with addiction* receiving general assistance
welfare.^69 A more recent analysis in
Washington State of the return on
investment from an increase in addiction
treatment for disabled adults enrolled in
Medicaid or medical coverage through a
general assistance welfare program between
2006 and 2009 found a savings of $2.07 in
medical and skilled nursing facility expenses
for every dollar spent on treatment† over the
four-year period.^70 A performance audit of the costs and
savings to the Colorado Medicaid Program--
which in 2006, implemented a benefit to
provide outpatient addiction treatment for
services related to tobacco, alcohol and
other drugs for all Medicaid beneficiaries--
found that the program cost $2.4 million
over the course of three years while medical
costs for patients receiving services under
this program declined by approximately $3.5
million.‡ 71
A simulation of potential cost savings in the
justice system demonstrated that treating all
arrestees who are at risk of addiction would
cost $13.7 billion and save more than $46
billion (for every dollar spent on treatment,
more than three dollars in benefits accrue).
Treating all arrestees who are “probably
guiltyӤ and who are at risk of addiction
would result in a reduction in recidivism
rates in the range of 16 to 34 percent,
depending on the modality of treatment
(with long-term residential treatment
yielding the greatest reduction in recidivism,
roughly 27 to 34 percent).^72
- Measured as receiving a clinical diagnosis of
alcohol or other drug dependence or psychosis,
receiving detoxification services or having been
referred for alcohol or other drug assessment by the
state division of alcohol and substance abuse.
† In this study, treatment included outpatient,
residential and opioid maintenance therapy and case
management.
‡ Analysis based on available Medicaid claims data,
not a controlled longitudinal study.
§ As phrased by the authors of the study who state
that an admission of guilt generally is required for
enrollment in court-monitored treatment.
Addiction Involving Nicotine. One study
found that 24.6 percent of adult depressed
smokers who received six sessions of mental
health counseling and up to 10 weeks of nicotine
replacement therapy (NRT) with the patch were
abstinent from smoking after 18 months; the
total cost of treatment (smoking cessation
services plus mental health care) was $9,580 per
life year** gained.^73Following the implementation of Medicaid-
covered pharmaceutical therapy for addiction
involving nicotine, Massachusetts had a 46
percent annual decrease in hospitalizations for
heart attacks and a 49 percent annual decrease in
cases of coronary atherosclerosis.†† 74Addiction Involving Alcohol. For individuals
with addiction involving alcohol, a number of
pharmaceutical interventions have been found to
be cost effective, including medical management
with naltrexone therapy and combined
naltrexone and acamprosate therapy.^75Even among patients who already have
developed an alcohol-related illness (such as
alcohol-related liver damage or psychosis),
treatment may reduce future health care costs.
Naltrexone therapy is related to less of an
increase in health care expenditures for
individuals with alcohol-related illnesses
compared to a control group‡‡ ($63 increase
among naltrexone recipients vs. $814 increase
among controls). Those in the control group
were more likely to have an alcohol-related visit
to the emergency department during the study
compared to patients taking naltrexone (15
percent vs. nine percent).^76Addiction Involving Other Drugs. One study
examined the cost effectiveness of providing** The cost of extending a patient’s life by one year is
a common metric used in cost-effectiveness studies.
†† There were, however, no significant changes in
rates of hospital admissions for respiratory conditions
including pneumonia, asthma, chronic obstructive
pulmonary disease and respiratory failure.
‡‡ Individuals with the same range of alcohol-related
illnesses who were not prescribed naltrexone.