Maine study shows permanent housing for people who are homeless cuts services costs in half

This study that was undertaken by the Maine State Housing Authority, with the help of the Corporation for Supportive Housing and Shalom House, is one more illustration that ending homelessness is less expensive than managing homelessness. The same cost savings will occur in New Jersey.

PORTLAND – Providing permanent supportive housing for people who are homeless improves their quality of life, reduces the burden on social, medical, and police services, and saves money, according to a new cost analysis of nearly 100 formerly homeless residents of Portland.

“Whether you are looking at it from a moral, social, or cost viewpoint, providing permanent supportive housing to people who are homeless is a winning strategy,” said Dale McCormick, Director of the Maine State Housing Authority (MaineHousing), which funded the report.

The study found:

Housing people who are homeless cuts the average costs of services they consume in half.

Formerly homeless people received 35 percent more mental health services, but at 41 percent less cost, illustrating a shift from expensive emergency and psychiatric inpatient care to less expensive outpatient mental health services.

Permanent supportive housing cut by more than half emergency room costs (62 percent reduction); health care costs (59 percent reduction); ambulance transportation costs (66 percent reduction); police contact costs (66 percent reduction); incarceration (62 percent reduction); and shelter visits (98 percent reduction).

The average annual cost of care savings produced by the first year of living in permanent housing was $944 per person. The total annual savings was $93,436 for all 99 tenants.

The study examined costs associated with people who had been homeless but who have been living in supportive housing for at least a year, comparing costs during the year they had permanent housing with the annual cost without permanent housing.