There has been a 10% reduction in health funding for homeless people since 2008, according to the Simon Community.
The homelessness charity's Annual Impact report shows that €32.6m was allocated to 6,000 homeless people last year, compared to €36m for 1,400 people in 2008.
They said a lack of appropriate health services is causing "lasting damage".
This year the Simon Community plans to expand from 64 to 125 medical treatment beds but says it won't be easy.
Sam McGuinness from the Dublin Simon Community says proper healthcare is vital to ensure people can be successfully re-homed.
He said: "People have physical health issues, mental health issues - as you would the longer you're homeless or even some of that caused homelessness.
"People have various levels of addiction, so they need help to get back on their feet and they need assurance that that help could be around.
"We priovide treatment services and we also provide mental health services to get people back on their feet, to relive their lives and remake a home."
Mr McGuinness says housing alone won't solve the homeless crisis. He said: "We need to show focus and enthusiasm for doing something about health, because people's health will deteriote the longer they need long term emergency accommodation."
The 2016 figures show that almost 93% of people in the Simon Community's emergency accommodation are now considered to be long-term homeless and their length of stay has grown by a third in a year.
"The lack of appropriate health investment, mental health and addiction services is causing lasting damage to people who are homeless. The wider societal impact of this is untold as we continue to face the worst homeless crisis in the history of our state," he added.
Lord Mayor of Dublin, Mícheál MacDonncha commended the Simon Community for their hard work at the launch in Mansion House. He said: "As the homeless and housing crisis has sadly escalated at a rapid rate, Dublin Simon Community continue to be there at the frontline. Their teams provide life-changing support to people most in need, giving hope during this time of great uncertainty and helping people find their way back to a safe place to call home.”
Some key developments from Dublin Simon Community's annual impact report 2016:
Community by the end of 2016;
counselling services, a 46% increase since 2015;