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Why more Chicago hospitals are getting into the housing business

Thursday, January 11, 2018
Crain's Chicago Business
by Kristin Schorsch

Having hospitals chip in to shelter their patients hasn't caught on rapidly in Chicago, but city officials are starting to see more interest. The latest batch of hospitals finding housing for their chronically homeless patients—or planning to—include UChicago Medicine, Rush University Medical Center and Swedish Covenant Hospital.

More hospitals have sought details on how to launch such a program, including prominent Northwestern Medicine, said Stephen Brown, director of preventive emergency medicine at University of Illinois Hospital & Health Sciences System. He spearheads the Better Health Through Housing program at the Near West Side-based academic system and leads a local committee where hospitals discuss how to intertwine health and housing.

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The idea can be a tough sell.

"For a hospital to be affiliated with the homeless, if you would look at that from a marketing perspective, some people might say, 'Hey, do I want to go to a hospital where there's homeless?' " explains Swedish CEO Anthony Guaccio. "It's really just the right thing to do, and we need more people to stand up."

Swedish, a community hospital on the North Side, is housing 10 homeless patients, while Rush, a Near West Side academic hospital, has plans to house up to five patients beginning this spring. UChicago, an academic system on the South Side, is planning a program, a spokeswoman says. No other details were available.

Here's why there's a growing movement among hospitals to help their patients find apartments in their communities. Research shows having a home reduces ER trips and hospitalizations as well as jail and detox time. A permanent address also boosts the rates that patients regularly see doctors who focus on prevention. Hospitals save money by not providing unnecessary care for little or no reimbursement. Homeless people are often uninsured or on Medicaid.

So how do you get hospitals on board? For one, talk about the potential boost to their bottom lines.

"They want to hear about utilization and costs going down," said Dr. Julie Morita, commissioner of the Chicago Department of Public Health.

In 2015, she hosted a City Hall meeting with hospital executives to tout the idea of partnering with nonprofits to house their most vulnerable patients. Watch them become healthier, and their medical costs could drop. Morita nods to Healthy Chicago 2.0, a 2016 blueprint of sorts that outlines how to make Chicagoans healthier. That includes finding people stable homes.

UI Health's pilot program in 2015-16 had some initial success. The system spent about $250,000 to house 26 patients. The average monthly medical costs per person declined from about $5,900, to around $4,800 after they found housing. That only includes care provided by UI Health. While not every patient from the pilot program remains in housing for various reasons, UI Health plans to spend another $250,000 to house an additional 25 people.

At Swedish, the hospital is partnering with the Center for Housing and Health, which is also UI Health's partner. The nonprofit will pay for the housing with a federal grant, while Swedish will spend about $75,000 on support services, such as treating patients for drug or alcohol addictions.

Swedish ER clinical director Kimberly Leslie is helping to find potential candidates for the program. Each month, she combs through a list of the top 50 frequent ER users to see if they list a home address. Some do—but it's a church or a friend's house. The work is tedious, time-consuming and a big gamble. But it could lead to savings for the hospital if they can help their patients get healthy and reduce expensive ER visits.

"In the long run already, our first patient we placed, staff were really excited when they saw her coming out of Jewel with a bouquet of flowers," Leslie says. "We can take care of their wounds and their illness, or we can take care of the whole person."

Swedish has committed to the program for one year. Rush's plan is still in its infancy, but the hospital is modeling it off of UI Health's program, a spokeswoman says.

The Cook County Health & Hospitals System, considered the medical safety net for the region, partners with Housing Forward on 33 units in the south suburbs and might forge another partnership for more housing. The federal government pays for the apartments, while the health system spends about $400 a month per unit on services, such as helping people get used to their new environment, show them how to buy food and make sure they go to the doctor.

"We kind of look at who is in danger of not being able to stay well due to their lack of housing, for people whose disease requires a high degree of self-management in order to stay well," such as someone with diabetes, says Mary Sajdak, chief operating officer of integrated care services for Cook County Health. "It's about not losing your medications because you have to keep them in your pants pocket or you need to keep insulin stored so it doesn't lose its efficacy."

Meanwhile, to help make the UI Health program financially sustainable, Brown is pitching private insurers who cover Illinois Medicaid patients to share in the cost of housing. After all, the insurers are paying the hefty medical bills for people who flood hospital ERs for unnecessary care.

Here's the potential impact. Brown looked up how much about 600 of its homeless patients cost going back to 2016—32 percent are the most expensive patients within UI Health, costing seven to 70 times more than the average patient, Brown said.

"If the state is going to start putting pressure on (private insurers) to reduce the cost of Medicaid, they're going to have to start to be more creative," said Brown, a former Motorola sales manager turned social worker. "We can help them."



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