Hearing: The Road Home Testimony Before the CA Assembly Select Committee on Homelessness Peggy Bailey Senior Policy Advisor Corporation for Supportive Housing May 10, 2012 csh.org

Supportive Housing: Saving Taxpayer Dollars

Supportive Housing Reduces Costs to Public Systems – Business Case When living in supportive housing, on average, public cost reductions total $4,589 per month, or 70%, per person. Potential fiscal savings for the county providing supportive housing to the 10 th decile exceeds $23,000,000, per month for all 5,000 people.

Medicaid Cost Study Findings Downtown Emergency Shelter Center in Seattle showed 41 percent in Medicaid savings by reducing ER visits and hospital inpatient stays. CSH’s Frequent Users of Health Systems Initiative found that: Prior to housing, residents of supportive housing had ER and hospital inpatient costs over $58,000 Two years after housing, residents incurred only $19,000 Chicago - PSH saved almost $25,000 Portland, Maine - Medicaid costs were reduced by almost $6,000 Direct Access to Housing in San Francisco found that supportive housing reduced nursing home costs by $24,000. * All $$ amounts are per person, per year

Illinois AIDS Foundation of Chicago Cross referencing chronic homeless clients with Medicaid So far they have 49 people housed who cost Medicaid $4.6 million in FY Now we can track the savings for each person. Growing evidence on the need to target clients

Massachusetts Home and Healthy for Good pilot (12 providers participate) Funded with State dollars since 2007 They have housed 555 chronically homeless individuals (467 Medicaid clients) Tenant retention is 82% Medicaid costs reduced from $26,124 to $6,056 per year (this is for the first 119 people housed) Average total savings $9,423 per person, per year (includes the cost of housing)

Frequent Users of Health Services Initiative (FUHSI) - California Local hospitals and service providers collaborated in the development and implementation of more responsive systems of care to address unmet needs, produce better outcomes, and reduce unnecessary use of emergency services. 6 year demonstration project in 6 sites in California – Programs and Interventions diverse, almost all included linkages to housing Alameda County – Project RESPECT Los Angeles County – Project Improving Access to Care Sacramento County – The Care Connection Santa Clara County – New Directions Santa Cruz County – Project Connect Tulare County – The Bridge

Outcomes: Hospital Utilization & Charges FUHSI Interventions Reduce Expensive Hospital Charges One Year Pre- Enrollment One Year in Program Two Years in Program % Change Over Two Years Average Emergency Department Visits ↓61%* Average Emergency Department Charges $11,388$8,191$4,697 ↓ 59%* Average Inpatient Admits ↓ 64%* Average Inpatient Days ↓ 62%* Average Inpatient Charges $46,826$40,270$14,684 ↓ 69%*

California Data Show Similar Costs 28,340 Medi-Cal (CA Medicaid program) beneficiaries who have been diagnosed with at least 2 diagnostic categories visited the ED at least five times in one year or eight times within two years In 2007, these individuals cost the Medi-Cal program $20 million in ED visits, over $360 million in inpatient stays, and over $16 million in ambulance transports. Total averages $14,000 costs to Medicaid in one year per beneficiary. A smaller subset (1,000+) of these incurred over $100,000 in costs to Medi-Cal each during the course of the year.

A Small Number of Very High Risk Homeless Persons At risk for extensive need of health and justice system services The most expensive 10% of homeless persons have average monthly costs $6,529. Well over half of costs incurred were from health care costs. Average Monthly Costs in All Months by Decile for Homeless GR Recipients Source: 2,907 homeless GR recipients in LA County with DHS ER or inpatient records Deciles based on costs in all months whether homeless or housed The greatest cost savings can be achieved by prioritizing high-risk individuals Source: Economic Roundtable, 2011

State Innovation

New York State – Health Homes Approved CMS State Plan Amendment – February 2012 (includes enhanced FMAP for 2 years) SPA – targets Behavioral and Mental Health Conditions Other phases and populations will also be targeted Integrates primary care and many partners, including housing Just getting started

Louisiana – Home and Community Based Services Grew from Katrina and need to address housing for special needs populations, including homeless people Comprehensive reform to maximize Medicaid investment in supportive housing Used many Medicaid mechanisms – including HCBS 1915i state plan amendment, 1915b and 1915c waivers, and 1115 waiver Necessary to target various populations and create comprehensive benefits Will result in 3,000 units (2,300 housed to date)

Massachusetts – Managed Care Creation of the Community Support Program for People Experiencing Chronic Homelessness benefit (C-SPECH) Funded by MA’s 1115 and the Community Support Program (CSP) benefit and included in ASO contract Behavioral health ASO – MBHP administers and created C-SPECH as evidence showed targeted services help achieve results PSH providers bill MBHP for services included in C- SPECH Estimates $3 million in Medicaid savings for 372 people *Note: ASO = Administrative Services Organization MBHP = Massachusetts Behavioral Health Partnership

Opportunities for California AB 2266 Draws on data showing cost savings, while takes advantage of Health Home option in ACA Would provide 90% federal funding for services in supportive housing Would target people who frequently use hospitals No state investment—uses the IL model of designating providers, who have to identify source of non-federal match Benefits package for Medicaid expansion in 2014