CHP: NYS Chronically Underinvests In Housing For People With Mental Illnesses, Nonprofits Say

Monday, October 23, 2017

NYAPRS Note: Another piece from the Bring it Home campaign that is actively supported by NYAPRS.

State Chronically Underinvests In Housing For People With Mental Illnesses, Nonprofits Say
Crain’s Health Pulse October 23, 2017

Chronically low rates from the state Office of Mental Health are forcing some housing nonprofits to avoid contracting with the agency to provide housing and services to people with mental illnesses, an industry association said.

OMH rates do not keep pace with inflation, rising rents and the cost of living in the city, according to the Association for Community Living, a group representing nonprofits that provide housing and rehabilitation services to 30,000 New Yorkers with psychiatric disabilities.

"Every year I go to the government and explain the problem to them," said Antonia Lasicki, executive director of the association, which recently launched an advocacy campaign for higher housing rates. "Some years we get a little bit of money, but we don't get enough. And we have no automatic mechanism in place to get additional funds."
OMH said the state is investing significantly in supportive housing.

"Supportive housing is a priority for OMH and Gov. [Andrew] Cuomo," OMH said. "During the last four years, OMH's budget has committed more than $32.5 million to increase funding for existing single-room-occupancy units and supported-housing stipends to help cover higher rents in counties facing the greatest fair market value cost pressures. Additionally, the governor's commitment is evidenced by the creation of the Empire State Supportive Housing Initiative to expand capacity throughout the state, and more than $60 million in resources for cost-of-living adjustments to stabilize existing community mental health programs."

The OMH budget included a 0.2% cost-of-living adjustment in fiscal 2017, but Lasicki said it was not enough.

OMH rates vary depending on the housing model. For supported housing, OMH would pay about $16,656 per year to a nonprofit that houses someone with a mental illness in a one-bedroom apartment in Manhattan and provides them with services. Clients also contribute 30% of their income—typically $247 of the $822 they get per month through the federal government's Supplemental Security Income program.

The Association for Community Living estimates that an adequate annual rate for supported housing would be $21,349 per client. That's 27.5% more than providers are getting, which the association says does not adequately cover the cost of housing (fair-market rent in Manhattan, for example, is $17,028), salaries and other expenses. "There are many providers now who will not respond to an RFP from OMH," said Lasicki. "But they still have enough that do, so they're not too concerned about it."

Low rates are a significant concern for ACMH, a nonprofit that recently took over seven OMH-funded housing programs with 427 beds from Heritage Health and Housing. OMH added $7.1 million to its contract with ACMH following the acquisition, but that funding includes one-time startup costs, said Daniel Johansson, ACMH's chief executive. He said the organization is still trying to negotiate for more money.

He sees his organization's expansion of its housing portfolio as a "calculated risk" that could pay off if it can get new revenue down the line from the health care system's shift to value-based payments, which reward providers for keeping patients out of hospitals.

"We believe that even though we're operating at a thin margin now, as we move forward in health care reform, value-based payers will begin to see housing as a critical part of staying out of the hospital," Johansson said. — C.L.