Addiction Treatment and Disease Management ........................................................
Persons with untreated addiction have higher
health care utilization rates and more frequent
hospital stays, generating billions of dollars
in largely avoidable health care charges.^61
Addiction treatment, particularly evidence-based
treatment, not only reduces health care costs in
both the short and long term, it saves lives and
reduces other social consequences and costs as
well.* 62 Some research suggests that treatment
“pays for itself,” often on the day it is delivered
and the total cost savings from addiction
treatment continue to accrue over time.^63
While the total economic benefits of treatment
are greater than the cost of treatment,^64
administrators and policymakers too often
disregard benefits of treatment that accrue
beyond the narrow silo of each individual
government program. For example, health care
payers may refuse to acknowledge the
significant cost savings that may accrue outside
the health care system (increased productivity,
reduced crime, etc.). An example of this can be
seen in an analysis of data from the VA health
care system from 1998 to 2006 showing that
providing addiction treatment resulted in an
overall increase in health care costs, presumably
because expanding access to treatment brought
more sick patients into the health care system
and more of their co-occurring medical
conditions subsequently were identified and
treated. The one exception was opioid
maintenance therapy which paid for itself in
health care savings. This study did not account
for potential longer-term reductions in health
care costs or for potential cost savings in other
sectors because it was taking the perspective of
an insurance payer--via the VA health care
system^65 --and this perspective tends to look at
short-term costs rather than long-term savings.
Most studies--even those that look only within a
particular system for costs and benefits--find
immediate and longer-term savings associated
with addiction treatment:
- The referenced studies do not include detailed
examples of the nature of the treatment provided.
A longitudinal study of patients treated for
addiction in Kaiser Permanente’s Medical
Care Program found an average reduction of
30 percent in medical costs three years post-
treatment. Significant declines were seen in
areas such as the number of inpatient
hospital days and emergency department
visits, which are high-cost services.^66 A comparison of adult patients who met
clinical criteria for addiction involving
alcohol or drugs other than nicotine who
were enrolled in an outpatient treatment
program with a control group† found that
those enrolled in the treatment program were
less likely to be hospitalized 18 months after
treatment than before treatment. The study
also found that treatment can cut health care
costs associated with addiction by about one
quarter, primarily by reducing the number of
annual hospital stays and the likelihood of
emergency room visits.^67 An analysis of data from patients in
treatment for addiction involving alcohol or
drugs other than nicotine in California found
a benefit-cost ratio of more than seven to
one:‡ the average cost of treatment was
$1,583 and the benefits§ were $11,487.
Most of the savings were attributed to
reduced crime and increased employment.^68 An analysis of statewide data from
Washington State found that treatment was
associated with an annual $2,500 reduction
in medical expenses** among adult patients† Adults who met criteria for addiction involving
alcohol or other drugs but did not receive treatment.
‡ Nine months after treatment.
§ Including earnings from employment and reductions
in the costs related to emergency department visits,
incarceration and crime.
** Including inpatient and outpatient hospital care,
physicians’ services, prescription drugs and nursing
home care. Most of the reductions in medical
spending were within Medicaid expenditures.