a place to keep oneās belongings.
- The lesson we should take from tent cities is that in the absence of affordable housing, people will find ways to create a sense of community but peopleās capacity to survive is not a substitute for providing them with affordable housing options.
Housing First has been widely adopted because of its core principles, which focus on client-centred practices like choice and harm reduction. However, there has also been interest in the financial implications of Housing First initiatives (Jadidzadeh, Falvo, & Dutton, 2020; Latimer et al., 2017). The question is asked ā can we save money by housing people and providing them with supports? Data from the At Home / Chez Soi study indicated that the cost to provide housing and supports was as low as $14,496 annually per person (Latimer et al., 2019). The cost savings that can be achieved by housing people rather than funding emergency supports are certainly appealing from a government or funder perspective, but they do not tell the whole story about investments in Housing First. Dr. Tim Aubry was a lead researcher in the At Home / Chez Soi study. Here he discusses the balancing effect that we also must consider in relation to Housing First, and questions why we even need an economic argument to justify ending homelessness in Canada.
Dr. Tim Aubry: Would improved funding for affordable housing decrease the burden on hospitals?
In this video, Dr. Tim Aubry explains that while there are some costs savings associated with programs like Housing First ā particularly around reductions in service agency use, hospitalization and emergency medical service use, and correctional system involvement ā the cost savings have likely been over-estimated. He argues that a small percentage of individuals use services at high rates but that many more use them at moderate rates or not at all. When services are provided to people through Housing First programs, there is a balancing effect where those who use services at high rates and those who previously did not use services meet in the middle. However, the bigger issue Dr. Aubry notes is that we as Canadians implement many expensive health interventions, such as for cancer and heart disease, without questioning the costs, yet we subject efforts to end homelessness to these kinds of financial analyses. He notes that the question should not be whether we will save money by housing people but rather, why do we have to come up with an economic business case to solve homelessness? This video is 4:37 in length and has closed captions available in English.
Key Takeaways ā Dr. Tim Aubry: Would improved funding for affordable housing decrease the burden on hospitals?
- There are savings that do occur with implementing programs like Housing First, particularly in relation to reductions in social service use for people experiencing homelessness, hospitalizations and use of emergency rooms, and justice and correctional system involvement.
- We have likely over-estimated the savings that accompany housing programs because there are only a small percentage of people who are āsuper-usersā of services who have incredibly high use. There are many more individuals who use moderate levels or no services at all.
- When you connect people with supports and services, that group that was not accessing any at all is going to cost more.
- The frequent users of services and non-users of services offset costs for one another in programs like Housing First. They essentially meet in the middle.
- Even with Housing First, cost-benefit analysis shows the cost-offsets do not completely pay for the program.
- The health sector regularly implements expensive treatments without having to justify cost-offsets, yet housing programs, like Housing First, are subjected to economic scrutiny.
- As Canadians, if we support expensive treatments for cancer or heart disease, why would we not also put money into helping people get out of homelessness, even if there are costs associated?
- The question should not be whether we will save money by housing people but rather, why do we have to come up with an economic business case to solve homelessness?
Housing First is one intervention that has the potential for improving peopleās health and decreasing health care usage, but we cannot assume it is a magic bullet solution. In the next video Political Studies professor Dr. Jonathan Greene reminds us that housing can lead to both increases and decreases in health care usage and that, while Housing First is important, we need to dig deeper to understand the nature of these complex relationships.
Dr. Jonathan Greene: Would improved funding for affordable housing decrease the burden on hospitals?
In this video, Dr. Jonathan Greene argues that connecting people with stable housing might reduce the costs of emergency medical service use, but that at the same time it could increase the use of on-going primary care. He cautions that we often get focused on finances but what we should be concerned with is finding out what individualized supports people need to remain securely housed. Dr. Greene notes that even in the At Home / Chez Soi study where Housing First was implemented with all the supports, some participants returned to homelessness. Rather than asking ourselves whether supports will save us money, he urges us to focus on investing in finding out which ones will work best. This video is 4:14 in length and has closed captions available in English.
Key Takeaways ā Dr. Jonathan Greene: Would improved funding for affordable housing decrease the burden on hospitals?
- If people are housed, they might use fewer emergency medical services but their use of ongoing primary care might also increase. That could be a higher cost in the long run, compared to the reduction of emergency service use.
- We get focused a lot on the finances when what we should be concerned with is finding out what individualized supports people need to remain stably housed.
- Even in the At Home / Chez Soi study, where Housing First was implemented with all the supports, some people still returned to homelessness. We need to learn more about how to help these individuals remain housed.
- Implementing the right supports requires making an investment, rather than asking ourselves how to save money on those supports.
Throughout this one chapter alone, we have cited 15 articles co-authored by Dr. Stephen Hwang, and this is just a fraction of what he has contributed to our knowledge about health and homelessness. As one of, if not the, leading researcher on the intersections between health care and homeless in the world, we were interested to know what Dr. Hwang would have to say about the question of increasing funding for housing to reduce the burden on hospitals. He raised many interesting points, echoing his statement in the commentary article we began this section with, that while ending homelessness is always the goal, we should do it because it is the right thing to do and not because it saves us money. Listen in as we speak with Dr. Hwang.
Dr. Stephen Hwang: Would improved funding for affordable housing decrease the burden on hospitals?
In this video, Dr. Stephen Hwang argues that the question of whether spending on housing would decrease health care costs is a contentious issue that needs to be unpacked. He notes that when people ask this question, they are doing so with the recognition that people who experience homelessness may be high users of health care. However, while this is true in some instances, Dr. Hwang encourages us to pause and consider the underlying assumption that says we should do things to save money. He argues that rather than worrying about saving money, we should provide housing because it is the right thing to do. As a parallel example, our society does not ask whether it would save money if we educated fewer people. We educate because it is the right thing to do, and we should also provide housing because it is the right thing to do. Dr. Hwang further makes a distinction between cost-savings and cost-offsets. Some programs, such as Housing First, have cost-offsets associated with decreased use of shelter and psychiatric beds but they are not cost-savings because we still spend money on housing. Dr. Hwang concludes with the observation that very little the health care system does is about saving money. Patients are treated for conditions such as diabetes and high blood pressure without concern over whether money will be saved by doing so. He challenges us to consider why we would expect the housing and homelessness sectors to save the health care system money, when it does not even do so itself. This video is 5:58 in length and has closed captions available in English.
Key Takeaways ā Dr. Stephen Hwang: Would improved funding for affordable housing decrease the burden on hospitals?
- The question of whether spending on housing would decrease health care costs is contentious and needs to be unpacked to understand the underlying assumptions.
- When people ask this question, they realize that people who experience homelessness sometimes use the health care system at high levels, and in some cases because of health issues that arise through homelessness.
- Given the increased use of health care, people may ask whether more funding for housing would reduce health care service usage. The unspoken assumption is that it would save money.
- We should pause and reflect before accepting the assumption we should do things because they will save money, rather than because they are the right or ethical thing to do for people.
- As a parallel example, our society does not ask whether it would save money if we educated fewer people. We educate because it is the right thing to do, and we should provide housing because it is the right thing to do.
- Whether we will save money is not an unreasonable question to ask, but it should not be the reason that we decide to provide housing for people.
- When making a financial argument, it is important to recognize that a cost-offset is different than a cost-savings.
- Research has shown that for certain groups who are unhoused, interventions like Housing First can decrease utilization of other services that provide a cost-offset, particularly for shelter and psychiatric hospital beds.
- Cost-savings by definition mean that we would spend less ā that the reductions exceed the costs invested ā which is almost never the case when providing housing for people. There are cost-offsets but they do not exceed what is spent.
- In health care, almost nothing the system does is about cost-savings.
- Large amounts of money are invested in health care, without having a savings effect, with the exceptions of prenatal care, vaccinating children, and HIV prevention. We treat conditions like diabetes and high blood pressure without concern for saving costs.
- It is unreasonable to expect that homelessness interventions will save money in a health care system that spends large sums of money, when almost none of what the health care system does is about savings.
At the start of this section, we presented a commentary piece published in the Canadian Medical Association Journal with the title, āShould health care dollars be used to house the homeless?ā (Glauser, 2018). This article sparked our interest and led us to wonder whether increased investments in affordable housing could help reduce hospital usage. Should health care dollars be re-allocated to housing in order to offset the costs of frequent health care usage? We began this section with the unequivocal assertion that housing is a social determinant of health and that being securely housed is important for physical and mental well-being. However, we also asserted (as we so frequently do) that the answer requires further unpacking.
We saw that the way our government is organized means that there are no incentives for one Ministry to create cost-savings for another. This means that although spending more on housing may decrease peopleās use of hospitals, there is no benefit for the housing sector to create this offset. The research shows that people who experience homelessness, particularly if diagnosed with a mental illness, are among the highest users of hospital health care. However, the research was also divided on whether housing created higher or lower health care usage initially and over time.
Housing First is a critically important intervention that operates on the premise that housing should be prioritized, and that people should be given wrap-around supports based on their identified needs. This approach has been widely adopted, in part because of its demonstrated cost-effectiveness. We learned from Dr. Aubry, one of the lead researchers on the At Home / Chez Soi study, that to understand Housing First we must consider the cost balances, rather than cost offsets. Housing First is helpful for many people experiencing homelessness but more than focusing on its costs, we need to focus on fine-tuning its effectiveness. We concluded this section by speaking with Dr. Hwang, who echoed the sentiments of all the researchers and argued that ending homelessness should be done because it is the right thing to do, not because it saves us money.
Podcast: Would improved funding for housing decrease the burden on hospitals? (23:09)
Click the link below to listen to all of the researchers answer the question āWould improved funding for housing decrease the burden on hospitals?ā in audio format on our podcast!
