Want to keep people out of the hospital? Make sure they have a place to live.

By Harold Pollack, Published: November 2 at 11:00 am

CHICAGO -- In Illinois’ Medicaid program last year, 3.2 percent of patients accounted for half of all spending. The top 0.15 percent – 4,500 people in a program covering 3.2 million people – required annual expenditures upward of $285,000 each.

In the health-policy world, these heavy spenders are known as “frequent fliers:” patients with severe conditions, disabilities and life problems whose complex care accounts for such a disproportionate share of the medical economy.

However the health-reform debate proceeds in Washington, improving the quality and economy of care provided to this concentrated group will remain a central challenge.

A striking proportion of the patients with the most costly and complex conditions are either homeless or one step away from that in precarious or temporary housing. It stands to reason that providing secure housing to people with chronic illnesses might help.

"With our supportive housing units, we improve quality of life, improve health outcomes and save significant health care costs,” Arturo V. Bendixen, who runs the center for Housing and Health at the AIDS Foundation of Chicago, says.

A beautiful randomized trial conducted here in Chicago supports Bendixen’s claims. That study found that placing homeless people with chronic illnesses in supportive housing reduces emergency department visits, residential substance abuse treatment, hospital inpatient admissions and nursing home use. Researchers also observed average annual cost savings of $6,307, with greater average savings among the chronically homeless ($6,607) and among those living with HIV ($9,809). The sample size of 407 was too small to establish statistically significant savings, but the results were obviously promising, especially when housing services are focused on men and women with high expected medical costs.

Such studies are important, since there isn't enough supportive housing to go around. HUD budgets have taken a hit in recent years. America’s egalitarian and compassionate impulses are narrowly targeted to the domain of health — narrow to the point of self-defeating in serving such needy groups.

I am continually struck by this contrast. Patients secure impressive support from Medicaid when they need acute medical services. That’s as it should be. Yet it’s surprisingly hard and surprisingly controversial to provide more modest forms of help that are often more beneficial and cost-effective. In Chicago, it costs about $9,000 to house someone for a year in a plain but decent apartment. That’s less than the typical cost of one hospital stay. This $9,000 is hard to find.

Many people need a bit more help, too. They might need a case manager or visiting nurse to help with the logistics of appointments, to ensure the rent check is paid, to remind people to take their medications and to make sure prescriptions don't go unfilled because of a $5 co-pay. It’s probably not cost-effective to provide these services to everyone. It’s the smart and humane thing to do when someone has really costly and complex medical problems that generate repeated crises.

Alison Korte is a social worker and housing case manager for Heartland Human Care Services, a large Chicago nonprofit service agency. She works with recipients of Medicaid supportive housing. To be eligible for this particular program, one needed to be in that top 3.2 percent group of high-expenditure Medicaid recipients.

I recently visited two of Alison’s clients. I’ll use their first names to preserve a bit of privacy. But with their permission, I’ll show you some pictures, too. It’s important to see the human beings affected by public policies — particularly to see the human faces of individuals living with HIV and other ailments. These men and women bear the burden and stigma of so many stereotypes and misperceptions.

Haywood

Haywood (shown below with Alison) is 64 years old. Over the past several years, he has cycled through various states of shelter homelessness. He now lives in a one-bedroom apartment, where he’s been for seven months.

(Courtesy of Harold Pollack)

Haywood has experienced more than his share of medical difficulties. Like most extremely poor people, he needs eyeglasses and dental work. Like most people his age, he suffers from hypertension and diabetes. He takes seizure medication. He’s on baby aspirin.

Then there’s the other stuff. Three times a week, he attends an intensive outpatient treatment program to address his history of heroin and cocaine disorders. He neglected his health for years while living the street life. He served time for armed robbery and burglary, though he reports that he hasn’t had a case or police involvement since the year 2000. He got high every day. He missed doctors’ appointments, didn’t take care of himself. In 1997, he was diagnosed with HIV. He lives with hepatitis C, too.

Three years ago, he had a medical crisis. He went into the hospital for gall bladder problems, but an MRI identified spots on his liver. This led to an operation that went badly. His liver and his kidneys shut down. He had a heart attack and slipped into a coma. He was hospitalized for five months. That episode was a turning point in his life.

Given the back-story, you might assume that Haywood leads a wild and chaotic life. Maybe he did 10 or 15 years ago; not today. We chatted in the dining area of his tidy apartment. On a doctor’s prescription, he works out at a nearby Park District gym to control his diabetes. His HIV is down to undetectable levels. “My medical care is excellent,” he says.

He receives a monthly SSI check for about $700. One-third of it goes to housing. (The rest of his rent is subsidized through public programs.) In his soft-spoken voice, he says that he doesn’t socialize a lot. He doesn’t have much in common with the Arab Americans and Orthodox Jews in the immediate neighborhood. He does most of his socializing with people he meets in recovery meetings. He tries to avoid hanging out in places that might create the wrong temptations.

He lives modestly, eating out once or twice a month. His grandchildren sometimes come down from Wisconsin to stay with him. He’s planning a trip to see them. It’s not a bad life settling into late middle-age, especially when you compare it to what came before.

Antonia

(Courtesy of Harold Pollack)

Antonia has lived in a similar apartment for about 18 months. At 54, she has had various transitional housing arrangements before getting her current place. Like Haywood, she’s been a Medicaid frequent flier. Within the past year, she was hospitalized 10 times, mostly for asthma or related respiratory problems. She’s also been diagnosed with hypertension, type II diabetes, neuropathies, bipolar disorder. She had a hip replacement not long ago. She has been living with HIV since 2005.

A licensed practical nurse, Antonia has held various jobs. She also depends on SSI, which leaves her with about $500 a month for living expenses. We talked about her daughter, who spends 15 hours a week helping her. We also talked about her granddaughter in middle-school.

I asked how her life had changed with the move to this apartment. “I’m not getting bitten,” she said, referring to the bugs that infested her old place. “My pressure is stable because I feel safe over here. As opposed to over there, because people were using drugs in the laundry room, in the stairway.”

Life isn’t magically transformed just because one lives in supportive housing. Antonia bears a nasty stripe across her forehead. Two months ago, she was clobbered with a tire iron by a mugger who snatched her necklace. Dealing with depression, stress and fear arising from this incident, Antonia skipped some doses of her HIV medication and now faces new medical problems. There are no miracles in life.

Yet having a clean and safe apartment is central to both Haywood's and Antonia’s lives. It’s hard to care for yourself when you have no place to sleep, when you lack a refrigerator for your diabetes medicines, when you have no private space to regroup as you experience whatever you are dealing with. When you can invite a friend or your grandchild to an attractive safe space for a pleasant visit, that’s no small thing, either.

Supportive housing doesn’t work for everyone. It’s no coincidence that Haywood and Antonia are older than many other clients. Many chronically homeless aren’t as ready. They've lived the street life for years. Suddenly they have rent to pay. They have to keep up an apartment. They are expected to be quiet neighbors. Their landlords don’t want them to bunk their friends. They are lonely and bored, living alone in a small apartment. For some, the transition is just too much.

Some need other options, including harm-reduction approaches for people who maintain some level of continued drug or alcohol use. In an expensive city such as Chicago, economic and zoning practicalities nudge supportive housing into some of the toughest low-rent neighborhoods, where residents face some of the same social challenges and cues for renewed substance use they are trying to avoid.

Still, with all the caveats, we can improve and stabilize people’s lives by improving and stabilizing the physical conditions in which they live. We’ll need an unsentimental randomized trial to know the true financial payoff of such interventions. The human payoff is already visible, and is no less compelling.

(I’d like to thank the AIDS Foundation of Chicago’s Arturo Bendixen and Jessie Beebe and Alison Korte of Heartland Human Care Services for their help facilitating these interviews.)