Here's a small article about this cemetery at a site devoted to the history of Poorhouses, "tax-supported residential institutions to which people were required to go if they could not support themselves."
They were started as a method of providing a less expensive (to the taxpayers) alternative to what we would now days call "welfare" - what was called "outdoor relief" in those days. People requested help from the community Overseer of the Poor ( sometimes also called a Poor Master) - an elected town official. If the need was great or likely to be long-term, they were sent to the poorhouse instead of being given relief while they continued to live independently. Sometimes they were sent there even if they had not requested help from the Overseer of the Poor. That was usually done when they were found guilty of begging in public, etc.