Market Barriers to the Development of Pharmacotherapies for the Treatment of Cocaine Abuse and Addiction: Final Report. National Expenditures on Cocaine Treatment

09/12/1997

National expenditures for specialized alcohol and drug treatment were about $6.5 billion in 1993, or $19.71 per-patient-per-day for all treatment (Figure 9 below). Approximately $2.6 billion of this amount was spent on outpatient care (i.e., $1.94 billion and $0.65 billion for outpatient-standard and outpatient-intensive care, respectively), or only about $8.89 per-patient-per-day for outpatient care. In contrast, expenditures for the 103,000 daily enrolled patients receiving 24-hour care (i.e., all modalities except for detox-ambulatory and both outpatient modalities) were $3.87 billion, or about $103 per-patient-per-day. Expenditures for the approximately 80 percent of substance abuse patients who are in standard outpatient care were $7.38 per-patient-per-day.

Figure 9: Substance Abuse Treatment Services & Spending, 1993
MODALITY OF CARE Daily Clients Enrolled Annual Revenue ($ in millions) Revenue per Patient ($ per day)
Detox-Ambulatory 6,700 $72  $29.66 
Detox-Freestanding 6,400 $267  $114.33 
Detox-Hospital 7,300 $1,005  $375.22 
Rehab-Hospital 14,300 $881  $168.53 
Rehab-Short Term 15,000 $587  $107.53 
Rehab-Long Term 60,100 $1,127  $51.42 
Outpatient-Intensive 78,000 $649  $22.77 
Outpatient-Standard 719,100 $1,937  $7.38 
TOTAL 906,800 $6,525  $19.71 
Source: Office of Applied Studies, SAMSHA, 1995

The estimates of revenue were based on the NDATUS compilation of $3.9 billion from centers that reported revenue, plus an estimated $2.6 billion to account for centers that did not report revenue. Estimates were based on the number of daily patients, by type/modality of care, multiplied by revenue per day (column 4 of the figure above) from reporting "single modality" providers.

Expenditures for specialty treatment for cocaine abuse total approximately $2.1 billion, including about $1.26 billion for the approximately 150,000 primary cocaine addicts and $0.84 billion for the approximately 100,000 secondary cocaine addicts (Figure 10 below). Expenditures averaged $9.00 per day per patient enrolled in standard outpatient treatment and $23.00 per day per patient enrolled in any modality of care (i.e., including outpatient and inpatient care).

Figure 10: Estimated Annual Revenue for Treatment of Cocaine Addicts
All Primary Cocaine Addicts, Adjusted up by 2/3 for Secondary Addicts
MODALITY OF CARE Average Daily Enrollment Annual Revenue ($ in millions) Primary Cocaine Admits (percent) Revenue for Primary and Secondary Patients ($ in millions)
Detox-Ambulatory 6,700 $72  2.2 $3 
Detox-Freestanding 6,400 $267  17.2 $77 
Detox-Hospital 7,300 $1,005  12.6 $211 
Rehab-Hospital 14,300 $881  18.6 $274 
Rehab-Short Term 15,000 $587  22.5 $221 
Rehab-Long Term 60,100 $1,127  32.2 $606 
Outpatient-Intensive 78,000 $649  22.4 $243 
Outpatient-Standard 719,100 $1,937  14.5 $469 
TOTAL 906,800 $6,525  17.1 $2,103 
Source: Analysis by The Lewin Group. Daily enrollment and annual revenue (imputations for missing data) from 1993 NDATUS (OAS, 1996). Share of clients by modality from TEDS (OAS, 1997). Cocaine share by modality increased by 2/3 to adjust for share of secondary cocaine patients.

Although cocaine addicts account for 17.1 percent of all substance abuse admits, they account for higher percentages in the more intensive and expensive treatment settings such as rehabilitation centers and outpatient-intensive care (OAS 1997). Consistent with development of the estimate of daily cocaine addicts in treatment, the revenue estimate is based on 250,000 daily patients, including 150,000 daily primary cocaine patients and 100,000 daily secondary cocaine patients.