When Kaiser Permanente last month announced it would commit $200 million to address homelessness in areas it serves, the huge health care provider served notice that the private sector is recognizing that housing insecurity is both a pressing health problem and a significant drag on economic growth in key parts of the country.
The money is a start, and it is expected to produce a return that will allow more so-called “impact investments” in years to come. More significant, perhaps, is the expression of concern that Kaiser has shown. Serving 12 million members, and with $65 billion in annual revenues, the California-based nonprofit is a major presence from coast to coast. Its network of Kaiser Foundation hospitals and other health services operate in California, Washington, Oregon, Hawaii, Colorado, Georgia, Maryland, Virginia and the District of Columbia.
Kaiser’s example may encourage other companies to join in the quest to provide more housing for low-income people, a movement that’s gaining traction in a new program called Mayors and CEOs for U.S. Housing Investment.
Assessing the Problem
The dimensions of the homelessness problem are outlined in a fact sheet on the Mayors/CEO website. More than half a million people experienced homelessness on any given night in 2017, it reports. About 1.5 million people used homelessness services, including emergency shelters, in 2016.
The fact sheet observes that the most common contributing factor is people’s inability to find housing they can afford. “Today 11 million extremely low-income households pay at least 50% of their income toward housing,” it says, “putting them at great risk of instability and homelessness. Confounding factors …include chronic health problems, domestic violence and systemic inequality.”
Impact investing has grown in recent years, as investors seeking to improve the world have looked to generate a measurable, beneficial social or environmental impact alongside a financial return. Kaiser’s program recognizes that housing is important to people’s well-being and health, as Bechara Choucair, Kaiser Permanente’s chief community health officer said as the company’s program was unveiled on May 18.
“Many of the communities we serve are grappling with some of the highest rates of housing insecurity and homelessness in the United States,” Choucair said. “As a family physician, I’ve provided medical care to the homeless, and have seen first-hand the impact that living without a home can have on someone’s health. To improve the health of an entire community we must step beyond the four walls of our hospitals and medical offices to help those most in need. We hope this national commitment to impact investing in housing stability will inspire other companies to share the responsibility of this critical issue growing in the United States.”
Because impact investing does require a decent financial return, it is unlikely that the projects Kaiser backs will offer direct homelessness services, such as temporary shelters. Kaiser, of course, will not be the sole investor in the housing projects, which necessarily will rely on other sources of capital as well. Kaiser has other programs ranging beyond housing to address the health needs of the very poor.