Cost effectiveness of housing first

Housing First

Does it really save money? Concrete experiences from

Finland

Virpi Sillanpää

Tampere University of Technology

Finland

1

- The 15th National Homelessness Conference, 6th November 2014 - 13.2.2015

Motivation for the research

Finnish government’s program to reduce homelessness (2008 –

2011)

Shift towards Housing First principles in Finnish social policy

Benefits of Housing First (in the literature)

• Reduce of the costs in health, social and legal services

• Positive impacts on the quality of life

What is the situation in Finnish context?

The aim of the research:

To create a model to evaluate cost-effects of Housing First

To evaluate cost and benefits of HF

2


Framework for evaluating costs and benefits of HF unit

3


Service Use: amount and

costs

• Health care

• Police

• Special services for

homeless (shelters etc.)

• Institutions

General negative impacts of

homelessness

• Problems in the city center

• Criminality

• Social problems

(individuals, family

members)

• Inhuman conditions, etc.

Homelessness

Costs related to living in the

unit

- Rents in the HF unit

- Costs of support in HF unit

Service Use: amount and

costs

- Health care services

- Police etc.

Qualitative impacts

• related to individuals/

residents: improved qualify of

life, etc.

• other stakeholders

• family members

• environment

Living in the Housing

First Unit

Cost related to living

(independently)

Independent living

Service Use

Qualitative impacts/benefits

• related to individuals/

residents: improved

qualify of life, etc.

• other stakeholders

• family members

• environment

Financial benefits

• For individuals: increased

income

• For the society: increased

tax revenue

Research data

Two case studies: Case Härmälä, Case Pitäjänmäki

Residents’ use of 1) health, 2) social and 3) legal services was

traced for a certain period before moving to the HF unit and for a

period during occupancy of the unit

Data on service utilization of individuals was obtained from client

data bases administrated by different authorities

The qualitative impacts of living in the HF unit were assessed by

interviewing residents

Themes of the interviews:

• Benefits and downsides of the unit

• Changes in life after the move to the unit (in health, relationships to

friends and family, personal financial situation)

• Aspirations for the future

4


Case A: Housing First unit Härmälä

Operated by a third sector organization, the City of Tampere

purchases services

All residents have own flats and tenancy agreements

The unit was opened in June 2009, it has 22 apartments (22

residents), 5 employees

15 of the residents participated the research that was carried out

in 2010, six residents were interviewed

All residents have a history of long-term homelessness, alcohol

abuse, mental problems

Residents have moved to the HF unit either from the street,

institutions or shelters

Unit offers help and support in everyday life, assistance in

rehabilitation and guide residents to preventive services

5


Case A:

Service use and costs during homelessness

6


Service use and costs during

homelessness (5 months before

moving to HF unit) 155 884 €

Amount of

services

used

Number of

people

using

services

Institutional care, shelters, welfare

services for alcohol abusers 121 357€ 1540 days 13

Health care 30 016 €

GP visits 2 119 € 21 8

Visits to nurse 278 € 8 3

Hospital care (days) 20 849 € 45 days 6

Emergency room visits 3 473 € 5 5

Visits to specialized health care 2 236 € 7 5

Ambulance 1 061 € 12 6

Arrests by police 4 512 € 24 4

Case A: Service use in the HF unit and

comparison to the time of homelessness

7


Service use and costs in HF unit: 95 987€

Amount of services used

Change, qty

Change, -59 897 €

Number of people using services

Institutional care, shelters, welfare services for alcohol abusers 3 374€ 16 days - 1524 days - 117 983 3

Health care 5 690 € - 24 325

GP visits 2 220 € 22 + 1 + 101 8

Visits to nurse 452 € 12 + 4 + 174 7

Hospital care (days) 0 0 - 45 days - 20 849 0

Emergency room visits 1 962 € 6 + 1 - 1 511 3 Visits to specialized health care 526 € 2 - 5 - 1 710 2

Ambulance 530 € 6 - 6 - 530 5

Number of arrests by police 376 € 2 - 22 - 4 136 2 Cost of support in the HF unit 52 797 € + 52 797 15

Rents in the HF unit 33 750 € + 33 750 15

Case A: Changes in costs

Cost savings were 59,897 € 38%, over a five-month period, which

indicates 143,753 € cost reduction per year for 15 people (rents in

the unit are included)

roughly 9,600 € savings per person per year

If rents are not included to comparison, cost savings were 93 647

€ 60 %, over a five-month period, 224 753 € per year

roughly 15, 000 € savings per person per year

Costs related to other services (i.e. health care, police)

During homelessness 34 528 €, in the HF unit 6 066 €

Cost savings for 15 people was 28 462 €, which indicates 68 308 € cost

reduction per year, about 4 600 € per person a year

8


Case A: Qualitative results

Residents were more satisfied to their lives after moving to the

unit compared with the situation before the move

Benefits and downsides of the unit

• Benefits: privacy, location near services, comfortable new homes,

support from personnel

• Downsides: expensive rent, resembles institution

Effects to residents’ lives

• Health effects: decrease in alcohol consumption, better access to

regular health services and rehabilitation, peace of mind

• No major changes in relationships with friends and family members

• Most of interviewees were fairly content with their personal financial

situation

Aspirations for the future

• Decrease in alcohol consumption, independent living, building

connection with family members again (children), new hobbies,

finding a job

9


Case B: Housing First unit Pitäjänmäki

Operated by Salvation Army, the City of Helsinki purchases

services

All residents have own flats and tenancy agreements

The unit was opened in February 2011, it has 111 residents, 24

employees, personnel is on duty 24/7

Unit offers help and support in everyday life, assistance in

rehabilitation and guide residents to preventive services,

organized work daily 9 am to 3 pm

Residents have a history of long-term homelessness, substance

abuse (alcohol and/or drugs), mental problems

Residents have moved to the HF unit either from the street,

institutions or shelters

23 residents participated the research

10


Case B: Service use and costs during

homelessness

11


Service use and costs (one year) 307 359 €

Amount of

service use

Number of

people

Accommodation and services:

Institutional care, shelters

Detoxification centers (longer-term)

135 335 €

82 813 €

52 522 €

4 993 days

311 days

20

6

Health care 162 488 €

GP visits (in health centre) 5 353 € 54 18

Emergency room visits 9 439 € 28 10

Visits to nurse 2 760 € 69 15

Home calls by visiting nurse 2 150 € 43 2

Visits to mental health clinic 4 422 € 17 5

Visits to detoxification centers (short-

term) 5 842 € 24 8

Hospital care (days) 96 862 € 373 days 8

Visits to specialized health care 6 482 € 26 10

Visits to clinic for abusers of

intoxicants 29 138 € 303 4

Arrests by police 9 576 € 94 12

Case B: Service use in the HF unit and

comparison to the time of homelessness

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Service use and costs in HF unit 658 138 €

Service

use

Change,

qty

Change, €

+ 350 799 €

Housing and support:

- Housing (rents)

- Cost of support

Detoxification centers

524 388 €

169 968

340 204

14 216

8 395

56 days

+ 3 402

+ 8 395

-255

+ 389 053 €

+ 87 155 €

+ 340 204 €

- 38 306 €

Health care 131 407 € - 31 041 €

GP visits (in health centre) 2 800 30 -24 - 2 553 €

Emergency room visits 17 451 27 -1 + 8 012 €

Visits to nurse 2 537 59 - 10 - 223 €

Home calls by visiting nurse 388 8 - 35 - 1 762

Visits to mental health clinic 1 577 8 - 9 - 2 845 €

Visits to detoxification centers

(short-term) 1 416 € 6 - 18 - 4 426 €

Hospital care (days) 37 580 € 77 - 296 - 59 282 €

Visits to specialized health care 6 469 € 19 - 7 - 13 €

Visits to clinic for abusers of

intoxicants 61 189 € 657 + 354 + 32 051 €

Number of arrests by police 2 343 € 23 - 71 - 7 233 €

Case B: Changes in costs

Total costs increased by 350 800 €, 15 300 € per person

The major increase relate to support provided by the HF unit, 340 000 €,

14 800 €/person

Participants were former long-term homeless people, who had lived on

streets/with friends or in shelters - > low costs during the homelessness

Costs related to use of health services declined by 20 %

Amount of hospital days declined by 80 % and costs by 60%

Use and cost of withdrawal increased substantially (more than

doubled)

Short term visits to detoxification centers and number of arrests by

police declined both by 75 %

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Benefits and downsides of the unit

• Benefits: own apartment, privacy, freedom to move around,

professional personnel and their support, location, organized

work/workshops

• Downsides: permitted use of alcohol, not enough common activities

Effects to residents’ lives

• The most of interviewees (6) reported increased well-being and

decrease in alcohol consumption

• Daily workshops was a focal change in everyday life for 5 persons, 4

had become more active with hobbies

• Relationships with family: no major changes, slightly more intense

than before, new neighbours

• Personal financial situation had improved

Aspirations for the future:

• Rehabilitation, decrease in substance abuse, finding a job or

continue with studies

14


Case B: Qualitative results

Comparison of cost effects

Total costs

In Case A cost savings were 38%, in case B costs doubled

Effects to use and costs of other services

Health care services

Declined in both cases, in case A savings was 80 %, and in case

B 20 %

• cost of hospital days declined in case A by 100%, and in case B by

60%

Other services

Arrests by police declined in both cases, in case A by 90 %, in

case B by 75 %

Use of other “crisis services”

• in case A use of ambulance declined by 50 %, in case B use of short-

term detoxification center declined by 75%

15


Conclusions and limitations of the research

Contradictory results

Cost savings in case A, substantial cost increase in case B

Why?

• Differences in costs of housing support in HF units

• Different types of residents

• Research focuses on changes

Service use and cost during the homelessness was at different

level in cases A and B: in case A average cost/person a year was

24 900 €, in case B it was 13 400 €

In both cases HF unit had positive effects on clients’ quality of life

Limitations

• Limited number of participants: 15 in case A, 23 in case B

• Costing principles in units and services may differ

• Research was conducted shortly after opening the unit

-> longer-term effects?

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Literature

Laihonen, H. & Sillanpää, V. (2014), What is the Role of Knowledge

Management in Establishing the Effectiveness of Public Welfare

Services?, Knowledge and Process Management, Vol. 21, No. 2, pp.112-

121.

Sillanpää, V. (2013), Measuring the impacts of welfare service innovations,

International Journal of Productivity and Performance Management, Vol.

62, No. 5, pp. 474-489.

Asunnottomuuden vähentämisen taloudelliset vaikutukset

Ympäristöministeriön raportteja 7/2011, 114 s. URN:ISBN:978-952-11-

3848-5. ISBN 978-952-11-3848-5 (PDF).

• Report (in Finnish)

Asunto ensin yksiköiden kustannusvaikuttavuus – vertailussa

mielenterveys- ja päihdekuntoutujien yksiköt

• Report available in the web site of Ministry of Environment (in

Finnish) http://www.ym.fi/download/noname/%7B13F1333B-9C45-

438D-B9BD-59D0BEE62339%7D/77950

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http://www.ym.fi/download/noname/%7B13F1333B-9C45-438D-B9BD-59D0BEE62339%7D/77950











Thank you!

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Cost effectiveness of housing first

Presentations & Public Speaking