The issue of healthcare for the homeless is incredibly complex. On the one hand, the homeless use an incredible amount of health care and relatively minor investments in their health may have significant returns. On the other hand, subsidizing homelessness will inevitably lead to more homelessness.
I believe this problem (of which alcohol is a part) is made worse by two things. By the government mandating that health care be given away to those in need, they subsidize and encourage the very same behavior they are trying to help. This leads to the second aspect: by setting these policies the government makes private charity and civil society weaker and less able to handle these problems.
These two together means that private charities are not in a position to say, “we will give you a place to stay, but you need to stop drinking.” As private charities are less able to be effective, we will see fewer of them, increasing the need for government solutions, further exacerbating the problem.
There are moral arguments to be considered, but I will offer you an economic reason to be concerned with this setup. The government could, hypothetically, choose a very good policy that has very good outcomes for most people, but it could just as easily choose a very bad policy. Because of political pressure, it is more likely that the government will choose a policy that benefits a different group (say Molson breweries), whose incentives may not be in line with the group they are trying to help.
So we have a risk of choosing a bad policy, but we will give bureaucrats the benefit of the doubt. The real issue is that even if they choose a really good policy, it is (1) likely that there should be more than one approach, and (2) important that those involved be able to learn.
Any government approach will be inherently systematic, even when done on the local level. This means it will be harder to experiment, there will be one overarching approach in all areas, and the ability to learn will be constrained by red-tape and the lack of ability to observe the effects of policies not tried.
A private approach will lead to multi-pronged efforts by different religious and secular organizations, each accountable to their donors. There will be less red-tape (although groups are allowed to set up their own internal procedures) and more approaches to observe. Accountability will increase and charities will be more responsive to the world around them. If one group tries giving the homeless free booze, they are able to, but only if they can prove to donors that such a plan is effective.
Of course there is an argument for having one, consistent, well-financed approach (i.e. the government), but we have to recognize the costs involved (i.e. flexibility, accountability, etc.) . Do you think the benefits of a top-down approach outweigh the advantages of a private approach?
(I’m sure you’ll see that this reasoning could be extended to many other problems in and out of healthcare.)