Not sure why the article touts this as a new idea, unless the details are missed in its brevity. HUD provides funds to most cities to do this very thing already, though they may cater more toward families than to to chronically homeless individuals, which is a whole weird definition in itself http://ochmis.org/documents/Chronically%20Homeless%20Flowcha...
Most people will recognize it as section 8, which has negative connotations.
HUD-VASH http://portal.hud.gov/hudportal/HUD?src=/program_offices/pub... provides the same thing for homeless veterans, case management included.
It's easy to make the statistics look good when you narrow your definition of homeless to a small group and can afford to give them all housing. My experience with individuals who are classified as chronically homeless is that there is only a small chance of rehabilitating them into a "successful" member of society.
edit: links are messing up, adding a close parenthesis to the end...