Cost Savings Associated with Housing First

I’m co-author of a new study on cost savings to the health and justice sectors associated Housing First, focusing on Calgary. The other co-authors are Ali Jadidzadeh and Dan Dutton.

Here are 10 things to know:

1. Housing First refers to the immediate provision of subsidized housing (with social work support) to persons experiencing long-term homelessness. With Housing First, there’s no requirement of ‘housing readiness’ on the part of the tenant (i.e., abstinence from drugs or alcohol, or being medication compliant).
    
2. Previous research found there to be cost savings in the health and justice sectors associated with Housing First. However, that research was experimental, meaning that new program settings were developed for the purpose of research. Our study, by contrast, looks at programs already in place, meaning they had several years to evolve and improve before we studied tenant behaviour. It also means that we studied Housing First in the context of a central homeless-serving organization (i.e., the Calgary Homeless Foundation) that has been providing program oversight for many years.   
     
3. Supporting a person in Housing First in Calgary typically costs between $14,000 and $30,000 annually. The precise amount depends on the intensity of the staff support. I’ve referred to this support above as social work support, but it can actually be more specialized than that.  
      
4. The study looks at the impact of Housing First programs on public service utilization for people experiencing homelessness in Calgary. Specifically, we look at single adults without dependants.  
     
5. The study has two main research questions. First, it asks if the delivery of Housing First reduces the utilization of the health and legal systems. It then asks by how much and over what period. (This particular study doesn’t estimate the benefits of Housing First to individual tenants—e.g., improved health, greater life expectancy, etc.)  
     
6. The study is based on a large sample. There are 2,222 individuals in the study’s dataset, spanning the years 2012-2017. The data on individuals was taken both at move-in and in subsequent follow-up assessments every three months.   
     
7. The questionnaires completed by tenants helped us estimate both health and justice costs. Tenants were asked: how many times they’d been hospitalized in the previous three-month period; how many times they’d used Emergency Medical Services in the previous three months; and how many times they’d had interactions with police in the previous three months.  
     
8. The study estimates the actual cost of hospital use thanks to costing data provided by Alberta’s provincial government. Alberta Health publishes reports on the cost of providing hospital and Emergency Room services for people experiencing homelessness. These per-visit costs are higher among persons experiencing homelessness than for the general population.  
     
9. Justice costs are estimated with our knowledge of the cost of the warrant cycle, which we assume to be the average cost of an interaction with police. The estimated cost of police issuing a ticket in Calgary is $139. Arresting an individual who has not paid their tickets costs an additional $135. And the resultant court appearance ranges in cost between $222 and $253. If an individual is convicted, then one day in jail costs $220. Each warrant cycle in Calgary is therefore estimated to cost a total of $1,376, which we use as the unit cost for a single interaction with police.  
     
10. The study finds that every $1 spent on Housing First in Calgary is associated with more than $2 of savings to the public system. In other words, the roughly $42M budgeted by the Calgary Homeless Foundation for Housing First for fiscal year 2018-19 likely resulted in savings of more than $84M in terms of hospital visits, ER visits, and justice services. In the Calgary context, these savings accrue mostly to the province (which funds the health system and courts) and the municipal government (which funds police services).

In sum. This research, which began while Ali and I worked at the Calgary Homeless Foundation, would not have been possible without the cooperation of the Calgary Homeless Foundation and the Government of Alberta. Future research could build on this study by tracking the costs and types of service utilization through linked data.

I wish to thank the following individuals for assistance with this blog post: Dan Dutton, Susan Falvo, Ali Jadidzadeh, Ron Kneebone and Vincent St-Martin. Any errors are mine.

For a full copy of the article, please email me at falvo.nicholas@gmail.com.

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This blog was reposted with permission from the author. Find the original post here.

The analysis and interpretations contained in this blog post are those of the individual contributors and do not necessarily represent the views of the Canadian Observatory on Homelessness.