Chronic Homelessness

Chronic homelessness is long-term or repeated homelessness of a person with a disability. Many chronically homeless people have a serious mental illness like schizophrenia and/or alcohol or drug addiction. Most people who experience chronic homelessness have been in treatment programs, sometimes on dozens of occasions.

There were approximately 124,000 chronically homeless people in January 2007. Evidence from applications since then indicates that the number has declined, at least partly because of an increase in the amount of permanent supportive housing.

Permanent supportive housing combined with policies to prevent people from becoming homeless represent the solution to chronic homelessness. The vast majority of people who experience chronic homelessness interact with multiple service systems, providing an opportunity to prevent their homelessness in the first place. Promising prevention strategies focus on people who are leaving hospitals, psychiatric facilities, substance abuse treatment programs, prisons, and jails.

A landmark study of homeless people with serious mental illness in New York City found that, on average, each homeless person utilized over $40,000 annually in publicly- funded shelters, hospitals (including VA hospitals), emergency rooms, prisons, jails, and outpatient health care. Much of the cost was for psychiatric hospitalization, which accounted for an average of over 57 days and nearly $13,000. When people were placed in permanent supportive housing, the public cost to these systems declined by $16,282 per unit of permanent supportive housing, nearly enough to pay for the permanent supportive housing.

Other studies have shown even more dramatic results from permanent supportive housing. The Denver Housing First Collaborative reduced the public cost of services (health, mental health, substance abuse, shelter, and incarceration) by $15,773 per person per year, more than offsetting the $13,400 annual cost of the supportive housing. Similarly, Portland, Oregon’s Community Engagement Program (CEP) reduced the cost of health care and incarcerations from $42,075 to $17,199. After accounting for the $9,870 per person in program costs, there was a $15,006 per person annual cost savings for the first year following enrollment in CEP.