After the Healey administration put the brakes on a rental voucher program for residents with serious mental illnesses, human services providers are seeking a funding infusion to preserve the housing assistance that they say will save the state money in the long run.
As fiscal year 2027 budget deliberations unfold, an additional several million dollars could be headed toward the Department of Mental Health’s Rental Subsidy Program, which covers the majority of monthly housing costs for clients with limited incomes.
The vouchers help ensure stable housing for DMH clients, who have shown enough improvement that they’ve transitioned out of more intensive and costlier care settings like hospitals and group homes, said Jean Yang, CEO of provider organization Vinfen. With the vouchers, clients end up paying 30% of their monthly incomes on rent costs for market-rate units and continue to receive behavioral health support.
“These people are more independent, so instead of 24/7 watch, we just see them typically once a week to make sure that their meds are on, their job is going OK, and people are doing well,” Yang said. “These are sort of the success cases of DMH intervention.”
Spending on DMH rental subsidies has grown by about 22% between fiscal 2020 and 2026 due to heightened demand and rental costs, according to a spokesperson for the Executive Office of Health and Human Services.
But confronting limited financial resources compounded by rising rental prices, DMH last July paused the leasing of any new rental subsidy program units, according to a memo from then-Acting Commissioner Beth Lucas. When existing clients leave their apartments, providers are not allowed to “backfill” the units with new occupants, according to the October 2025 memo shared with the News Service.
The Massachusetts Association for Mental Health says DMH is effectively “seeking to shrink the program through attrition by not accepting any new clients.” The program supported more than 2,600 people in fiscal 2026, and 120 vouchers were lost through “attrition,” according to the association.
Yang estimates 400 units could be lost in fiscal 2027, based on Gov. Maura Healey’s funding recommendation of about $16.5 million for one of the program’s line items. Another $7 million is needed to preserve the scale of the voucher program, Yang and the association say.
The House budget contains $20 million, after the branch did not adopt a Rep. Sean Garballey amendment that would have added $3.5 million to the voucher program. The Senate Ways and Means Committee budget matches Healey’s funding level. A Sen. Jamie Eldridge amendment that will be settled next week would inject the extra $7 million that advocates have requested.
“For those that are DMH clients, you want to particularly make sure that they’re in safe and secure housing, ideally that’s close to perhaps the mental health or professional care they’re getting,” Eldridge said. “Because that’s going to create a level of stability that, my goodness if someone is homeless or is worried about paying their rent at the end of each month, (that) could really lead to a severe mental health crisis.”
People with mental illnesses “don’t disappear,” Yang said, if the program is scaled back or stretched too thin.
“They are going to be found in hospitals, emergency rooms often, jail cells, homeless shelters or group homes because we can’t discharge them down anymore,” Yang said. “So you’re replacing this with more restrictive and more costly options, and then you just back the whole thing up so that people cannot have access to the system when they need it.”
DMH spent an average of $750 per monthly voucher in fiscal 2021, compared to $1,300 in fiscal 2026. Yang estimates a group home could cost up to $9,000 per month and a hospital stay could be upwards of $20,000, Yang estimates.
The EOHHS spokesperson did not answer News Service questions about where DMH clients live if they cannot access rental vouchers, and whether the administration has any plans to lift the lease freeze.
Alison Kuznitz is a reporter for State House News Service and State Affairs Pro Massachusetts. Reach her at akuznitz@stateaffairs.com.
