Homeless care

State bill pairs housing aid with Medi-Cal to ease burdens

While AB 74 would not subsidize rent for every homeless person, such as those who find respite at Chico City Plaza, the bill could house some who receive Medi-Cal benefits.

While AB 74 would not subsidize rent for every homeless person, such as those who find respite at Chico City Plaza, the bill could house some who receive Medi-Cal benefits.

Photo by Evan Tuchinsky

Track the bill:
Read the text and follow the progress of this proposed legislation at leginfo.legislature.ca.gov (search “AB 74”).

North State residents can’t get too far from home without coming across people lacking homes. Approximately 1,200 people live on the streets of Butte County—up to 500 of them homeless for at least five years. Some find beds in shelters; many lay in city parks, on downtown doorways, along creeksides or under bridges.

Routinely, police and paramedics encounter homeless people, too, particularly those battling mental illness, chronic disease and/or substance abuse.

Shelter correlates with well-being. As DeAnne Blankenship of the California Healthcare Collaborative explained: “It’s hard to be healthy, it’s hard to operate at peak health, if you don’t have a home, if you don’t have a way to get out of the elements, make sure you have nutritious food and be safe.”

Based in Chico, Blankenship is program services director for the CHC, a nonprofit that promotes wellness. Her organization puts particular emphasis on underserved communities; efforts include homeless outreach.

“We have people who we’ve met in our case management work who go to the emergency room a lot, sometimes just because it gets them to a place where they know they can eat and get out of the weather,” she said. “There are people who go to the emergency room a couple times a day.”

Not only does this put a strain on capacity, tying up first responders and ER resources in nonemergency situations, “all that drives up expenses,” Blankenship added. In the case of hospital visits, for patients covered by government-funded Medi-Cal, the state gets billed.

Legislators have noticed. Assemblyman David Chiu (D-San Francisco) has introduced a bill, currently with five co-sponsors, that would extend state housing support to benefit homeless people with physical/developmental disabilities and those with mental health disorders.

Allocations would total $90 million for five years, starting in 2019. The national nonprofit Corporation for Supportive Housing estimates the funding would cover 1,500 people at any one time and yield savings in Medi-Cal expenditures of up to $60 million over the five years (plus recoup the cost).

Assembly Bill 74 passed two subcommittees and is scheduled to be heard by the Appropriations Committee May 26.

“I think it makes sense,” Blankenship said. “If the savings were put back into Medi-Cal, then that would be ideal …

“It seems like a great use of funds to fund prevention, and housing is prevention. Since we spend so much on sickness and keeping the ‘sick industry’ in business, it seems to me [this plan] can’t do anything but help bring down those expenses.”

Ed Mayer agrees. He’s executive director of Butte County’s Housing Authority and a vice chair for the Butte Countywide Homeless Continuum of Care, which coordinates services provided by local agencies.

“This is significant because it involves the state of California stepping up to acknowledge that, in order to make Medi-Cal efficient, you have to hook health up to housing,” Mayer said. “We’re seeing chronically homeless persons incur greater than a half-million dollars in health care costs in emergency rooms a year. If you get them off the streets and house them, with some supportive services … you save boatloads of money.”

The “holistic approach” also has human benefits—well-established and proven. The Housing Authority already partners with the U.S. Department of Veteran Affairs for the HUD-VASH program (Veterans Affairs Supportive Housing), which provides vouchers for rent and case management for medical needs. HUD-VASH has housed 120 homeless vets in Butte County over the past three years.

“That’s a success story,” Mayer said, “but housing and services is really key to almost everything in solving the worst part of our homelessness [challenge].”

Don Taylor, assistant director of clinical services at the Butte County Department of Behavioral Health, concurred that AB 74 “is not a new concept.” What’s new, he said, is placing responsibility for health onto the state Department of Housing and Community Development (HCD). AB 74 would require HCD to establish a program titled Housing for a Healthy California by Oct. 1, 2018, and start funding competitive grants by April 1, 2019.

“From a clinical perspective, it makes all the sense in the world,” Taylor said. “All the data shows that it works the best if you’ve got someone who’s chronically homeless—may be medically compromised, [may] have a mental health issue or substance abuse problem on top of it—having all partners collaborate, you get the best long-term outcome for the individual.”

The estimate of 1,500 beneficiaries from AB 74 represents a fraction of the homeless population statewide. Mayer said Los Angeles alone has 60,000; Taylor, his fellow Continuum of Care vice chair, said the funding block could go just to covering the northern Sacramento Valley—“forget the urban areas”—so he sees AB 74 as “a pilot” that the state will assess before devoting more money.

The scale may appeal to Gov. Jerry Brown, who opposed a similar homeless housing proposal last year. Mayer said Brown has expressed concerns about the cost of new construction, as well as the NIMBY (not in my backyard) complaints that often obstruct affordable housing projects.

Moreover, the scale may prevent AB 74’s program from overwhelming agencies such as Mayer’s. Vacancy rates for public housing across California already have dipped below 1.5 percent. Applicants in Butte County now can face a 90-day waiting list.

Nonetheless, Mayer finds the bill encouraging.

“This [model] has been around for a long time—finally California is getting after it,” he said. “It seems the state is getting sensitized to the issue and taking action. Maybe late, but better late than never.”