Imagine this. You’ve suffered a debilitating mental illness, you’re admitted to hospital and, after weeks or months of treatment, you’re finally deemed stable enough to go home. Only, you can’t – the home you need in the community is not available.

As a psychiatrist, this is a situation I and many others around the country encounter almost daily. Even when patients are ready to leave hospital, a notable number don’t have the specialist supported housing they need to take that step.

Currently, around 60,000 people in England live in specialist mental health supported accommodation. They are there because of the severity of their condition, their level of vulnerability and their complex needs, which often include requiring support for everyday activities. Supported housing offers them the freedom to live as independently as possible, while also reducing their use of hospital beds, both in the mental health sector and in the acute, physical health sector.

With the right support from housing care staff alongside secondary mental health care rehabilitation and recovery services, many can and do achieve stability. Along with this, the opportunities to re-engage with family, education, work and their community are more within reach.

Without such provision, many people become stuck in highly restrictive, costly and more institutionalised care, such as hospital wards and care homes. These are often at great distances from their families and communities and require even more public funding. Supported housing provides that crucial interim step for those who need it, between hospital or residential care home, to people moving into their own flats with support coming in. This also often means the difference between living and staying well in the community, to becoming unwell again and requiring yet another hospital admission.

Providers of supported housing for vulnerable people, including those with mental health conditions, have clearly communicated that the government’s proposed changes to how supported housing is funded will result in the closure of such services. Yet there does not appear to be a viable alternative for those most in need. Providers of supported housing have already been closing accommodation across England and halting the development of new, much needed provision.

The effects are already being seen on acute psychiatric wards, with increasing levels of delayed discharges, resulting in fewer available beds for those requiring acute emergency admission and an increasing number of people being sent hundreds of miles from home.

It has also been found that those who are sent far away for treatment are more likely to take their own lives upon returning home than those who are admitted to hospitals close to them.

The adequate provision of supported housing locally is crucial for many national policies and strategies to be realised. These include the five year forward view for mental health, the Crisp commission on acute adult psychiatric care and transforming care for people with learning disabilities, which all state the central importance of specialist supported housing to aid people’s recovery and to enable successful community living.

The health and social care system is made up of so many parts. The lack of a joined-up policy results in unintended consequences for patients, their families, services, commissioners who pay for care and society as a whole.

Money can be spent more efficiently when people are in the right setting for their level of need. For this to work, a system-wide approach across health and social care with adequate resources at each level, including supported housing, is vital. Especially for those whose lives depend on it.

If health regulators would fund a more joined-up way of working, then every person could receive the right care and support, in the right place, at the right time.

Dr Sri Kalidindi is head of the rehabilitation & social psychiatry faculty at the Royal College of Psychiatrists