difficulty paying rent, overcrowded living conditions, eviction, or homelessness, housing insecurity exposes individuals and families to increased stress and mental and physical health problems. High housing costs or a lack of affordable housing can force households to make difficult sacrifices to pay rent, such as forgoing medicines, medical appointments, and healthier food options. Finding stable, safe, and affordable housing can help on the journey to recovery and prevent hospitalizations, homelessness, and involvement in the criminal justice system.
On Tuesday, May 9 the Health Care Council of Chicago (HC3), in partnership with the Illinois Medical District (IMD) and Prestige Health, hosted a discussion showcasing Chicago-based solutions to address mental and physical well-being through housing stability. At this event, we heard from stakeholders and experts on why providing housing assistance and stability for those with the greatest need can lead to better health outcomes, what solutions are happening in Chicago, and how more investment in these efforts can support healthier Chicago communities.
Allyson Hansen, CEO and Executive Director, IMD (Illinois Medical District)
Moderator: Esther Macchione, Co-Founder & Principle, Prestige Health
Panelists: Stephen Brown, MSW, LCSW, Director of Preventative Medicine, University of Illinois Hospital & Health Sciences System Karolina Duszczak, Chief Plan Officer, Medicaid Services, CountyCare Felix Matlock, Jr., Regional Vice President of Resident Services, Mercy Housing Lakefront Mark Mulroe, President and CEO, A Safe Haven Foundation
Photo credit: Angad Ravaram / Instagram @ravanam.jpg
Watch the Live Event
Event Recap (Paraphrased and highlighted from the event’s discussion)
Allyson Hansen, Executive Director and CEO, Illinois Medical District (IMD) The Illinois Medical District (IMD) is comprised of individuals to help make this 560-acre community where you can live, work, play, and learn. The district's geography includes four hospitals and two universities. We are beginning to look at housing as part of the community we’re cultivating. So, this is an important conversation, and the IMD is grateful to be hosting and bringing these thought leaders together.
Introductions and Background
Esther Macchione, Co-Founder & Principle, Prestige Health (EM)
I co-founded Prestige Health approximately a year ago with the intention of forming a unique collaboration to provide advisory services and support integration and innovation for hospital systems, health plans, and community-based organizations.
Stephen Brown, MSW, LCSW, Director of Preventative Medicine, University of Illinois Hospital & Health Sciences System (SB)
I am the director of the Better Health Through Housing Program. In 2015, the University of Illinois’ Health and Hospital System (UI Health) was approached by the Center for Housing and Help, a super agency that helps place people access permanent supportive housing and is now the administrator of the Flexible Housing Board. UI Health had already made a conscious decision to focus on health equity around the time that we were approached for this opportunity. Government assistance (e.g., Medicare, Medicaid) provides support for 60-70 percent of UI Health’s primary patient population. So, in 2015, we created the Better Health Through Housing Program as a pilot. The decision to run the first-year pilot was not developed for business reasons, and nothing was sustainable about it. I think that one of the prominent challenges that still exists today is that no sustainable business model supports these efforts. How do we make it so we can eliminate the “wrong pockets problem?” Some organizations receive a financial benefit and are not necessarily paying for the good work that we all want to do in social determinants of health (SDoH). This program has become one of the country's longest-running health care housing programs, and we've housed more individuals than any other program and system. The reason that no one else has surpassed that yet, is probably because it is incredibly difficult to motivate busy providers and emergency departments to address SDoH and very hard to maintain the housing stock required to meet the need. One of the challenges in the city of Chicago is that there is a shortage of shelter beds. And most importantly, the question of who is paying for it still lacks clarity and responsibility.
Felix Matlock, Jr., Regional Vice President of Resident Services, Mercy Housing Lakefront (FM) I am the regional vice president for Resident Services at Mercy Housing Lakefront, which provides affordable housing to create stable, viable, disabled, vibrant, and healthy communities. We are focused on creating third-party partnerships with agencies, behavioral health providers, and those providing development, service, and educational attainment. Through our case management system, we aim to engage people in determining what they need and make sure they have those connections.
Karolina Duszczak, Chief Plan Officer, Medicaid Services, CountyCare (KD)
I am the Chief Plan Officer at CountyCare, Cook County's largest Medicaid health plan, which is the government-run Medicaid plan managed in coordination with Cook County Health and Hospital System. CountyCare took some contracted funding from the State of Illinois in 2020 to pilot a community reinvestment program. The program focused on metrics, such as mammograms and diabetes screenings, and provided supportive housing to some members, primarily those who were struggling with mental health illness. Four years later, the program has seen some exciting results, with the data we have captured serving as a critical component to sharing the story and understanding our impact.
Mark Mulroe, President and CEO, A Safe Haven Foundation (MM)
I serve as the President and CEO of Safe Haven Foundation. I have been part of Safe Haven for 25 of the 28 years that we have existed. A Safe Haven started with the idea of offering recovering homes and providing services for substance use disorders. Over the years, we realized that individuals needed support to maintain their housing once they achieved sobriety or stabilization of their mental health. In 2000, we coined the phrase "housing is health care" to connect the two. In the early 2000s, the Coordinated Care Initiative (CCI) started building a housing stock for chronically homeless individuals. We provided supportive housing and support services to help them maintain and sustain their jobs for a long time. These services include behavioral health, substance use, workforce education, and training.
Q: Housing is not a service traditionally covered by Medicaid. However, there are several initiatives, including the flexible housing pool. CountyCare used “withhold dollars” from the pandemic, are some of the ways in which CountyCare is addressing SDoH, including housing?
KD: CountyCare contracted with the state of Illinois to allow people to decide where they invest/spend their supplemental benefits or bonus benefits. There is a variety of engagement with the members and programs to reinvest dollars that can be put into various programs, including housing. CountyCare uses the health plan’s claims data to target specific populations with high emergency accommodation, higher lengths of stay in the hospitals, and additional costs for the programs. There has been a significant decrease in the overall cost of care in the last two years, as well as emergency room visits have decreased.
EM: Mercy Housing’s Model is a “vertically integrated model.” And Mercy’s mission and goal is to support “independence” and permanent housing solutions. What type of impact has the organization and your work had on individuals and communities that have been disproportionally impacted or marginalized?
FM: We support approximately 5,000 homes and 7,000 residents in those homes across three states. Relationships with external partners are critical for us because we provide the housing service, and our external partners can offer and connect these residents with supplemental health and social services. Stabilization through housing can take up to a year or two, depending on the placement and housing type. But permanent supportive housing for those with significant histories of homelessness or substance use issues, mental health, and so on sometimes take a little longer because of the volatility of their overall health status. However, those who move into our senior housing or our family housing are eager to settle in. Often, they have moved out of communities that had significant disinvestments and lack of resources and are ready to stabilize, move up and move out with the supportive services we can provide. And although we can provide them support in finding a job and other stability, it is challenging to shift them into their next phase for housing because of their continued lack of resources for a down payment and so forth. The banking industry has changed somewhat, but more is needed to incentivize and help people level up. What ends up happening is we place people into our housing communities, and they stay for a while, and then there’s not enough turnover and room for new people that come along to access the pool of houses we have to offer. What we have begun to do is to look at the possibility of changing our tenant selection plans to move into other modes like master leasing so that we free up of our some of our unsubsidized units to make those available to organizations and can provide our housing at a reasonable rate.
EM: Mark, what sort of outcomes have you realized with supportive housing being that integrated hub of medical service and non-medical together? What are some of the outcomes that you've been seeing from couples, even individuals from behavioral health or physical well-being?
MM: I can echo what Felix shared and say that Safe Haven Foundation experiences some of the same challenges as Mercy Housing. Yesterday, one of my program managers gave a tour and shared this story about someone who came into our shelter program about five years ago. Getting them to accept additional services outside the overnight stay program took about a year and a half. Once we got this person to accept some of the services and address some of the other barriers they had in place, they've now been housed for three years consistently. This person is now going to college, getting a job, and thinking about getting their own place as they finish their schooling.
As an industry, we want to put time periods on these episodes, and it is a struggle to do so. We could be working with a funder or partner and say “120 days.” Upon further consideration, this person has been chronically homeless for 5 to 10 years. So, it's not going to seamlessly happen in 120 days. It's almost impossible. The first barrier or disparity in this scenario is the chronic condition that everything's going to collapse. So, we need to build a system where services help individuals can get to a safe place. And we've seen it work. We have a track record of over 20 years of people who have achieved it with support from wraparound services with housing. The difficulty is that the housing stock is not quite available. And what Steve brought up about the “wrong pockets” is a hard issue for the industry to solve. Many of our organizations are fighting for funding to pull some of these opportunities together to support the needs of these individuals. And it is a difficult match. And it gets pushed back to community organizations with the suggestion to fundraise for the additional support dollars to supplement the services. We’re already struggling to provide a difficult service, and now we’re supposed to go and make up for the deficit, you are not funding that, but you require outcomes in 120 days? In the end, it is difficult and challenging to balance these competing priorities.
Right now, we’re in a situation with lots of band-aids when we need to consider more comprehensive, systematized, and fair approaches to addressing these issues holistically. We need to approach this in a way that is making a significant investment without strings and consider it an investment in people. Nobody chooses to have a substance use disorder. Nobody chooses to have mental health issues. Nobody chooses to be homeless actively. There are people who do because of those other issues. We provide them with supportive services to help them stabilize and move on with their lives.
EM: Stephen, you and others have referenced the “wrong pockets problem.” Tell us more about that. And what do you think are some of the misalignments of cash flow and how things are being funded from your provider's perspective?
SB: We're taking a very short-term view of a really complicated issue, the wrong pockets problem. Affordable housing costs in the city of Chicago about $60 a night; a decent hotel could be $150-175, over $600 on Michigan Ave; and an ER bed is going to cost you $1,500 for an in-patient stay and $10,000 on average. Hospitals are the most expensive; however, it is not really the "wrong pockets problem" but rather because those organizations that would most benefit from an investment in permanent supportive housing don't contribute their fair share. So, as Mark mentioned, his organization has to make up the difference in subsidies. He has to go to philanthropic partners to make up the difference to solve for short-term problems. And, in the end, the state probably benefits the most from that private investment, followed by the managed care organizations when others pick up the slack in these situations.
I ask this question a lot and have spoken with several economists and other experts to understand better why we can't think a little bit longer term on these issues? If we can predict how to avoid future costs for an individual with any common chronic disease, for example, diabetes, hypertension, asthma, heart failure, or any of those, essentially, the annual costs are going to be between $6k-$7k without a mental illness or substance use disorder. If you add on one of those, the health care costs are doubled. You add on both mental illness and substance use disorder, they're going to triple or quadruple in cost of care. And lastly, you add on homelessness, it gets even higher. One case study revealed that a man had 150 times the cost annually of a simple common chronic disease. An average is somewhere between 10 to 15 times. Why do these structural issues persist, and how do we motivate the state to address them? From previous administrations, a lot of those departments have been decimated, and they're all good people, but unfortunately, they don't always have the luxury of time or the bandwidth to invest in anything long-term. I would love to be able to see some investment to figure out the overall ROI (return on investment) for prevention that could go into calculating housing solutions and what the true reliance is on providing permanent supportive housing.
I wrote an article in 2016 called Mr. G and The Revolving Door. It is the story of a patient who was formerly incarcerated. He was 41 years old with congestive heart failure and could barely walk up or down the hallway. By the time he came to us, he had been homeless for several years prior to his incarceration, and he died 11 months later. If you looked at his then, it played out in meeting an IEP (individualized education program) when he arrived at the school. And because it was an IEP, he got further behind because he didn't have the family support required to help him do well. He dropped out as a preteen, drifted into gang activity, and then drugs. And the point is that this individual’s profile was not unique – I saw it repeatedly. We need a longer-term view when we look at supporting patients. We need to say that a penny here will save a dollar down the road. And that, to me, that's the next big challenge for us is to prove to our state officials, federal officials, and CEOs that investing in permanent supportive housing will result in a significant drop in utilization and costs. We've got great intel from North Carolina, and I have great data on this, but until we have that kind of political will to look beyond a year timeframe, you know, 10 or 20 years of a person's life, we're not going to be able to monetize that savings in ways that result in great outcomes.
EM: As we consider the ROI in the use case for investing in housing, it is often something that is very important to health care leadership both on the payer and provider sides. What have you realized in a year already into the program? What are some of the success factors and your outcomes? You mentioned some of the individual cost savings for the health plan, the medical loss ratio, etc. So, tell us more about that.
KD: There are several ways in which we can cross-examine the outcomes of some of the patients that have benefitted from some of these programs. For those that we had prior information on, we saw a decrease in emergency loans and inpatient stays. However, there was an increase in outpatient services. Rightfully so, as many of these individuals have chronic conditions that were previously untreated, so now, with additional supportive services, pharmaceuticals, and so on, the maintenance of their health is now being supported in a new way. Overall, it's about what is the best case of cost avoidance. There are going to be members that still drive higher costs, so it's a constant balance. There is a study currently being published to show what we learned; however, it does include a period over the pandemic – the study is from 2019-2021, so there are factors that are going to play out in the results that may have been different. Overall, the outcomes have shown 30 percent lower mortality rates for the individuals during this period, a 20 percent reduction in incarceration, a 9 percent reduction in emergency room visits, and a 33 percent reduction in in-patient stays. And then, if you look at the individuals with substance use challenges, those percentages are even higher. So, it is an investment. We have to look at it that way we have to invest in the process, continue to collaborate, and really see how we can make an impact. This is a complex problem, but as it is laid out in those outcomes, it will require us to come up with some other long-term commitments.
EM: As we continue to advocate for supportive housing, what needs to happen in order to make this a sustainable market?
FM: At Mercy Housing, we know our residents and where our residents are. And we know that when we connect them to services through a care coordinator or other managed care scenarios, we are supporting them in a connected and meaningful way. They have difficulty knowing where and how to reach the plans and systems, but we’re more than happy to connect them, help them make it to their appointments, access the pharmacy, and other ways in which we know can affect their health and wellbeing.
KD: I think we should look at models in other states. The Centers for Medicare & Medicaid Services (CMS) is looking at ways in which they can support and address what they refer to as “health-related social needs.” And there are a variety of ideas and pilots happening; for example, two states are incentivizing MCOs to reinvest profit into these types of programs.
SB: The flexible housing pool has been a bright spot here. We've now housed over a thousand people in the five years it's been in operation, it has been a great opportunity for partnership with CountyCare and others. However, we need to prioritize it at the state level. Any expanded state’s Medicaid budget consumes a quarter to a third of the entire state budget. In 2013 we outsource resources to MCOs, and it has failed to address the needs of patients.
What I see most often is people going into the Illinois Department of Corrections that come out without housing. We know that housing is one of the primary drivers of recidivism, yet we have people going into the state-operated psychiatric system that are not guilty by reason of insanity or couldn't stand trial. They come out, and they recidivate again. And so, what we need now is almost like flexible housing, version 3.0. We need the state to invest in flexible housing that would directly engage the MCOs to contribute to it. Because thus far, we've been doing it in a patchwork manner with varying interest levels from each MCO plan. We've had a great contribution from CountyCare and Meridian, but we need a state-led effort to eliminate this complex problem.
We also need to declare homelessness a public health crisis. I'm in a group called Chicago Homelessness and Health Response Group for Equity (CHHRGE), which comprises 30 organizations that have been meeting regularly since the beginning of the pandemic. Originally, we were trying to prevent shelters from becoming super spreader sites, which evolved into a great organization.
Every year, we have deaths of people experiencing homelessness because of the life-threatening weather in the winter. If you remember, we had a brutally cold snap in December; we patched it together and think we found about ten deaths there. But periodically, I'll hear about this person here or over there. But we're not reporting it in a systematic way to draw attention to the need for funding and permanent support. I found that only about 15% of the people that are in my shelter are getting into it. On one hand, on the other hand, we are sweeping people out of O'Hare and encampments. That's cruel, don't you think? And so, we need to frame this as a public health crisis. From a public policy perspective, it would be something that we really need to do, and I think we are trying to do that by helping the state build out a homeless health reform to begin to mobilize public policy on creating more resources for this population.
MM: ROI and sustainability are critical to our organization. We strive never to offer a program that we don’t believe can be sustained or that people will come to rely on because it would be defeating to those patients and participants. We also ensure to make partnerships with our funders and contractors that they are investing in and committed to these efforts; otherwise, it is not maintainable.
Currently, we receive $17 to $22 a day from the city to support homeless populations. This comes with the bureaucracy that accompanies coordinating and receiving those payments. We’ve added layers of challenges that end up spending more time trying to manage that small amount of revenue versus providing services. Housing can be a return on investment because when someone is stabilized, they can eventually pay rent, pay utilities, and contribute in a meaningful way. It may not be 20 percent returns, but enough to reinvest in the system to keep investing in people. We often look to the government to solve the problem; however, I often go back to wanting the government to be a responsible partner in the problem and that they help create systems that the funding matches the need. The government hasn’t really solved problems historically, but it can be a conduit and assist with coordination for bringing the system together to achieve the same goals.
As an agency, we adopted the model and view of value-based care. What is the value of the care we provide individuals? Because it does involve health care, housing, employment, education, parenting, and all the skills that are necessary to become independent. That drives costs down as people can sustain themselves holistically. And then, when you build it for a family, we can address some of the systemic issues that arise with generational challenges. If you solve the issue for the family, then their children are not victims of the system. They learn also and can become independent. And there can be a way to make these changes.
Photo Credit: Angad Ravanam / Instagram @ravanam.jpg