State health policy making is rarely based on evidence derived from empirical analysis. An exception is an innovative policy established in 2005 in Washington State (Senate Bill [SB] 5763) to provide funding (approximately $30 million) to expand access to substance abuse (SA) treatment for Medicaid beneficiaries. The authors analyzed Medicaid claims data and other administrative data over a 7-year period, July 2001 through June 2008, for three cohorts of welfare clients (n ≈ 44,000) to assess the effect of SA treatment on health care expenditures. Regression analysis showed SA treatment to be associated (p < .001) with per member per month expenditure savings of approximately $160 to $385 depending on the welfare cohort. The aggregate annualized estimated saving ($16.8 million) equaled the cost-saving goal of SB 5763. While it may be tempting for policy makers to cut funding for SA treatment, this may be counterproductive and in the long-run increase Medicaid costs.
BrewerR. D.MorrisP. D.ColeT. B.WatkinsS.PatettaM. J.PopkinC. (1994). The risk of dying in alcohol-related automobile crashes among habitual drunk drivers. New England Journal of Medicine, 351, 513-517.
2.
CartwrightW. S. (2000). Cost-benefit analysis of drug treatment services: Review of the literature. Journal of Mental Health Policy and Economics, 3(1), 11-26.
3.
CartwrightW. S. (2008). Economic costs of drug abuse: Financial, cost of illness, and services. Journal of Substance Abuse Treatment, 34, 224-233.
4.
CawthornL.SchragerJ. L. (1995). Substance abuse, treatment, and birth outcomes for pregnant and postpartum women in Washington State. Olympia, WA: Department of Social and Health Services, Planning, Research and Development, Office of Research and Data Analysis, First Steps Database.
5.
CorraoG.BagnardiV.ZambonA.La VecchiaC. (2004). A meta-analysis of alcohol consumption and the risk of 15 diseases. Preventive Medicine, 38, 613-619.
6.
DollR.PetoR.HallE.WheatleyK.GrayR. (1994). Mortality in relation to consumption of alcohol: 13 years’ observations on male British doctors. British Medical Journal, 309, 911-918.
7.
DunnK. M.SaundersK. W.RutterC. M.Banta-GreenC. J.MerrillJ. O.SullivanM. D.. . . Von KorffM. (2010). Opioid prescriptions for chronic pain and overdose: A cohort study. Annals of Internal Medicine, 152, 85-92.
8.
EdwardsG.OrfordJ.EgertS.GuthrieS.HawkerA.HensmanC.. . . TaylorC. (1977). Alcoholism: A controlled trial of “treatment” and “advice”. Journal on Studies of Alcohol, 38, 1004-1031.
9.
EsteeS.NordlundD. J. (2001). Washington State Supplemental Security Income (SSI) cost offset pilot project (2001 Progress Report, Report No. 11.101). Olympia, WA: Research and Data Analysis Division, Department of Social and Health Services.
10.
EsteeS.NordlundD. J. (2003). Washington State Supplemental Security Income (SSI) cost offset pilot project (2002 Progress Report, Report No. 11.109). Olympia, WA: Research and Data Analysis Division, Department of Social and Health Services.
11.
FranklinG. M.StoverB. D.TurnerJ. A.Fulton-KehoeD.WickizerT. M. (2008). Early opioid prescription and subsequent disability among workers with back injuries: The Disability Risk Identification Cohort. Spine, 33, 199-204.
12.
GilmerT.KronickR.FishmanP.GaniatsT. G. (2001). The Medicaid Rx model: Pharmacy-based risk adjustment for public programs. Medical Care, 39, 1188-1202.
13.
GoodmanA. C.TilfordJ. M.HankinJ. R.HolderH. D.NishiuraE. (2000). Alcoholism treatment offset effects: An insurance perspective. Medical Care Research and Review, 57, 51-75.
14.
HartC. L.SmithG. D. (2008). Alcohol consumption and mortality and hospital admissions in men from the Midspan Collaborative Cohort Study. Addiction, 103, 1979-1986.
15.
HayamiD. E.FreebornD. K. (1981). Effect of coverage on use of an HMO alcoholism treatment program, outcome, and medical care utilization. American Journal of Public Health, 71, 1133-1143.
16.
HolderH. D. (1987). Alcoholism treatment and potential health care cost saving. Medical Care,25, 52-71.
17.
HolderH. D. (1998). Cost benefits of substance abuse treatment: An overview of results from alcohol and drug abuse. Journal of Mental Health Policy and Economics, 1(1), 23-29.
18.
HolderH. D.BloseJ. O. (1986). Alcoholism treatment and total health care utilization and costs. A four-year longitudinal analysis of federal employees. Journal of the American Medical Association, 256, 1456-1460.
19.
HolderH. D.BloseJ. O. (1992). The reduction of health care costs associated with alcoholism treatment: A 14-year longitudinal study. Journal of Studies on Alcohol, 53, 293-302.
20.
HolderH. D.HallanJ. B. (1986). Impact of alcoholism treatment on total health care costs: A six-year study. Advances in Alcohol & Substance Abuse, 6(1), 1-15.
21.
JewellC.BeroL. (2008). Developing good taste in evidence: Facilitators of and hindrances to evidence-informed policymaking in state government. Milbank Quarterly, 86, 177-208.
22.
KaneR. L.WallM.PotthoffS. P.StrombergK.DaiY.MeyerZ. J. (2004). The effect of alcoholism treatment on medical care use. Medical Care Online, 42, 395-402.
23.
KronickR.GilmerT.DreyfusT.LeeL. (2000). Improving health-based payment for Medicaid beneficiaries: CDPS. Health Care Financing Review, 21(3), 29-64.
24.
LongabaughR.McCradyB.FinkE.StoutR.McAuleyT.DoyleC.McNeillD. (1983). Cost effectiveness of alcoholism treatment in partial vs inpatient settings. Six-month outcomes. Journal of Studies on Alcohol, 44, 1049-1071.
25.
LuncenkoB.MancusoD.EsteeS. (2008). Co-occurring disorders among DSHS clients: A report to the legislature (Report No. 3.32). Olympia, WA: Research and Data Analysis Division, Department of Social and Health Services.
26.
LumleyT.DiehrP.EmersonS.ChenL. (2002, October). The importance of the normality assumption in large public health data sets. Annual Review of Public Health, 23, 51-69.
27.
MancusoD.FelverB. E. M. (2010). Bending the health care cost curve by expanding alcohol/drug treatment. Unpublished report. Research and Data Analysis Division, Department of Social and Health Services, Olympia, WA.
28.
MancusoD.GilsonM.FelverB. (2005). The 2003 Washington State Needs Assessment Household Survey. Olympia, WA: Research and Data Analysis Division, Department of Social and Health Services.
29.
McCollisterK. E.FrenchM. T. (2003). The relative contribution of outcome domains in the total economic benefit of addiction interventions: A review of first findings. Addiction, 98, 1647-1659.
30.
MokdadA. H.MarksJ. S.StroupD. F.GerberdingJ. L. (2004). Actual causes of death in the United States, 2000. Journal of the American Medical Association, 291, 1238-1245.
31.
MurrayM.HoggR. S.LimaV. D.MayM. T.MooreD. M.AbgrailS.. . . SterneJ. A. (2011). The effect of injecting drug use history on disease progression and death among HIV-positive individuals initiating combination antiretroviral therapy: Collaborative cohort analysis. HIV Medicine, 13(2), 89-97.
32.
National Institute on Drug Abuse and National Institute on Alcohol Abuse and Alcoholism. (1998). The economic costs of drug abuse in the United States—1992. Washington, DC: Government Printing Office.
33.
NordahlT. E.SaloR.LeamonM. (2003). Neuropsychological effects of chronic methamphetamine use on neurotransmitters and cognition: A review. Journal of Neuropsychiatry and Clinical Neuroscience, 15, 317-325.
34.
ParthasarathyS.WeisnerC.HuT. W.MooreC. (2001). Association of outpatient alcohol and drug treatment with health care utilization and cost: Revisiting the offset hypothesis. Journal on Studies of Alcohol, 62(1), 89-97.
35.
ReynoldsK.LewisL. B.NolenJ. D. L.KinneyG. L.SathyaB.HeJ. (2003). Alcohol consumption and risk of stroke: A meta-analysis. Journal of the American Medical Association, 289, 579-588.
36.
RyanR.RinaldiL.McGeeS.KabelJ.WilliamsC. (2007). Arrestee Estimates of Substance Abuse Treatment Need (ARREST) Study (Report No. 4-22). Olympia, WA: Washington State Department of Social and Health Services.
37.
SearsJ.KrupskiA.JoeschJ. M.EsteeS. L.HeL.ShahM. F.. . . Roy-ByrneP. P. (2010). The use of administrative data as a substitute for individual screening scores in observational studies related to problematic alcohol or drug use. Drug and Alcohol Dependence, 111(1-2), 89-96.
38.
Substance Abuse and Mental Health Services Administration. (2010). Results from the 2009 National Survey on Drug Use and Health: Volume 1. Summary of national findings (NSDUH Series H-38A, HHS Publication No. SMA 10-4856). Rockville, MD: Office of Applied Studies.
39.
ThunM. J.PetoR.LopezA. D.MonacoJ. H.HenleyJ.HeathC. W.DollR. (1997). Alcohol consumption and mortality among middle-aged and elderly US adults. New England Journal of Medicine, 337, 1705-1714.
40.
WickizerT. (2007). The economic costs of drug and alcohol abuse in Washington State, 2005. Olympia, WA: Washington State Department of Social and Health Services, Division of Alcohol and Substance Abuse.
41.
WickizerT. M.KrupskiA.StarkK. D.MancusoD.CampbellK. (2006). The effect of substance abuse treatment on Medicaid expenditures among general assistance welfare clients in Washington State. Milbank Quarterly, 84, 555-576.
42.
WrightD.SatheN. (2006). State estimates of substance use from the 2003-2004 national surveys on drug use and health (DHHS Pub. No. SMA 06-4142, NSDUH Series H-29). Rockville, MD: Substance Abuse and Mental Health Services Administration, Office of Applied Statistics.
