Cost-effectiveness of inpatient substance abuse treatment

To identify the characteristics of cost-effective inpatient substance abuse treatment programs. A survey of program directors and cost and discharge data for study of 38,863 patients treated in 98 Veterans Affairs treatment programs. We used random-effects regression to find the effect of program and patient characteristics on cost and readmission rates. A treatment was defined as successful if the patient was not readmitted for psychiatric or substance abuse care within six months. Treatment was more expensive when the program was smaller, or had a longer intended length of stay (LOS) or a higher ratio of staff to patients. Readmission was less likely when the program was smaller or had longer intended LOS; the staff to patient ratio had no significant effect. The average treatment cost $3,754 with a 75.0% chance of being effective, a cost-effectiveness ratio of $5,007 per treatment success. A 28-day treatment program was $860 more costly and 3.3% more effective than a 21-day program, an incremental cost-effectiveness of $26,450 per treatment success. Patient characteristics did not affect readmission rates in the same way they affected costs. Patients with a history of prior treatment were more likely to be readmitted but their subsequent stays were less costly. A 21-day limit on intended LOS would increase the cost-effectiveness of treatment programs. Consolidation of small programs would reduce cost, but would also reduce access to treatment. Reduction of the staff to patient ratio would increase the cost-effectiveness of the most intensively staffed programs.