Cost-effectiveness of Supported Housing for Homeless Persons With Mental Illness

Robert Rosenheck, Wesley Kasprow, Linda Frisman, and Wen Liu-Mares

September 2003

In 1992, the US Department of Housing and Urban Development (HUD) and the US Department of Veterans Affairs (VA) established the HUD-VA Supported Housing (HUD-VASH) program to assist homeless veterans with mental illness and/or substance abuse disorders.  In this study, homeless veterans with psychiatric and/or substance abuse disorders or both (N = 460) were randomly assigned to 1 of 3 groups: (1) HUD-VASH, with Section 8 vouchers (rent subsidies) and intensive case management (n = 182); (2) case management only, without special access to Section 8 vouchers (n = 90); and (3) standard VA care (n = 188).  During a 3-year follow-up, HUD-VASH veterans had 16 percent more days housed than the case management-only group and 25 percent more days housed than the standard care group. The case management-only group had only 7 percent more days housed than the standard care group. The HUD-VASH group also experienced 35% and 36% fewer days homeless than each of the control groups. There were no significant differences on any measures of psychiatric or substance abuse status or community adjustment, although HUD-VASH clients had larger social networks.  Researchers concluded that supported housing for homeless people with mental illness results in superior housing outcomes than intensive case management alone or standard care and modestly increases societal costs.

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