Hospitals across the country look to expand housing for homeless patients

Hospitals across the country are subsidizing housing or building housing on their own campuses for patients dealing with homelessness.

The United States' homeless population reached 2.7 percent in 2019, according to a Friday press release from the Department of Housing and Urban Development (HUD).

Health care systems and hospitals in Denver; Chicago; Camden, New Jersey; Sacramento, California, and other cities are hoping to expand housing options for those who are ready to be discharged but don't have a safe home to return to. Many are reframing the issue of homelessness as a serious medical condition -- but one that can be treated from an apartment rather than in a hospital bed.

Experts say this kind of initiative may save hospitals since it costs more to keep someone in a hospital bed than it costs to care for them in a regular bedroom.

Under the Emergency Medical Treatment and Active Labor Act (EMTALA) of 1986, hospitals are legally obligated to admit members of the public in need of treatment regardless of their ability to pay. Section 1867 of the Social Security Act requires hospitals with Medicare to provide medical screening examinations upon request regardless of a patient's ability to pay.

Similarly, under the Affordable Care Act (ACA), popularly known as Obamacare, nonprofit hospitals must conduct a "community health needs assessment" (CHNA) every three years to maintain their statuses as tax-exempt organizations.

To conduct those assessments, nonprofit health systems and hospitals are required to partner with public and local health programs to strategize how to identify and address specific needs in communities.

The U.S. provides more charity care than any developed nation in the world, but it comes at a hefty cost. After ACA was passed, U.S. hospitals spent about $40 billion providing uncompensated care. Hospitals do get funding from the government and charities, but these costs ultimately fall on American taxpayers. Hospitals may also compensate for large amounts of debt by cutting services or even jobs.

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Patients can use valuable hospital beds for weeks or even months after their immediate medical needs are addressed.

A one-night stay at a hospital in Denver can cost up to $2,700. In California, the average cost-per-night stay at a nonprofit hospital is about $3,500, which is the same average cost-per-night rate at a for-profit hospital in Delaware, according to Beckers Hospital Review.

So, hospitals are looking for new approaches to meet federal requirements and simultaneously provide quality care to patients in need.

Denver Health housing initiative

Denver Health, a nonprofit safety-net hospital that cares largely for uninsured patients with funding from Medicaid, partnered with the Denver Housing Authority (DHA) in 2019 to take on housing for elderly people with illnesses or disabilities suffering from homelessness.

Denver Health is working on converting a campus building into affordable housing for patients who are ready to leave their hospital beds, Denver Health Chief Financial Officer Peg Burnette told FOX Business.

At any given time, Denver Health has about 25 people in the hospital who no longer need care, and the costs of the rooms they occupy fall on the hospital. The homeless patient population can make up as much as half that number, Burnette said, and the hospital expects it to grow.

"Either they have no home, or there is no availability for them at a nursing home or psychiatric care center," she explained.

One Denver Health patient spent four years at the hospital. Others have no home to go back to for in-home treatment. Health professionals at Denver Health use the word "stranded" to describe these types of situations, according to the Denver Post.

Denver Health has a deteriorating building on campus that was built in the 1950s and used for administrative purposes. The hospital closed down the building to save costs while it researched potential development partners, which is when it decided to partner with DHA, which offered to buy the building and transform it into housing for qualified seniors by 2021, Burnette said.

"In regard to the development of the building ... we started looking at how housing and health care systems can achieve beneficial outcomes ... particularly with homeless individuals who come into Denver Health with health issues," Denver Housing Authority Executive Director Ismael Guerrero told FOX Business.

"It doesn't take too much to understand that ... if they have an affordable rental unit -- if someone is able to be discharged but they don't have a place to go -- the hospital can provide them affordable housing where they can continue their recovery," Guerrero continued.

Fourteen of the units in that building will be dedicated to sheltering homeless senior individuals who are also patients at Denver Health and do not have a safe home to return to after receiving treatment. Denver Health case coordinators will work with the patients in those 14 units to provide the care they need; the end goal is to help these patients find permanent housing or transform unsafe homes into livable spaces.

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As the homeless population grows, which Burnette expects it will, and Denver Health's housing project proves to be functional, the hospital may be able to expand the number of units in the building.

The project will not only save hospital costs, but caretakers will also make sure those patients suffering from homelessness will register for insurance so the chances of patients relapsing decreases, thus saving the hospital costs from a long-term perspective, Guerrero said.

"It makes good business sense from a compassionate approach," he added.

Burnette said the program saves obvious costs, but the hospital's priority is rather to help those in need and meet "the goals of the community" and Denver Health's mission as a hospital that helps people who come from underprivileged backgrounds.

Other hospitals that spoke with FOX Business about providing housing to patients homeless patients expressed concerns that if competing health care systems reach out to community organizations that aim to help shelter local homeless populations, participation may be spread too thin across communities.

But Burnette said Denver Health is not worried about that issue.

"It's helpful to the community as a whole if hospitals and health care systems work to shelter the homeless," she said. "It's fitting for our mission at Denver Health, and we've seen data recently that says all health care providers experience this, so it would probably benefit the community if we all worked together on this."

Guerrero said collaboration is always necessary, and more partnerships would benefit the Denver community as a whole.

"Health care is very complicated," he said. "It requires a lot of specific knowledge about the delivery of service, and affordable housing requires a lot of specific knowledge, too, so this kind of collaboration should scale up and we should have more partnerships."

UI Health's Better Health Through Housing Program

The University of Illinois at Chicago Hospital and Health Sciences System, or UI Health, is another example of a facility that has taken on such an effort to provide shelter for those who have been discharged but do not have a home to return to.

Unlike Denver Health's plan to build housing on hospital ground, UI Health's "Better Health Through Housing" (BHTH) program partnered with the Chicago nonprofit Center for Housing and Health (CHH) to provide private housing for homeless patients starting in 2015.

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UI Health initially committed $250,000, which came from donations and the hospital's general operating budget, to help move 26 patients suffering from homelessness and physical or mental illness into private housing. Since 2015, the hospital's operating budget has funded the program, and the hospital expects to have housed a total of 75 individuals by next year.

To date, the program has spent $539,000 and will spend about $350,000 this fiscal year, BHTH Director Stephen Brown told FOX Business.

"It's a baby step into Population Health," he said.

FHP is a public-private partnership that provides supportive housing for individuals suffering from homelessness who frequent hospital ERs, paramedic services, jails and shelters, UI Health's website explains.

The BHTC program "was started to provide permanent housing and social services to chronically homeless emergency department patients. The [FHP] expands this concept by consolidating capital to build capacity to house more individuals, so it provides a synergistic effect that is much greater than what individual hospitals can do on their own," UI Health CEO Mike Zenn said in a statement.

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Out of the top 100 ER patients at UI Health, about 48 percent had experienced homelessness within the last 12 months, Brown said.

But the purpose of BHTH is not about cutting costs, he added. After implementing BHTC, Brown said there was a 20-60 percent cost reduction, but not necessarily for the hospital. While it may cut costs for insurance companies or others who work with UI Health, the program was put in place to serve society's most vulnerable individuals, Brown said.

UI Health doesn't "derive a direct financial benefit" from the program, he explained. "We're reframing [homelessness] as a serious medical condition. This is an extremely vulnerable population. It's a failure of the system, not the people."

BHTH is in the middle of its second evaluation and will have a better idea of how the program has saved costs for UI Health once the evaluation concludes.

Brown's response to the issue of local hospitals and health systems looking to the same federal and local organizations for help differed slightly from Burnette's response.

Brown agreed that trying to provide housing to a homeless patient is "very complicated, it involves multiple stakeholders, and it requires a collective approach to make a dent in this problem," he said. "We have to do this is a collective and sustained way."

He also said, however, that a fully funded program can offer more beds, but "if every hospital did that, [UI Health] wouldn't have the opportunity to do the same."

The most difficult part of operating a program like BHTH is building trust, Brown explained.

"We had to reframe the idea of discharging someone out of the hospital to moving from the hospital to housing," he said. "It's about building trust and understanding mental health. We had to learn to forcefully advocate for these individuals because they can't advocate for their own health."

Brown mentioned one 38-year-old patient who couldn't remember the names of his brothers, his elementary school or the street he grew up on.

"We had to advocate for him because he can't advocate or plan for himself," Brown said, adding that "some people need a little help and some people need a lot of help. One size does not fit all."

Camden Coalition of Healthcare Providers' Housing First Program

The Camden Coalition of Healthcare Providers Housing First is an example of a local organization that partners with hospitals and health care systems within its communities to serve populations with complex needs, including treatment for illnesses and disabilities.

Based in Camden, New Jersey, the Coalition's Housing First program "identifies frequently hospitalized and housing-unstable individuals in Camden using the Camden Health Information Exchange and provides them with safe, dignified housing with extensive support services so that they can improve their health and manage chronic conditions," according to its website.

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"There is a growing community of health centers and systems that are focused on trying to change how we deliver care to high-cost, high-care patients," Mark Humowiecki. Camden Coalition National Center for Complex Health and Social Needs senior director, told FOX Business.

"Housing is one of the most important issues in complex care. It makes managing chronic illness much more complicated," he said, later adding that it "provides a level of safety, security, emotional stability that enables people who have been homeless and are dealing with chronic medical conditions, mental health issues and substance abuse disorders to focus on making changes."

The Housing First program is focused on "high-utilization patients" who "correlate with high costs but not good health care results," which is why the Coalition is trying to make the management of these patients' needs more productive, Humowiecki explained.

Housing First works with the state government to give vouchers to qualified patients for permanently affordable housing.

One such patient, Robert Jackson, said that after he received his voucher for housing, he stayed because he didn't want to disappoint those at the Coalition who helped him find his footing.

"It was the team, the team aspect, I think that helped a lot. ... Not wanting to disappoint the team," Jackson said, according to a press release. "Everybody’s going to bat for me, I better take care of myself, do what I have to do."

Camden Coalition Social Work Operations Senior Program Manager Laura Buckley said some of the people the Coalition offers vouchers to don't believe it at first.

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"Patients often don’t believe we will connect them to housing," she said. "There is even a level of skepticism when patients sign their lease and get the keys! Not until patients use those keys to officially unlock the door to their new home[s] does it start to sink in as reality."

Housing First receives funding from the New Jersey Department of Community Affairs, the Camden County Homelessness Trust Fund, the Virtua Foundation, Camden County, the South Jersey Behavioral Health Innovation Collaborative, UnitedHealthcare, NeighborWorks America and Horizon Blue Cross Blue Shield of New Jersey.

The Camden Coalition also functions as a support for organizations across the country that are trying to make headway on the same issue. The Coalition leads a national program to guide other organizations and health care systems find housing for frequently hospitalized people suffering from homelessness.

Humowiecki said there is a need for coordination within communities to develop programs like Housing First to help homeless patients find a place to live and recover so they do not readmit themselves to hospitals.

From a savings perspective, Humowiecki said it's obviously less expensive to run 20 houses in a community rather than 200, and "structures are not always in place to cooperate and create something like" the Coalition's Housing First program. Those who find housing also tend to stop re-entering hospitals because they learn to "take care of themselves" at home, thus creating long-term savings for hospitals.

Communities need infrastructure and recourses to create such a program, Humowiecki said. If local hospitals and health systems try to compete with housing programs rather than coordinate, there would be more wasteful spending and energy, he added.

Dignity Health and CommonSpirit’s Community Investment Program

Dignity Health -- the fifth-largest health care system in the country based in California -- has made a similar commitment to helping individuals suffering from homelessness find shelter after receiving care at the facility.

Dignity Health partnered with Catholic Health Initiatives (CHI) in February to create CommonSpirit Health, a $29 billion nonprofit Catholic health system that aims to support "a range of community health programs to create healthier communities and address the root causes of poor health" such as affordable housing, according to Dignity Health's website.

"Most of our support for affordable housing has been through focused investment," Dignity Health External Communications Manager Chad Burns told FOX Business.

CommonSpirit's Community Investment Program "provides capital, in the form of below-market-rate loans, to institutions and organizations that address social determinants of health such as affordable housing, development of health clinics and social services," Burns added.

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He said the Dignity Health community is invested in supporting individuals "with the greatest need in the community" it serves. In 2019, Dignity Health approved 41 loans worth a total of $76.5 million "to support community investments."

Since 1990, the Community Investment Program has approved about $300 million in community investment, "45 percent of which has been for affordable and transitional housing," he concluded.

CommonSpirit Health System Director Ashley Brand, who started her career in Los Angeles trying to help people suffering from homelessness find housing, is helping create more system-wide approaches to find housing for frequently hospitalized people without permanent or stable homes through the Community Investment Program.

She explained that the most important thing to do when identifying the needs of a community is to identify the needs of that community's most vulnerable individuals and try to help them. This approach to helping homeless patients is also important when considering finances so health systems and hospitals can be mindful of what resources need funding.

"Housing may increase needs initially, but they would taper off over time," she explained, adding that a hospital is usually not the right place to help a sick or disabled person suffering from homelessness recover and transition into full-time housing to avoid readmission.

CommonSpirit "creates a system approach but also recognizes approaches in each local community" to address homelessness, Brand said.

Brand mentioned one specific program in which Dignity Health partnered with the community outreach nonprofit organization Lutheran Social Services (LSS) to create "Housing with Dignity," which places patients in one of five transitional housing units.

The units offer access to services such as "medication management, behavioral health support, access to primary care physicians, transportation, life skills training, and access to ... social security benefits, with the goal of transitioning these individuals into permanent supportive housing," according to Dignity Health's website.

Brand said that if more than one hospital or health system in a locality want to partner with community organizations to address homelessness, they need to "share priorities and leverage resources while also being mindful that there are never enough resources."

"The homeless are community members, not part of one hospital or one health care system," she said.

California's homeless crisis is a major contributor to the United States' homeless population growth in 2019. Homeless rates decreased in 29 states and Washington, D.C., while they increased in 21 states including California, where homelessness increased by 16.4 percent or 21,306 people.

HUD Secretary Ben Carson pointed to the state's high housing costs as part of the reason why California has experienced such a drastic increase in homelessness.

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"As we look across our nation, we see great progress, but we're also seeing a continued increase in street homelessness along our West Coast where the cost of housing is extremely high," Carson said in a statement.

"In fact, homelessness in California is at a crisis level and needs to be addressed by local and state leaders with crisis-like urgency. Addressing these challenges will require a broader, community-wide response that engages every level of government to compassionately house our fellow citizens who call the streets their home."

As a result of the state's homeless crisis, cities like LA and San Fransisco have seen correlating health crises, as well, due to the large number of people living outdoors in public spaces.

Organizations and health systems like Dignity Health and others across the country have adopted HUD's "Housing First" method as a way to make sure the sick and disabled have an opportunity to find shelter before being discharged so they do not continue a cycle of returning to the streets and then being readmitted back into a hospital.

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