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Societal Outcomes and Cost Savings from AOD Treatment

— Jeffrey N. Kushner, Drug Court Administrator for the 22nd Judicial Circuit, St. Louis, Missouri, and former Director, Office of Alcohol and Drug Abuse Programs, Oregon Department of Human Resources.

Most State legislatures are not convinced about the "goodness" of alcohol and other drug (AOD) treatment by reviewing either national research data or studies completed in other States. State legislatures want data from the State treatment system they are funding. This can be a problem from several standpoints, not the least of which is the onerous cost of follow-up studies that depend on personal interviews. And how accurate are they, really?

Over the past 30 years, there have been a number of studies involving economic analyses of the benefits and costs of drug and/or alcohol treatment.¹ The usefulness of their results has often been weakened by limitations in their methodologies. These study limitations include the following:

Lack of a comparison or control group

Failure to use a representative sampling design in selecting subjects

Exclusive use of self-reported data

Brief observation periods (usually focused on the time just before or just after treatment — not necessarily representative periods)

Use of limited populations (for example, enrollees in an HMO)

Assessment of costs and benefits only in a limited number of areas

Oregon's Study Approach

Oregon decided to take a different approach. A study that would use Oregon-specific outcome data was chosen as a result of interest from the Governor's Council on Alcohol and Drug Abuse Programs and a nudge from the Oregon Legislative Assembly. The total cost of this study was approximately $30,000. No specific funding was provided.

The Oregon study was designed to overcome some of the methodological limitations of prior studies that have looked at benefits and costs of drug and/or alcohol treatment. Its study design has the following characteristics:

We selected a representative sample of clients who had completed treatment and matched them with a comparison group of clients who received little or no treatment.

We used existing State agency databases rather than self-report data; these databases provided for maximum objectivity.

We utilized an adequate study period, which covered 2 years prior to treatment and 3 years subsequent to the completion of treatment.

Study Design

Using a quasi-experimental design, groups of clients who had completed treatment were compared with groups of clients who had enrolled in treatment programs but terminated after receiving only minimal services. In order to have up to 3 years of post-treatment outcome data, the sample was drawn from fiscal year 1991-92.

Using the Client Process Monitoring System (CPMS) database, a representative random sample of clients was selected for each service element — outpatient, residential, and methadone. The CPMS database is the Oregon management information system for alcohol and/or drug treatment programs that receive public funds (built off the old CODAP system). Programs must report on clients at intake and at termination.

A comparison group was randomly selected. This group was made up of clients who began treatment but did not follow through in keeping appointments. The comparison group was matched to the treatment completers, so that no differences existed between the groups in age, gender, race, drug type, or severity of drug abuse. Based on a power analysis of the needed sample size, we set a target of 250 treatment and 250 comparison clients for each module, outpatient and residential. A total of 1,267 clients was originally selected for the study sample.

Use of Existing Databases

To collect outcome data for these clients from the periods prior and subsequent to their treatment episodes, we used existing State databases. We gained permission to access these databases and protected the confidentiality of clients at all times. These State databases included the following:

Client Process Monitoring System

Law Enforcement Data System

Offender Profile System

Adult and Family Services

Office of Medical Assistance Programs (Medicaid)

Children's Services Division

Outcome Study Results

Oregon's study found extensive cost savings on a variety of dimensions for clients who had successfully completed their AOD treatment. Significant cost savings occurred because of the reductions in arrests and convictions, incarceration, use of welfare benefits, open child welfare cases, emergency room medical costs, and because of an improvement in clients' earning power and number of days worked. For every dollar spent on treatment, taxpayers saved $5.60 in avoided costs.

Even this figure is most conservative for the following reasons:

The study includes no cost savings from the clients' decrease in unemployment.

Some benefit can be assumed to accrue for those comparison-group clients who were treated for weeks and/or months but did not complete treatment. These savings are not represented in this study.

Other potential cost avoidances are not included. For example, savings were realized because many clients avoided problems that would otherwise have exacted public and private funds, such as Federal and local prison costs, institutional costs, damage caused by intoxicated drivers, business losses, and the birth of healthy rather than drug-affected babies.

Copies of the study Societal Outcomes and Cost Savings of Drug and Alcohol Treatment in the State of Oregon are available from the Oregon Office of Alcohol and Drug Abuse Programs. To order, call Clint Goff, at (503) 945-5763.

Results of Oregon's State-Specific Outcome Study

AOD treatment completers had significantly fewer arrests and convictions in the 3 years after treatment than early leavers, even though there were no statistically significant differences in their arrest and conviction histories prior to treatment. Clients who completed outpatient treatment were arrested at a rate 45 percent lower than the matched group.
Treatment completion is associated with substantially fewer incarcerations in State prison and with shorter incarcerations. Clients who completed residential treatment were jailed at a 70 percent lower rate than the matched group.
Treatment completers earned 65 percent more than noncompleters, due to higher wages and increased time at work.
Clients who completed treatment reduced their use of food stamps by one third in contrast to the comparison group.
For clients who completed treatment, the number of open child welfare cases decreased by 50 percent.
Medical expenses dropped substantially for treatment completers compared with the control group. Early leavers dramatically increased their use of hospital emergency rooms.
Savings of $83,147,187 in avoided criminal justice, medical, and public assistance costs, and in victim and theft losses were realized for the 1991_92 cohort of treatment completers in the 2½ years following treatment. The cost for AOD treatment for all adults in 1991_92 was $14,879,128.
Overall, significant positive societal outcomes resulting from AOD treatment accrued and lasted for at least 3 years.

¹For a thorough examination of all but the most recent research, the reader is referred to: President's Commission on Model State Drug Laws, Socioeconomic Evaluations of Addictions Treatment, by the Center of Alcohol Studies at Rutgers University. The White House: Washington, DC, 1993.

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