Blending Perspectives and Building Common Ground. Substance Abuse Treatment Funding


Nationally, mental health, alcohol, and drug abuse treatment expenditures were $79.3 billion, or 8.1 percent of the $942.7 billion in total health care expenditures in 1996, with $12.6 billion spent on treatment for alcohol and other drug abuse (AOD).  This represents a 10 percent decrease from 1986, when mental health, alcohol, and drug treatment expenditures were 9.0 percent of national health expenditures.

Since 1986, the average annual growth rate for all health care expenditures has been 8.3 percent, while the average annual growth rate of expenditures for alcohol and other drug abuse diagnoses has been 7.0 percent.

Public funding for substance abuse treatment grew from 53 percent of total substance abuse expenditures in 1986 to 63 percent in 1996.  This was countered by a decreasing share of expenditures paid out-of-pocket, while private insurance payments remained relatively constant during this period.

Federal dollars, including the Federal portion of Medicaid, Medicare, DOD, VA, and the Substance Abuse Prevention and Treatment (SAPT) Block Grant, paid for 31 percent of national expenditures on AOD treatment in 1996.  State and local contributions to AOD treatment expenditures were approximately equivalent at 31.5 percent.

SAMHSA's Center for Substance Abuse Treatment (CSAT) is the lead Federal Agency for substance abuse treatment, with responsibility for management of the $1.4 billion SAPT Block Grant.  The SAPT Block Grant is is the cornerstone of the States' substance abuse programs, accounting for about 40% of the public funds expended for treatment and prevention.  This is a formula-driven grant, and it includes several mandatory distributions and set-asides for allocations made to the States:

  • 35% must be used for ALCOHOL prevention and treatment activities;
  • 35% must be used for OTHER DRUG prevention and treatment activities;
  • 20% must be used for prevention activities (estimated at $262 million for 1998);
  • 2% - 5% must be spent on AIDS-related drug abuse programs in States with AIDS case rate of 10 per 100,000 population (reported at $53 million for latest year available);
  • States must spend from their allocation an amount "equal to fiscal year 1994 spending levels" on programs for pregnant women and women with dependent children (reported at $195 million for latest year available); and,
  • up to 5% of a State's allocation may be used for State administration (maximum of approximately $62 million in 1998).

Federal funding for public treatment facilities, as reported on the block grant applications, ranges from 11%-84% of all funding being used for substance abuse treatment.

In 1997, nineteen States received the majority of their funding for support of substance abuse treatment services from the SAPT Block Grant.

Over 7,000 Community Based Organizations (CBOs) receive SAPT Block Grant funding.

It is estimated that the FY 1998 SAPT Block Grant funding supported treatment for approximately 300,000 drug-abusing persons.  While estimates for the number of persons served who only abuse alcohol are not available, it can be estimated that approximately $500 million of the total SAPT Block Grant must be spent on alcohol prevention and treatment programs.

CSAT's other primary funding category, the Knowledge Development and Application Program, provides support for a wide variety of grants to States and other treatment entities in an effort to continually improve the quality of services, implement best practices, and expand service capacity.  For example, in 1998, this initiative provided continuation funding of approximately $82 million for current programs, such as Residential Treatment for Women and Children, Starting Early Starting Smart (SESS) jointly funded by CSAP and CMHS, Supplemental awards for Children's Services, Criminal Justice, Managed Care and Vulnerable Populations, Wrap Around Services, Recovery Networks, Target Cities, Rural Remote and Culturally Distinct, Addiction Technology Centers, and others. CSAT also provided funding for the following new programs in 1998:

  • $23.7 million for forty-one Targeted Capacity Expansion grants, which focus on providing a clinically appropriate range of services, reducing service gaps and reducing drug use and abuse by under-served populations.  Approximately 35% of the grants that were awarded are targeted to addicted women and their children.
  • $8.5 million for fifteen Women and Violence grants (jointly funded with CSAP and CMHS) for studies targeting women, age 18 and above, with co-occurring disorders, who have histories of physical and/or sexual abuse.  If the targeted women are mothers, their dependent children will also be included.
  • $3.7 million for nineteen Recovery Community Support Program (RCSP) grants to State, provider, and community-based organizations for enhancing development of substance abuse treatment programs in 15 States.
  • $3 million for eight Methamphetamine Treatment Program grants to test replicability and cost-effectiveness of specific non-residential programs for treatment of methamphetamine abuse.  This program will contribute to the development of knowledge on methamphetamine treatment and will help support needed treatment in communities impacted by increasing methamphetamine addiction.
  • Approximately $4.4 million for other new grant support in FY 98 knowledge development activities that include women, such as those targeted to Adolescents, Elderly, and Substance Abusing Women Eligible for Temporary Assistance to Needy Families.