National Alliance on Mental Illness
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Study Reveals Cost To Society For Housing Homeless Persons With Mental Illness Is Essentially Equal To
Cost Of Remaining Homeless

For Immediate Release, May 4, 2001
Contact: Chris Marshall

A comprehensive study released May 2 by researchers at the University of Pennsylvania Health System in Philadelphia released this week reveals that not only is it just to provide supportive housing for homeless persons with mental illnesses, it is also cost-effective. This new study supports NAMI's contention that costs to taxpayers for supportive housing for individuals who are homeless and have a mentally illness are nearly the same when these individuals are left out on the streets, denied access to treatment and services, and forced to increase their use of crisis services and emergency care.

University of Pennsylvania researchers conducted a five-year study that examined 10,000 homeless persons with mental illnesses in New York City. Half of this group were placed in government-funded housing with mental illness services available. The homeless persons who were not placed in supportive housing cost the taxpayers an average of $40,500 a year for their use of emergency rooms, psychiatric hospitals, shelters, and prisons.

However, those individuals who were placed in supportive housing with assistance for mental illness issues, used much fewer emergency care services. The study found that cost to taxpayers for providing supportive housing and treatment to homeless persons with mental illnesses cost only $994 more than the $40,500 cost to do nothing and leave these individuals homeless and on the streets.

Nationally, it is estimated that there are 110,000 persons with mental illnesses that experience chronic homelessness. This comprehensive study concludes that the net cost of ending homelessness for this population, using the most conservative estimates, is negligible. In other words, it costs essentially the same amount to house people as it does to leave them homeless.

For more information on this research, and a link to the report, go to

To access the study directly online, go to

NAMI members and advocates are strongly encouraged to examine this report and use it when advocating for a dedicated stream of resources for supportive housing for homeless individuals with severe mental illnesses in your community. As Congress begins the debate over FY 2002 appropriations for the US Department of Housing and Urban Development (HUD), it is important that NAMI members and advocates voice their support for funding for supportive housing - independent housing linked to comprehensive treatment and employment services. In testimony recently submitted by NAMI to Congress, NAMI stressed the following advocacy points to address housing issues for people with severe mental illnesses:

- NAMI strongly recommends stable funding of renewal for both Shelter Plus Care & Permanent Supported Housing Programs rent subsidies that protect the interests of formerly homeless individuals with severe disabilities. NAMI believes that the best way to accomplish this goal is to shift the budget impact of future renewals to the Section 8 program. If this is not possible, then NAMI wold urge the continuation of funding a separate account for renewals within the overall McKinney-Vento Homeless Assistance program.

- NAMI strongly recommends continued support for the 30% permanent housing set-aside within the McKinney-Vento program. As this new study demonstrates, and numerous other studies have shown, permanent supportive housing is an effective model for ending the difficult and costly cycle of jail, the streets, shelters and hospitals homeless persons with severe mental illnesses. NAMI urges that the permanent housing set aside be kept in place to continue the efforts to further a federal policy designed to end homelessness. NAMI believes that this minimum threshold for permanent housing is essential to federal efforts to support policies that move toward ending homelessness - as opposed to building a permanent infrastructure of service programs that result in maintaining a permanent homeless population.

- NAMI strongly recommends that agencies at the Department of Health and Human Services including SAMHSA and CMHS better target its resources toward services for homeless people with mental illnesses. More needs to be done to hold these agencies accountable for providing the services this populations needs to move toward recovery and stable, independent lives that prevent them from ever returning to homelessness.

For a copy of NAMI's testimony delivered to the House VA HUD Appropriations Subcommittee click on

For more information on NAMI positions and advocacy goals on housing, go the NAMI's Where We Stand paper at