Homelessness: health service use and related costs.

OBJECTIVES: This study examines health service use and costs for homeless and domiciled veterans hospitalized in psychiatric and substance abuse units at Department of Veterans Affairs (VA) medical centers, nationwide.
METHODS: A national survey of residential status at the time of admission was conducted on all VA inpatients hospitalized in acute mental health care units on September 30, 1995. Survey data were merged with computerized workload data bases to assess service use and cost during the 6 months before and after the date of discharge from the index hospitalization.
RESULTS: Of 9,108 veterans with complete survey data, 1,797 (20%) had been literally homeless at the time of admission, and 1,380 (15%) were doubled up temporarily, for a total homelessness rate of 35%. Combining patients from general psychiatry and substance abuse programs, the average annual cost of care for homeless veterans, after adjusting for other factors, was $27,206; $3,196 (13.3%) higher than the cost of care for domiciled veterans (P < 0.0001). Approximately 26% of annual inpatient VA mental health expenditures ($404 million) are spent on the care of homeless persons.
CONCLUSIONS: Homelessness adds substantially to the cost of health care services for persons with mental illness in VA, and most likely, in other "safety net" systems that serve the poor. These high costs, along with the prospect of declining public funding for health and social welfare programs, and an anticipated increase in the numbers of homeless mentally ill persons, portend a difficult time ahead for both homeless patients and the organizations that care for them.