SHA

The Supportive Housing Association of New Jersey

THE STATUS OF SUPPORTIVE HOUSING IN NEW JERSEY

FOR PERSONS WITH MENTAL ILLNESS

SOLUTIONS FOR EXPANSION

PRODUCED BY: WENDY TRULL

EXECUTIVE SUMMARY

As a state-wide membership association and industry advocate, the Supportive Housing Association of New Jersey (SHA) has worked with supportive housing provider agencies in building their capacity, and has watched the number of units grow substantially over the past five years. Much of this growth has been catalyzed through various Division of Mental Health Services (DMHS) funding initiatives, and by provider agencies’ ability to creatively patch together other funding streams for housing and services. With these available resources, agencies have been highly successful in providing greater access to supportive housing. As this process enters a new stage of growth, this effective approach to housing persons with severe mental illnesses in the community faces new challenges, requiring a fresh look at the industry’s status and a willingness to innovate.

The purpose of this report is twofold.

¨ First, an analysis of the present status of supportive housing: as this is a very young industry, SHA is interested in establishing the extent to which providers have been able to adhere to SHA’S philosophy and descriptions of the model. It was determined that there was a consistent adherence to the model and philosophy on the part of agencies, and the conclusion of this report is that this fidelity to standards should be considered a motivation for expansion.

¨ Second, an analysis of the barriers to expansion of supportive housing and proposals to overcome them: SHA is seeking a greater understanding of the barriers that do exist in expanding the model, in order to offer possible courses of action that SHA and the State might undertake to push the industry forward.

Methodology

Interviews were conducted with administrative staff of ten supportive housing providers and data was collected from the interviewed agencies as a means of determining basic outcome indicators and the status of the current industry base. The ten agencies reviewed for the purpose of this report represent approximately one-half of the DMHS supportive housing contract agencies and one-third of SHA’s service provider agencies. An established interview protocol was used in order to identify the barriers and challenges of expansion from the agency’s perspective. Interviews were also conducted with staff from DMHS, Corporation for Supportive Housing Connecticut. Project, and agency staff from three other states in order to compare New Jersey’s strategy for funding supportive housing.

Part One:

Assessing the Status of Supportive Housing For Persons With Mental Illness

Review of SHA provider agencies suggest a strong industry base

As a model nationally, supportive housing has a proven track record that has been confirmed by the review of New Jersey provider agencies; there is a strong and successful local industry base. The member agencies interviewed report to have implemented the model with consistency and have adhered to the philosophy of the model. For example, all agencies surveyed had tenants with their own leases, access to 24-hour services, and did not require that tenants utilize services in order to retain housing.

Preliminary outcomes indicators identified in this review suggest that tenants have been highly successful in maintaining their housing, with a possibly higher tenure rate than in other major studies. Member agencies also reported an average employment rate of 20%. These positive outcomes are further supported by national data that reports lower uses of emergency and inpatient care, a high rate of housing tenure, and decrease in symptoms of depression and schizophrenia.

The review also indicated that consumers living in supportive housing have a wide variety of special needs, including medical and substance use issues. All agency staff reported that mental health consumers can be housed in supportive housing settings successfully. The one exception consistently noted was for persons with severe cognitive disorders.

insufficient access to supportive housing units

Though there has been a major shift in funding from an institutional system of care to a community- based system, there still remain large waiting lists of consumers in the State hospital system and the community in more restrictive settings. According to surveys conducted by NAMI New Jersey and DMHS, in 1999 there were over 1,800 mental health consumers ‘stuck’ in the continuum of care.

According to average figures on these waiting lists, the State is potentially spending millions of dollars annually on consumers who are being kept unnecessarily in restrictive settings due to the lack of a community placement. As such, this is not only in violation of the Supreme Court Olmstead vs. LC ruling, but result in an extremely inefficient use of precious State dollars. As the budget will undoubtedly become even tighter under current economic conditions, possible ways of improving this inefficiency should be more closely examined.

There are several current studies showing that persons with severe mental illness can live in supportive housing successfully and with positive outcomes. Supportive housing is less expensive than more restrictive settings, and the studies that have been conducted to compare independent settings to group homes have not shown significant differences in outcomes. If anything, independent settings with social services provided onsite seem to result in the most favorable outcomes.

Analysis of the barriers to Expansion Of Supportive Housing

The lack of sufficient supportive housing units continues to occur even though the State DMHS recently funded a number of successful initiatives, including the Rental Subsidy Initiative allocating 452 rental subsidies to provider agencies. Almost all staff interviewed for the purpose of this report claimed to be unable to serve the number of consumers who were in need. Yet, a recent DMHS Request For Information (RFI) did not receive an overwhelming response from agencies requesting additional rental subsidies. There are several possible explanations for this paradox. Agencies identified several areas that prevented them from expanding their supportive housing programs, which are: resistance and stigmatization, administrative and capacity constraints, and funding constraints.

1. Resistance and stigmatization

· Landlords who refuse to rent to consumers

· Families concerned that their loved ones cannot succeed in more independent living

· Consumers fearful of moving on or feeling attached to their current settings

· Staff belief that consumers are not ready

2. Administrative and capacity constraints:

· Difficulty in finding and keeping staff

· Inability to find sufficient rental housing

· Lack of organizational capacity to develop new housing units

3. Funding constraints:

· Actual supportive housing costs are higher than DMHS funding streams

· Client/staff ratios are inconsistent among DMHS contract agencies

· Vouchers are not always tied to service dollars

Benchmarks for funding

Since funding for supportive services was identified as the greatest barrier, three states were examined as a means of understanding how other systems fund supportive housing. According to interviews with staff of agency providers in Connecticut, New York, and Massachusetts, funding for supportive housing varies. Both Massachusetts and New York can bill through the Medicaid Rehabilitation Option for services, and Connecticut allots a predetermined cap per person for services. DMHS allocates funding for services through a ‘negotiation’ process, and billing through the rehabilitation option is not currently available. Agencies can bill for personal care, but this is limited and does not allow agencies to get paid for services related to the strengthening and support of independent living skills.

Part Two:

Developing a Solution – Choosing a Strategy

Criteria

Maintain or reduce costs to the state; Increase access to supportive housing; become feasible for SHA to advocate or implement; and be politically feasible for the State to implement; Reduce the time consumers have to spend in more restrictive settings

recommendations

The following alternatives, in combination, were thought to achieve the greatest results with regard to the aforementioned criteria:

· Advocate for increased rental subsidy funding with availability of support service dollars

· Advocate for administrative improvements to the DMHS Subsidy Program

· Advocate for Medicaid Rehabilitation Option in the State plan

· Advocate for a landlord incentive program

· Promote Collaboration of CDCs and low-income housing developers

Issues for Further Study

· The status of supportive housing in New Jersey for persons with developmental disabilities

· The status of supportive housing in New Jersey for persons who are chronically homeless

· The impacts and effects of using a continuum of care system

SHA

The Supportive Housing Association of New Jersey

THE STATUS OF SUPPORTIVE HOUSING IN NEW JERSEY

FOR PERSONS WITH MENTAL ILLNESS

SOLUTIONS FOR EXPANSION

PRODUCED BY: WENDY TRULL

Introduction

The Supportive Housing Association (SHA) of New Jersey works alongside provider agencies to build their capacity. SHA has seen the number of supportive housing units in the State of New Jersey grow from only a handful prior to its inception in 1997 to over 1400 units in the current year. As the result of this growth there are a number of significant challenges that face both the new Jersey Division of Mental Health Services (DMHS) and housing providers in keeping up with the ongoing administration of supportive housing initiatives.

While no formal studies have been conducted in New Jersey to measure the relative effectiveness of supportive housing regarding cost and improved quality of life, there is every indication that supportive housing achieves favorable outcomes for a large portion of mental health consumers. National studies support this conclusion, as does a preliminary outcomes review of SHA’s membership agencies conducted for the purposes of this report

SHA should be confident because the existing industry is strong; agencies providing supportive housing have been extremely successful in implementing this model with consistency, despite that there are no regulatory mandates that ensure adherence to the supportive housing philosophy. Conclusively, SHA should aggressively advocate for a broader industry base and for supportive housing to be a more widely used and viable residential option for mental health consumers.

Of course, the challenge of expansion offers no easy solution. Supportive housing has succeeded thus far, because organizations have been extremely savvy and creative in converging funding for bricks and mortar and services. New development of supportive housing units have arisen through a (very) few successful tax credit projects, a handful of McKinney projects, HUD Shelter Plus Care, HUD 811 Supportive Housing, and New Jersey Department of Human Services funding through DMHS. In reviewing a sample of member agency budgets, however, the vast majority of ongoing funding for supportive housing for mental health consumers derives from DMHS. DMHS is also the principal agency that is directly and consistently providing service dollars for supportive services.

From a funding perspective, DMHS is the driving force in supportive housing unit creation and service support for mental health consumers, and, according to SHA’s membership data, the majority of units, (approximately 1/3), are not the result of provider agency housing development activities, but of rental support. Rental support usually is funded through a combination of rent subsidy through HUD Section 8 rental vouchers or the DMHS rental subsidy program initiated in 1998

The program has been very effective and the vast majority of these subsidies have been utilized. Additionally, a number of these subsidies have been ‘recycled’ as recipients receive Section 8 or move on to other residential settings and so far, 15 children have been reunited with their parents.

However, despite the program’s effectiveness, agencies have experienced a range of difficulties in using rental subsidies and in expanding their programs to include more units. Addressing these challenges may further expand and increase the level of accessibility to a greater portion of the mental health population. An ongoing administrative system now must be developed to cope with this new program.

SHA is aware that there are challenges in getting agencies to move consumers into supportive housing more quickly. The State’s willingness to fund a training program for direct care staff to help expedite the process is indicative of the existing proactive collaboration. There is movement in the right direction, but a deeper level of understanding of the complicated and systemic barriers that exist could prove useful in finding more solutions. This report seeks to identify some of the barriers that may explain this impasse in order to provide potential alternatives for pushing the industry forward and for strengthening and expanding the industry base.

Methodology and Outline of the Report

Methodology

Interviews were conducted with administrative staff of ten supportive housing providers, and data was collected from the interviewed agencies as a means of determining basic outcome indicators in order to determine the status of the current industry base. The ten agencies reviewed for the purpose of this report represent approximately one-half of the DMHS supportive housing contract agencies and one-third of SHA’s service provider agencies. An established interview protocol was used in order to identify the barriers and challenges of expansion from the agency’s perspective. Interviews were also conducted with staff from DMHS, Corporation for Supportive Housing Connecticut. Project, and agency staff from three other states in order to compare New Jersey’s strategy for funding supportive housing.

Outline

Part One: Assessing the Status of Supportive Housing provides a brief description of some of the policy issues effecting the supportive housing industry, both internally and externally, and the existing debate regarding the efficacy and necessity of the continuum of care. Next, the results of the review of the provider agencies are discussed, which report favorable outcome indicators. The barriers to expansion that the industry faces are then listed along with a discussion of strategies used to fund supportive housing in other states. This information is used to inform Part Two: Developing a Solution – Choosing a Strategy, the analysis of the alternatives available to SHA, which lead to the final recommendations.

Part One:

Assessing the Status of Supportive Housing For Persons With Mental Illness

Background: policy and Financial environment of supportive housing

policy environment

Based on the Americans with Disabilities Act of 1990, The 1999 Supreme Court Olmstead vs. LC decision ruled that isolating people with disabilities in institutions without medical reason for their confinement was a form of discrimination. This ruling has increased awareness of community-based systems of treatment and the need to shift funding from state hospitals and institutional settings to independent living with supportive services in the community.

Supportive housing has become a nationally recognized model for housing and serving mental health consumers in the community, and it has been an integral solution to the fulfillment of appropriate community-based care. Most importantly, it achieves the ultimate goal of allowing persons with severe mental illnesses to live in the community in the least restrictive setting.

Even prior to this ruling, many states had already begun to decrease funding to state psychiatric hospitals and increase funding for community based care. According to data from 33 states, from 1987 to 1997, community based spending increased from 45% to 63%[1]. The expansion of community-based care in New Jersey has also begun. Over the past ten to twelve years, funding for community care increased from $73.8m to $202.4m, out of a total Division of Mental Health Services (DMHS) budget of $577m.[2] Thus, these expenditures now equal almost 50% of the entire DMHS budget. To its credit, DMHS has included in their mission statement the spirit and intent of the Olmstead ruling.

Further, the Division recognizes the desires and ability for mental health consumers to live independently.

“Consumers want and deserve services closer to their homes. In most cases, community mental health services can provide what consumers and their families need in their own community and, by doing so, often prevent unnecessary hospitalization.” [3]

Though the state has made significant strides in transforming the mental health system by strengthening community programs, there remains significant political pressure to maintain an extensive state hospital system, as evidenced by the State’s commitment to build 300 new beds and to keep 200 beds at Greystone Psychiatric Hospital.

It is not to say that complete eradication of psychiatric hospitals should be a goal of the State. Rather, there exists a strong argument that providing adequate housing and treatment in the community could prevent hospitalizations from occurring in the first place, that hospitals should not be used as a long-term solution to care, and that there may be more appropriate community treatment options for emergency and acute care.

Traditionally, mental health consumers are viewed as requiring a certain amount of continuing support due to the episodic nature of their illness. The actual level of structure that they need vs. what they receive in the continuum of care, however, is widely debated at a national level as well as within SHA's membership. This underlying issue causes some disagreement regarding which consumers should remain in structured treatment settings such as group homes.

Several agency staff interviewed noted that some consumers do not do well in situations where they do not have privacy and are expected to adhere to strict policies, rules, and a daily structure perceived as overbearing. As one SHA agency provider commented, "We do provide constant supervision in the group homes, and we do provide structure, but I am not sure that it is necessarily rehabilitative."

Because it is illegal for psychiatric patients to be discharged from the hospital without placement, the State has funded residential options for those who do not have homes to go back to. In New Jersey, prior to 1999, there were close to 170 units of supportive housing, but there were close to 1200 beds in more restrictive settings such as group homes.[4] This meant that until very recently, the vast majority of mental health consumers in need of housing had few choices of where they could live, and if they did not have a home or family to rely on, they frequently wound up in fairly restrictive settings. Once placed, there were few options to move on to more independent settings.

New Jersey has begun to move away from the linear model with its creation of the Supportive Housing Initiative in 1998. According to DMHS, since the initiative, they now fund 1,141 supportive housing units, either through the rental subsidy program, or through supportive service dollars. Remarkably, the number of supportive housing units has now caught up to the number of group home beds. According to DMHS, only 31 group homes were created since the 1999 supportive housing initiative.

A study that examined the effectiveness of supportive housing verses the linear residential treatment approach in New York City, found that after five years 88% of the supportive housing tenants maintained their housing, as compared to only 47% of the residents in the city's residential treatment program.[5] This study challenges many of the widely held clinical assumptions regarding the need for consumers to 'graduate' from residential programs in order to be deemed 'housing-ready'. The supportive housing program that was the subject of the study, Pathways to Housing, accepts tenants into their program regardless of their diagnosis or whether or not they are using or not using substances. The NY/NY supportive housing initiative, created in 1990, has also successfully maintained in housing over 10,154 individuals with a tenure rate of 72%, 50% of whom were diagnosed with both a severe mental illness and a substance abuse disorder, and 50% of whom were diagnosed with schizophrenia.[6]

There are few if any statistically significant studies that compare the effectiveness of community alternatives to supportive housing. Indeed, according to a review of 33 studies on the relationship between housing, mental health, level of services, and outcomes, there is little that we know conclusively regarding these relationships due to mixed results, problematic research designs, and the difficulty in analyzing the data against a series of factors that are highly variable.

However, one of the strongest indications that can be gleaned from this body of research, however, is that persons with mental illness do better in residential settings with fewer occupants. The sample that produced this finding was limited to “...housing that provided small scale, good-quality, non-institutional environments in a community setting with off-site services available to assist with independent living.”[7] In terms of cost-effectiveness, the results of a study that specifically evaluated the impact of supportive housing showed an overall decrease in hospitalizations, dramatic savings to the state in acute care services, and a decrease in symptoms of depression and schizophrenia.[8]

It should be noted, however, that DMHS initiatives have mainly revolved around census reduction from institutions, not for housing the homeless mentally ill or the under-served in the community. There may be as many as 40,000 consumers living in boarding homes which are generally considered to be substandard and do not provide services. Additionally, estimates put the homeless mentally ill population at 12,000.[9] Thus, the major debates regarding budget allocations generally revolve around how consumers coming out of the hospitals should best be served, and over how quickly residents of group programs can be moved into independent housing. This focus has perhaps led us to ignore the severity of the larger problem that we are not addressing the greater needs of the homeless and the under-served in the larger community—those outside of the ‘continuum of care’.

Financial environment

Funding and Incentives to Expand Supportive Housing in Other States

Connecticut

According to an interview with a staff member from Corporation for Supportive Housing in Connecticut, the effects of deinstitutionalization in this state resulted in a very serious homeless problem due to a general lack of available residential options in the community. As a result, CSH got involved with the state in developing a statewide demonstration program that collaborated with the state and other federal funding sources to create nine supportive housing projects. After these projects were carefully tracked for outcome measures and proved effective, community providers and CSH were successful in pushing legislation through that allotted $9,000 in service dollars for each tenant in supportive housing.[10]

Although this program is fairly unprecedented in terms of funding, it involved an extensive two-year planning program and on-going compromise with the state. Though agencies had to be a part of the planning process and had to apply early on, supportive housing’s success can be attributed to the combination of appropriate funding as well as extensive technical support from CSH in developing their projects.

New York

In New York, the State has committed $40 million for supportive housing over the past three years, and the State and City have collaborated to provide over $130 million to support the NY/NY program, which was established to house formerly homeless or chemically addicted mental health consumers. According to the Director of Housing at the New York State Office of Mental Health, in addition to this funding many agencies link with other case management programs for support services, such as through state funded PACT and ACT teams. New York State also provides the Medicaid rehabilitation option, which providers can bill for.

Funding for Supportive Services can also be obtained through the SRO Supportive Services Program, which is administered through the Department of Homeless Services. A maximum formula grant is used to determine the amount of funding that is available: up to $180 per month, per unit, and the agency must have matching dollars invested in the project. Funds can be used for any supportive housing setting for low-income single adults with special needs.[11]

Massachusetts

In Massachusetts, supportive housing is funded in essentially the same manner as all other types of residential options. Agency providers establish a contract for services with the State and then bill through the Medicaid Rehabilitation option as services are provided. Therefore, ongoing services must be documented and accounted for in order to receive full reimbursement. Though the set contract amount is predetermined, there is some flexibility in terms of allocating resources to certain housing option according to Tony Zipple, Executive Director of a $50,000,000 agency that provides residential treatment programs as well as supportive housing to mental health consumers.

With this system, there is no greater incentive to provide one type of housing over another. If there is a greater need for supportive housing, the funding can be used for this purpose and all services billed can be geared to lead to supportive housing, as opposed to the case in New Jersey where billing can only occur with regards to personal care in most supervised settings. As Zipple put it, “Agencies are essentially carpet baggers. They will go where the money is, though I hate to be cynical. Once you provide funding for supportive housing, you would be surprised how quickly providers find a way to move people on.” [12]

Level of Funding In New Jersey

Based on the variation in funding structure in other States, it is clear that there is a range of options that New Jersey could undertake to alter its current system. Regardless of structure, however, it is doubtful that units will be expanded until more overall funding is available. The level of success that has been achieved in other States must be understood within the context of the funding that was available to achieve the State’s goal. For example, based on funding allocations provided between the years of 1998 and 1999, an estimated $13,000 per unit was provided in NY for housing alone, Connecticut currently provides $9,000 in services alone, whereas NJ provides an average $7,000 for both housing and services per unit.

Waiting Lists for Independent Housing Incur High Costs

Although the Division is philosophically committed to moving patients from hospital settings into the community if they are assessed to be willing and capable, in 1999 there were an estimated 1,868 mental health consumers identified as waiting for independent settings in the community. Approximately 666 had legal status on the Conditional Extension Pending Placement (CEPP) in state hospitals, 565 were identified as living in the community but wished to live in less restrictive settings, and 637 were determined to be homeless. While this data was collected two years ago, it represents a fairly constant estimate that may vary slightly from year to year. [13]

Based on these surveys, the level of need occurs at various points in the system. There are as many homeless people with mental illness seeking independent supportive housing or seeking less restrictive housing in the community as there are persons awaiting discharge from the state and county hospital system. Consequently, there is not one point in the system, but several, from which consumers seek to access independent living situations.

Supportive housing is the least expensive, most effective option

As consumers wait for less restrictive housing options to become available, the costs accrue. Based on a survey of agencies conducted by SHA and on data provided by DMHS hospitalization costs four times as much per day as the average cost of being placed in supportive housing. Group home settings also cost on average over two times as much.

Hospital

Supervised

Supportive Housing

Total

Number Served