Study Finds Affordable Housing Reduces Health Care Costs

A study conducted by the Center for Outcomes Research and Education (CORE) and sponsored by Enterprise Community Partners found affordable housing reduced overall health care expenditures by 12% for Medicaid recipients. Researchers attribute these savings to more cost-efficient use of health services, with an 18% decrease in costly emergency department (ED) visits and a 20% increase in less costly primary care services. The cost savings came without compromising access or quality of care to residents.

Researchers looked at 1,625 individuals across 145 properties in three types of affordable housing: general family housing (FAM), permanent supportive housing (PSH), and housing for seniors and people with disabilities (SPD). They compared individuals’ Medicaid claims in the year prior to moving into affordable housing to their Medicaid claims in the year after moving in.

Individuals’ Medicaid health care expenditures decreased on average by 12%, or $48 dollars per month, after moving into affordable housing. The decline was most significant for individuals in PSH and SPD, who saw an average savings of $84 per month. The study estimates that total annual savings to Medicare would be $936,000 for these 1,625 individuals.

The savings in Medicare expenditures came from a reallocation of health care services that occurred after individuals moved into affordable housing. These individuals increased their use of primary care services by 20%, but decreased their visits to EDs by 18% in the year after moving into affordable housing. Individuals in PSH experienced the most significant changes, increasing their primary care visits by 23% but decreasing their ED visits by 37%.

A subsample of 275 individuals living in 12 properties completed a survey about access to and quality of care after moving into the affordable housing. Forty percent of those surveyed reported that their access to care had improved, 50% reported that it remained the same, and 4% percent reported a decrease. The most significant improvement was among individuals in PSH, 59% of whom reported an improvement in access to health care. The findings were similar for quality of care: 38% reported an increase in quality of care, 48% reported no change, and 7% reported a decrease. Again, the most significant improvements were for individuals in PSH and SPD, with 46% and 42% reporting better quality after moving into affordable housing.

The study also examined which types of onsite services – health, social, or wellness – most affected the frequency of ED visits and total Medicaid health care expenditures. Health services were broadly defined as medical, mental health, or dental services involving doctors, nurses, and other health professionals; social services were defined as assistance with psychosocial needs involving community health and social workers; and wellness services were defined as assistance with general wellness involving staff who assist with food access, fitness, and other residential activities. Health services had the greatest impact, reducing ED visits by an average of .43 visits per person per month and expenditures by an average of $115 per person per month. Social services increased health expenditures by an average of $69 per person per month but had no impact on ED visits. The study’s authors concluded that social services may increase awareness of and access to health care services. The scope of the study did not allow for the measurement of longer term health benefits.

Health in Housing: Exploring the Intersection Between Housing & Health Care is available at: