Medicaid chemical dependency patients in a commercial health plan

Do high medical costs come down over time?
  • Lawrence J. Walter
  • Lynn Ackerson
  • Steven Allen
Regular Articles


A cohort of 197 Medicaid-insured patients presenting for treatment in Kaiser Permanente's out-patient chemical dependency treatment program were observed the year prior to their program intake visit and followed for 3 years afterwards, to compare their medical costs and utilization to demographically matched commercially insured patients entering the same programs. The Medicaid-insured patients on average incurred medical costs 60% higher than non-Medicaid patients during the 12-month preintake period ($5402 vs $3277). During the 3 years subsequently, however, both groups of chemical dependency patients displayed significant declines in medical costs, averaging 30% from the baseline period to the third year of follow-up. Cost trends reflected declines in use of hospital days, emergency department visits, and nonemergent outpatient visits. These results may help address concerns among Medicaid managed care providers and payers by giving a more realistic account of the long-term costs of this group of high-utilizing enrollees.


Medical Cost Emergency Department Visit Baseline Period Dependency Treatment Chemical Dependency 
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Copyright information

© Association of Behavioral Healthcare Management, NCCBH 2005

Authors and Affiliations

  • Lawrence J. Walter
    • 1
  • Lynn Ackerson
    • 2
  • Steven Allen
    • 3
  1. 1.Division of ResearchOakland
  2. 2.the Kaiser Permanente Medical Care ProgramNorthern California Region, Division of ResearchOakland
  3. 3.the Vallejo Chemical Dependency Recovery Program in the Kaiser Permanente Medical Care ProgramNorthern California RegionOakland

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