Using Pay for Success to Support Housing Mobility

Published Tuesday, October 6, 2015 | by Dan Rinzler, Philip Tegeler, Mary Cunningham, Craig Pollack

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Families who use housing vouchers to move from areas of concentrated poverty to better-resourced neighborhoods have been shown to experience higher earnings and improved health. Housing mobility programs increase the effectiveness of housing vouchers by providing education and support to voucher holders facing barriers to such “opportunity” moves. This working paper proposes using a Pay for Success financing mechanism to increase investment in housing mobility programs based on the hypothesis that health care savings stemming from a positive mobility outcome—specifically related to diabetes and obesity— are sufficient to pay the entire cost of the mobility program. The authors draw on a unique dataset and use a dose-response model to produce four potential health savings scenarios that vary the expected effect timing (when health actually improves). Even the most conservative scenario generates sufficient projected health care cost savings to pay for the housing mobility program’s costs within a ten-year time frame.

This paper is a follow-up to a blog post authored by Dan Rinzler, Mary Cunningham, and Phil Tegeler, posted on the Pay for Success Learning Hub Blog last year.