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May, 2001 FannieMae
Foundation
 The Impact of Supportive
Housing for Homeless People with Severe Mental Illness on the
Utilization of the Public Health, Corrections, and Emergency
Shelter Systems: The New York-New York Initiative
Data on 4,679 homeless people with severe mental disorders
placed in supportive housing in New York City between 1989 and
1997 were merged with administrative data on the utilization of
public shelters, public hospitals, Medicaid-funded services,
veterans inpatient services, state psychiatric inpatient
services, state prisons, and the city's jails. A series of
matched controls who were concurrently homeless but were not
placed in housing were similarly tracked through administrative
records.
Adjusting for demographic and other pre-intervention
differences between the cases and controls,
regression results reveal that homeless people placed in
supportive housing experience marked reductions in shelter use,
hospitalizations (regardless of type), length of stay per
hospitalization, and time incarcerated. Prior to placement in
housing, homeless people with severe mental illness used an
average of $40,449 per person per year in such services (in 1999
dollars). Placement in housing through the New York/New York
program (NY/NY) was associated with a reduction in service use of
$16,282 per housing unit per year, adjusting for concurrent
changes in the controls service use patterns. Unit costs per
year for the supportive housing are estimated at $17,277, which
would result in a modest cost of $995 per unit per year over the
first two years of placement. Overall, the NY/NY initiative, which
included some licensed community mental health residences as well,
resulted in a net cost of $1,908 per unit per year, or $6.9
million. The potential benefits and challenges of further public
investment in supportive housing for homeless people with severe
mental disabilities are discussed.
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