Cost and Usage Impacts of Treatment Initiation: A Comparison of Alcoholism and Drug Abuse Treatments

An extensive literature on substance abuse and mental health treatments suggests that they often lead to decreased usage and/or spending on other medical treatments. We compare alcohol and drug abuse treatment costs with a model that decomposes total treatment costs into amount of treatment (outpatient visits or inpatient days) and costs per treatment. The analysis compares alcohol and drug abuse treatment costs regarding: (1) the incremental costs attributable to changed short‐term substance abuse and nonsubstance abuse treatments; (2) the impacts of current substance abuse treatments on short‐term nonsubstance abuse, long‐term substance abuse, and long‐term nonsubstance abuse treatments; and (3) the difference in inpatient and outpatient impacts. Our findings indicate that alcoholism and drug abuse treatment initiation have similar impacts on coincident and subsequent utilization and costs. For both treatments, the largest portions of the cost impacts occur for inpatient treatments, and for treatments that occur within 6 months of the initiation. The similarity of results suggests that it may often be reasonable to infer utilization and cost impacts for one type of care from studies that examine the other.