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1 1 (April 2016)

handle is hein.amenin/aeiaanr0001 and id is 1 raw text is: April 2016 Pay for Performance: A New Solution for Vulnerable Homeless Adults By Kevin C. Corinth An emerging consensus has formed among advocates, nonprofit organizations, and the federal government that we have discovered the best solution for vulnerablehomeessadults-Housing First. The Housing First model targets homeless individuals with mental illness and/or substance abuseproblems; it provides permanent housing and supportive services, but it does not require clients to achieve sobriety or actively engage with services in order to remain in housing. While the Housing First model has rightly been celebrated for increasing housing stability among the most vulnerable, evidence for claims that it reduces homeless populations, saves money, and improves well-being is much weaker. We need a new solution that builds on the success of Housing First in housing the most vulnerable but also pushes progress forward on other outcomes. I propose a pay-for-performance system that unconditionally accepts vulnerable individuals into medium-term or long-term supportive housing, but rather than mandate a specific service model, holds serviceproviders accountable for performance: keeping people out of homelessness, minimizing costs, and improving well-being. Service providers with better performance, after adjusting for the vulnerability of their clients, would receivegreater funding and more clients; providers with worseperformance would receive less funding and fewer clients. Competition over performance could simultaneously drive larger reductions in homelessness and more effectively improve the lives of some of the most vulnerable members of society. Homelessness is a vexing societal challenge. On a single night during the winter in the United States, more than 170,000 people literally sleep on sidewalks and other places not intended for human habitation (US Department of Housing and Urban Development 2015b). Over the course of a year, almost 1.5 million people spend at least one night in a homeless shelter (US Department of Housing and Urban Development 2015a). Homelessness is not simply aspell of bad luck that affects everyone equally; 41 percent of shelter users are African American, and essentially all are poor (US Department of Housing and Urban Development 2015a). The most visible members of the homeless population are thesingle adultswithout children who sleep on thestreetsor in congregate shelters. AMERICAN ENTERPRISE INSTITUTE 1

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