No one denies that substance abuse treatment is expensive. However, many ordinary people and legislators do not realize that it is far costlier when people with substance abuse disorders go without treatment. Homelessness is more likely, more children end up in foster care or orphaned, and addicts are likelier to end up hospitalized or incarcerated, all of which are expensive.

The National Institute on Drug Abuse (NIDA) estimates that addiction costs the United States economy more than $740 billion per year due to increased crime, loss of productivity, and healthcare services. This figure includes the most common addictions, tobacco and alcohol, as well as addictions to illegal substances. Paying for substance abuse treatment is a nonstarter for millions of Americans due to the cost, whether or not they have health insurance coverage that would help.

Out of Pocket Costs Out of Reach for Many

Medicaid helps with the costs of substance abuse treatment for millions of Americans, and without Medicaid, many of them cannot afford treatment, particularly when it involves medication-assisted treatment. As just one example, some opioid addicts receive a drug called Vivitrol once a month to block the effects of opioids – meaning that opioids no longer get them high.

This drug costs around $1,000 per dose, something most ordinary people cannot afford. Typically, medication-assisted substance abuse treatment is accompanied by therapy and recovery coaching, both of which are expensive, and generally covered through Medicaid. These expenses, however, are dwarfed by the expense of untreated addiction to families and society.

Proposed Cuts to Medicaid Under New GOP Healthcare Bill

In May, the Republican-sponsored healthcare reform bill passed the U.S. House of Representatives and is now being considered in the Senate. This bill would cut Medicaid spending by more than $800 billion over 10 years and has widespread GOP support. The states that would likely be most affected by passage of the bill would be those that elected to expand Medicaid coverage with the Affordable Care Act which was passed in 2010.

Some GOP legislators want states to pay a higher share of Medicaid expansion costs, and this is likely to cause many states to reverse Medicaid expansion, causing millions of people to lose coverage. Moreover, it would open the door for insurers to consider addiction as a pre-existing condition, pricing private insurance out of reach for many more people.

The Business Case for Treatment Coverage

Substance abuse treatment is expensive, whether it is paid for out of people’s pockets, through private insurance, or by Medicaid. However, untreated substance abuse disorders are overwhelmingly more expensive.

Consider this real-life example. Recovered crack addict Tonier Cain was arrested 83 times and convicted 66 times before getting help for her addiction. She considers herself living proof that substance abuse treatment saves lives, families, communities, and also saves money.

In order to even receive substance abuse treatment, Cain asked a judge to give her a longer jail sentence to make her eligible for a treatment program. That request paid off, and now Cain is a homeowner, and a worker, wife, and mother as well. “My untreated crack habit cost U.S. taxpayers millions of dollars,” she told the Senate Health Committee in June.

Substance abuse disorder affects millions of Americans, and the indirect effects have an impact on all Americans. The state of New Hampshire has experienced a nearly 200 percent increase in overdose deaths since 2012, and Ohio and Kentucky have also seen alarming increases in overdose deaths due to opioid addiction. The Cook County jail in Illinois (which serves the city of Chicago) is considered the largest “mental health facility” in the country due to addiction and other mental health conditions that result in criminal acts.

Medicaid cuts that reduce access to substance abuse treatment may appear to save money. However, the money that is allegedly saved because of Medicaid cuts will be spent quickly by the costs of untreated addiction. Those costs not only include non-reimbursed emergency medical costs, but also costs of incarceration, and the costs that families and communities incur when people with substance abuse disorders have to go untreated. If you would like to learn more about substance abuse treatment and why it works, we encourage you to contact us at any time.

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