Drug Treatment - Is Treatment Worth The Money?

A study conducted by the RAND corporation in 1994 concluded that treatment was the most effective program available for reducing cocaine consumption (Peter Rydell and Susan Everingham, Controlling Cocaine: Supply Versus Demand Programs (Santa Monica, CA: RAND, 1994, http://www.rand.org/publications/MR/MR331/). The authors studied various drug-control strategies—treatment, domestic enforcement, interdiction, and source country control—and concluded that to achieve a 1% reduction in cocaine consumption in the United States, the country would have to spend either $34 million on treatment, $250 million on domestic enforcement, almost $400 million on interdiction, or around $800 million for source control. Their conclusion was that domestic enforcement was 7.3 times more costly than drug treatment.

The study was criticized on methodological grounds by the National Research Council, to which RAND also responded. The conclusions were controversial, and federal policy makers clearly did not accept the study's findings because budgets have not come to reflect the study's priorities. None of the programs is fully effective, and approaches based entirely on cost effectiveness tend to leave out crucial elements. Treatment, law enforcement, border control, and eradication efforts all continue to have strong proponents.

The issue of cost effectiveness is more frequently discussed by comparing the costs of treatment to the costs of imprisoning drug offenders.

Treatment versus Incarceration

For example, in a somewhat dated analysis (National Treatment Improvement Evaluation Study (NTIES), SAMHSA, 1997), SAMHSA's analysts observed that "treatment appears to be cost-effective, particularly when compared to incarceration, which is often the alternative." The study did not examine the cost of incarceration but referred to a study by the American Correctional Association, which gave the estimated 1994 cost of incarceration as $18,330 per prisoner annually. The most expensive treatment in 1997, according to NTIES, was $6,800 per client for long-term residential programs—just over one-third the cost of a year of incarceration.

If treatment only works in 21.4% of all cases, as shown by SAMHSA data discussed above, results seem to favor incarceration if the object is to remove one person from the drug-using population for some fixed period of time—a year, for example. With treatment working in only 21.4% of cases, nearly five people (4.7) have to be treated to achieve one favorable result. But the analysis would be incomplete. Incarcerating individuals removes them from the drug-using community but does not cure them. Furthermore, many incarcerated individuals must undergo drug treatment while in prison, requiring additional expenditures. Simple answers are not available, one reason why multiple approaches to managing the drug problem survive side by side.

THE ARIZONA EXPERIENCE.

In 1996 the voters of Arizona passed Proposition 200, called Drug Medicalization, Prevention and Control Act of 1996. Under this law, first- and second-time drug offenders not charged with a violent crime are sent to treatment rather than undergoing incarceration. The Arizona Supreme Court conducted a study of the first year of probation with mandatory drug treatment, released in 1999. It estimated that the state's new program saved more than $2.5 million and was likely to show even greater savings in the future. The court estimated the cost of treatment, counseling, and probation at $16.06 a day, compared with $50 a day to keep an inmate in prison (Barbara Broderick, Arizona's director of adult probation, "The Arizona Experience: Probation with Treatment Protects the Community," testimony before the Subcommittee on Criminal Justice, Drug Policy and Human Resources, U.S. House of Representatives, July 1999).

The Arizona program, according to the testimony cited above, is largely paid for by a tax on alcohol. Daily financial savings are not the only benefit of treatment versus incarceration, however. Most addicts, untreated, emerge from prison and quickly return to drug use, often committing crimes to get money for the drugs. Of the 2,622 people treated by the program, 77.5% subsequently tested free of drugs. Arizona drug users on probation are expected to help pay for their treatment; 77.1% made at least one payment. The program, however, does not apply to chronic drug offenders or those who commit violent crimes. It is a partial application of treatment instead of incarceration.

Other Measures of Cost-Effectiveness

DRUG TREATMENT FOR EMPLOYEES.

In 1998 John Saylor, manager of Employee Assistance Programs for AMR Corporation (which includes American Airlines), testified before the Senate Committee on Labor and Human Resources about the value of treatment for alcohol and drug addiction for AMR and its employees. Saylor was "charged with the task of ensuring that any AMR-insured person will receive the best available treatment for his/her alcoholism or drug addiction, with no limit on days or sessions, and no limit on dollars other than the lifetime maximum for all medical care (currently at $1,000,000)." He was confident that this corporate investment turned out to be both prudent and highly successful.

Saylor reported that follow-up studies of employees who received alcohol or drug treatment showed that 75-80% remained completely drug and alcohol free during their year of monitoring. He estimated that the average cost to AMR for complete treatment has been between $5,000 and $6,000 per person. With other serious life-threatening diseases, the first day of treatment alone can cost that much, according to Saylor. He is convinced that the expenditure of this "moderate amount of money" reduced accidents, injuries, and diseases.

DRUG TREATMENT FOR WELFARE RECIPIENTS.

According to the National Conference of State Legislatures, federal studies estimate that up to 35% of the welfare population is addicted to drugs or alcohol. Welfare recipients who cannot get or keep a job are dropped from the welfare rolls. Therefore, those on the rolls who have substance-abuse problems jeopardize a state's ability to meet strict federal work participation requirements, which could result in financial penalties.

As a result, many states are using a portion of their Temporary Assistance to Needy Families (TANF) money—the welfare reform block grant that replaced Aid to Families with Dependent Children (AFDC) in 1996—in addition to Substance Abuse and Mental Health block grants, to expand their substance-abuse treatment for welfare recipients. Senator Martha Yeager Walker, chair of the West Virginia Senate Health and Human Services Committee, noted at the 1998 National Conference of State Legislature that: "We need to reach these hard-to-serve welfare recipients, those struggling with substance abuse, domestic violence or other impediments to self-sufficiency. Our welfare caseloads are dropping, and those left on the rolls will be parents who need intensive services. It is critical, not only for their individual self-sufficiency, but also for their children." However, as welfare caseloads in many states crept back up in the wake of the 2001 recession and its feeble recovery, fewer TANF dollars were available for these kinds of purposes, as more resources had to be allocated to cash assistance and other core programs. As of 2005, many states' TANF budgets were in crisis, resulting in a contraction of services offered to welfare recipients, including drug treatment, according to reports by such think tanks as the Center on Budget and Policy Priorities, the Center for Law and Social Policy, and others.