Using the DATCAP and ASI to estimate the costs and benefits of residential addiction treatment in the State of Washington

Funding agencies and policy makers often criticize residential addiction treatment because the cost of residential services is typically higher than for outpatient services and it is unclear whether the outcomes are significantly better for most clients. To address these concerns, proponents of residential treatment require economic evidence to justify further investments in this modality over less intensive and less costly options. Recent studies have developed methods and empirical guidelines for using the drug abuse treatment cost analysis program (DATCAP) and the addiction severity index (ASI) in a comprehensive economic evaluation of addiction treatment. The present study applied these methods and guidelines to estimate the economic costs and benefits of residential addiction treatment at five programs in the State of Washington, USA that serve publicly funded clients. Program- and client-specific economic cost estimates were derived using data collected on-site with the DATCAP along with opportunity cost estimates associated with treatment attendance. Economic benefits were calculated from client self-reported information at treatment entry and at 6 months post discharge using the ASI. Outcome categories included inpatient services, employment, medical and psychiatric conditions, and criminal activity. Results indicate that average weekly economic cost of treatment services at the five programs ranged from $463 to $703. Average (per client) economic cost of treatment was $4912 (composed of $3650 in program cost and $1262 in client cost) for all subjects that completed both a baseline and follow-up questionnaire (N=222; 82%). Average (per client) total economic benefit was $21,329, leading to estimates of $16,418 for average net benefit and 4.34 for the benefit-cost ratio. Total and net economic benefits were significantly related to gender, race, religious preference, and baseline ASI composite scores for drug use and legal status. A detailed sensitivity analysis did not alter the qualitative findings. This study provides conclusive evidence that, for this sample of programs in Washington State, the economic benefits of residential addiction treatment significantly exceeded the economic costs. Although the results are not necessarily generalizable to private-paying clients or clients from other States in the US, the methods are based on widely used data collection instruments and well-accepted economic principles. Thus, extensions of this research to other clients, States, and modalities should be feasible and straightforward.