Posted by Sven Berg
Right now, Pay for Success looks like so much jargon on a very boring piece of paper, but it could change the fundamentals of homelessness in Ada County.
Boise Mayor David Bieter’s assistant, Diana Lachiondo, has taken it on herself to cobble together an alliance of groups that stand to save some pretty significant coin by getting chronically homeless people off the streets and into stable homes, especially if those homes come with supportive services such as addiction and mental health treatment and basic life coaching.
Who’s on the list of potential savers? Just imagine a homeless person getting into legal or health trouble, then imagine all the services that will come to bear, and you pretty much have your answer. Hospitals save people who’ve passed out so drunk or high that their survival is no longer guaranteed. If these people are sleeping outside, exposed to the elements night after night, that complicates the issue.
Treatment is expensive. So is the ambulance ride. So is law enforcement response to problems that arise among chronically homeless people. And who’s going to pay? Certainly not a person whose best source of income is begging for loose change on a street corner. Hospitals and taxpayers are stuck with the tab.
The point is that responding to homeless people's emergencies is far more expensive than a home. The city of Boise estimates it would save anywhere between $12,800 and $48,200 per year, per chronically homeless person
The savings are a big reason places like Salt Lake City has moved to a 'housing first' approach to chronic homelessness.
But there's a problem here: a big upfront cost — Lachiondo estimated it would be somewhere north of $2 million — to provide permanent, supported housing for Boise's 80 to 90 chronically homeless people.
Any group that unilaterally pays for the housing would recoup only some of the savings, so it would be a big expense. But good luck trying to convince a handful of governments and hospitals to collectively squeeze a few million out of their budgets for construction and long-term maintenance of 90 housing units, not to mention work out which one pays how much and for how long.
Here's where Pay for Success comes in. Instead of those groups fronting the cost, a third party, probably a non-profit or private business, would put up the money. If the housing leads to the expected savings, the funder would get some of the money as a return on its investment. If there are no savings, the funder loses its money.
In this scenario, the city of Boise, hospitals, Ada County and, potentially, a few other groups have nothing to lose. They either save money or they stay on the status quo. It's fiscally responsible — always a popular label for politicians.
That's why I think Pay for Success could be the breakthrough that leads to a housing first approach for Boise's chronically homeless people.
There's a lot left to do. Local government entities and the hospitals have to work together (a tall order in itself). Someone has to work out a realistic prediction of how much money could be saved by housing the homeless. Even if all that gets done, there's no guarantee a funder will bite.
But there's a chance it could all work out. Stay tuned.