Cost Reduction

UI Health Cuts ED Homeless Patient Costs by 45 Percent

December 1, 2017 1:01 pm

“This is a low-risk entry point for hospitals to get involved in population health,” says Stephen Brown of UI Health.

In 2015, the University of Illinois Hospital & Health Sciences System (UI Health), Chicago, launched an innovative housing program that has helped the public hospital curb the costs of caring for homeless patients while developing its population health capabilities.

The program, called Better Health Through Housing, is focused on the chronically homeless, who account for 10-20 percent of the overall homeless population and nearly 80-90 percent of the total government costs, including health care, spent on homeless individuals.

To fund the program, the hospital pays $1,000 per patient per month to an outside agency to house 26 homeless patients in furnished, one-bedroom apartments and single-room occupancy units, along with a supportive case manager. This investment is significantly less than the nearly $3,000 per patient per day that UI Health and managed care organizations spent on some chronically homeless patients.

In the first three months of the pilot, UI Health realized a 45 percent reduction in costs accrued to the health system, says Stephen Brown, director, preventive emergency medicine. Emergency department (ED) utilization among patients in the program has dropped 21-62 percent, depending on the sample. Brown credits this steep drop in costs and utilization to the housing program’s 57 percent two-year retention rate.

Because patients are placed in neighborhoods across Chicago, it is possible that they could be appearing in other EDs, Brown says. However, he believes that utilization has likely decreased at other hospitals. Often, homeless patients come to EDs searching for food or a warm place to sleep, which they no longer need when they have permanent, supportive housing.

One chronically homeless individual who was recently placed in housing had 78 ED visits in 12 months for benign complaints like leg pain and diarrhea. Now that he has stable housing, the UI Health team is trying to get his HIV under control and uncover the cause of his significant neurological impairment. Another patient who is now in stable housing once had 102 ED visits over a 12-month period.

“Without the basic stability and dignity of having a place to lay their head every night, it’s very difficult for people to attend to their medical needs,” Brown says.

In a recent sample, 32 percent of homeless patients at UI Health were in the top decile of the most expensive patients. These patients’ costs ranged from approximately $51,000 to $533,000—seven to 76 times the average UI Health patient cost ($6,900).

Another internal study found that 11-14 percent of homeless patients’ healthcare costs were uncompensated, accounting for $635,900 to $855,000 of $5.6 million in total care costs for the cohort.

Putting the Program in Motion

In 2015, UI Health invested $250,000 to fund the program, which is also supported by philanthropy and subsidies from the U.S. Department of Housing and Urban Development (HUD). Brown and his team partnered with an outside agency, the Center for Housing and Health, to develop the program based on a model called Housing First. Two-year retention rates in programs like the nationally validated Housing First model are typically more than 80 percent, significantly higher than the 20 percent retention rates associated with traditional models that required the homeless to get treatment before securing housing, Brown says.

Individuals live in their own apartments and a case manager troubleshoots what they might need. “These case managers have low case loads so they can put the attention on the individual,” Brown says.

The program is designed for patients who have been homeless for the past 12 months or those who have had at least four episodes of homelessness within the previous three years. To be eligible, individuals also must have visited the ED three times in the previous 12 months and have a disabling condition, such as substance abuse, or mental or physical illness.

A panel of social workers, emergency medicine physicians, and psychiatrists, meet to review potential candidates for the program. Candidates’ information is shared with another agency’s outreach workers who then try to locate individuals and invite them into the program.

Realizing the Benefits

In addition to promoting health equity and reducing costs, the housing program has other advantages. For example, in 2016, the IRS began allowing health systems to claim a tax benefit on their community benefit statement.

It also has improved ED efficiency by reducing utilization. Before implementing the program, nearly half of the ED’s 100 most frequent visitors were homeless. Typically, visits with homeless patients take two hours longer than those with other ED patients. With fewer visits from homeless patients, ED staff can get more done.

In fact, Brown says the program has even improved provider satisfaction in the ED, which is known for high rates of burnout. Staff are not as discouraged from seeing the same homeless patients repeatedly. “These empowering programs show that we are actually changing conditions outside of the walls of the hospital,” he says.

Heeding Lessons Learned

Brown offers the following advice for organizations that are interested in developing similar programs.

Follow the Housing First model.  This model does not require psychiatric treatment or sobriety as a condition for receiving housing. In such a model, supportive case managers help patients pay bills, get to their medical appointments, and guide them through other daily activities.

Build partnerships with outside agencies By working with community partners, UI Health can offer patients a broader range of housing options. Currently, there are 27 agencies with single-room occupancy units and one-bedroom apartments scattered across the city. This encourages self-determination by giving individuals a choice where they want to live, Brown says.

Use data to identify the homeless.  UI Health has developed a prototype tool that alerts staff when a homeless patient presents to the ED. The tool links their electronic health record (EHR) system to a HUD database of homeless people in the region. “Just knowing when someone walks in the door whether they are homeless is a big help for us,” Brown says.

Take time to build trust.  “It takes a great deal of patience to engage with this population, and if you don’t get them the first time, you know they will be back, and you try to get them the next time,” he says. “It took some people two months before they would believe that we were offering them free housing.” An agency’s outreach workers, social workers, or housing case managers also can help build relationships.

Recognize that health outcomes, other than quality of life, may not improve.  Chronically homeless patients face enormous health challenges, including a five-year mortality rate similar to some cancer populations. They also have high rates of HIV, hepatitis, head and neck cancer, and traumatic brain injuries. “We can improve the quality of their life by getting them into housing and mitigating some of the symptoms of the chronic disease, but national studies show their outcomes may not improve significantly,” Brown says.

Preparing for Population Health

In the future, shared-risk arrangements could help health systems like UI Health better manage the homeless population, Brown says. But for now, programs like this can help hospitals develop an infrastructure to manage specific patient populations. “In my mind, this is a low-risk entry point for hospitals to get involved in population health,” he says.

Brown is exploring how other cities fund similar programs, such as by using common flexible housing subsidy pools. This would free organizations from the grant restrictions that often limit who they may serve through their housing programs. At press time, three more Chicago hospitals had joined the program, which is currently funded through the end of FY19. “If we were all to do this collectively with all Chicago hospitals, we would reduce the population of the chronically homeless in the city of Chicago by one-quarter to one-third. That is a major impact,” he says.

Although Chicago is just getting started compared with cities like Portland, where payers and providers have committed $21.5 million to house the homeless, Brown is hopeful. “I’m optimistic that can happen here,” he says. “I’m beginning to feel like we’re all moving in the same direction.”

Interviewed for this article:

Stephen Brown, MSW, LCSW, PMP, is director, preventive emergency medicine, University of Illinois Hospital & Health Sciences System, Chicago.


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