The Effect of Public Insurance Expansions on Substance Use Disorder Treatment: Evidence from the Affordable Care Act

We examine the effect of Medicaid expansion under the Affordable Care Act (ACA) on substance use disorder (SUD) treatment utilization and financing. We combine data on admissions to specialty facilities and Medicaid‐reimbursed prescriptions for medications commonly used to treat SUDs in nonspecialty outpatient settings with an event‐study design. Several findings emerge from our study. First, among patients receiving specialty care, Medicaid coverage and payments increased. Second, the share of patients who were uninsured and who had treatment paid for by state and local government payments declined. Third, private insurance coverage and payments increased. Fourth, expansion also increased prescriptions for SUD medications reimbursed by Medicaid. Fifth, we find suggestive evidence that admissions to specialty treatment may have increased one or more years post‐expansion. However, this finding is sensitive to specification and we observe differential pretrends between the treatment and comparison groups. Thus, our finding for admissions should be interpreted with caution.