Substance Abuse Treatment: VA Programs Serve Psychologically and
Economically Disadvantaged Veterans (Letter Report, 11/05/96,
GAO/HEHS-97-6).

Pursuant to a congressional request, GAO reviewed the Department of
Veterans Affairs' (VA) substance abuse program and the effect of VA
reorganization on this program, focusing on: (1) characteristics of
veterans who receive substance abuse treatment; (2) services VA offers
to veterans with substance abuse disorders; (3) methods VA uses to
monitor the effectiveness of its substance abuse treatment programs; (4)
community services available to veterans who suffer from substance abuse
disorders; and (5) implications of changing VA methods for delivering
substance abuse treatment services.

GAO found that: (1) in fiscal year 1995, VA substance abuse treatment
units served about 180,000 veterans; (2) about one half of the
inpatients were homeless at the time of admission and about one third
had psychiatric disorders; (3) many of these veterans were chronically
unemployed, had problems maintaining relationships, reported low
incomes, or were criminal offenders; (4) VA provides a variety of
treatment settings and approaches; (5) between fiscal years 1991 and
1996, VA funding for treatment increased from $407 million to $589
million to accommodate growth in the substance abuse treatment program;
(6) VA lacks the necessary data to adequately measure and fully evaluate
the efficacy of its many treatment programs and has primarily relied on
utilization information and recidivism rates to monitor the quality of
its substance abuse treatment programs; (7) VA is developing a
performance monitoring system based on treatment outcome measures; (8)
numerous non-VA substance abuse treatment programs are also available to
and used by veterans; (9) many veterans treated in community-based
public programs are like those treated in VA programs; (10) if VA
stopped treating veterans for substance abuse, resulting societal costs
may shift to welfare or other social services, other federal or state
substance abuse treatment programs, and the criminal justice system;
(11) VA cannot ascertain the implications of contracting for these
services, since it lacks critical information on the health care needs
of eligible veterans, the number of veterans who might seek care, and
actual cost of treating veterans with substance abuse disorders; and
(12) VA officials have not decided how substance abuse treatment
services will be delivered and what outcome measures will be used to
evaluate treatment and program effectiveness.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  HEHS-97-6
     TITLE:  Substance Abuse Treatment: VA Programs Serve 
             Psychologically and Economically Disadvantaged Veterans
      DATE:  11/05/96
   SUBJECT:  Drug treatment
             Drug abuse
             Alcohol abuse
             Veterans benefits
             Veterans hospitals
             Federal agency reorganization
             Demographic data
             Community health services
             Mental illnesses
             Health services administration
IDENTIFIER:  VA Veterans Integrated Service Network
             Chicago (IL)
             Denver (CO)
             Seattle (WA)
             Colorado
             Illinois
             VA Quality Improvement Checklist
             
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Cover
================================================================ COVER


Report to the Chairman and Ranking Minority Member, Committee on
Veterans' Affairs, U.S.  Senate

November 1996

SUBSTANCE ABUSE TREATMENT - VA
PROGRAMS SERVE PSYCHOLOGICALLY AND
ECONOMICALLY DISADVANTAGED
VETERANS

GAO/HEHS-97-6

Substance Abuse Treatment Programs

(101482)


Abbreviations
=============================================================== ABBREV

  ASI - Addiction Severity Index
  JCAHO - Joint Commission on Accreditation of Healthcare
     Organizations
  VA - Department of Veterans Affairs
  VISN - Veterans Integrated Service Network

Letter
=============================================================== LETTER


B-271298

November 5, 1996

The Honorable Alan K.  Simpson
Chairman
The Honorable John D.  Rockefeller IV
Ranking Minority Member
Committee on Veterans' Affairs
United States Senate

Substance abuse is a chronic, relapsing medical disorder that
afflicts a significant number of Americans, including veterans who
get their health care from Department of Veterans Affairs' (VA)
medical centers.  In fiscal year 1995, more than 125,000 (about 25
percent) of all VA patients discharged from inpatient settings had a
primary or secondary diagnosis of substance abuse (alcohol and/or
drug dependency).  VA estimates that it spent $2 billion, or about 12
percent of its health care budget in fiscal year 1995, to treat
veterans with substance abuse disorders. 

The VA health care system is currently reorganizing and evaluating
what services to offer and where to provide those services.  The new
organizational structure, called the Veterans Integrated Service
Network (VISN), essentially replaces VA's central office and regional
structure with 22 networks of hospitals and clinics.  The networks
are consolidating and realigning services within their areas to
provide an interlocking, interdependent system of care.  VA expects
this consolidation and realignment to improve efficiency by trimming
management layers, eliminating duplicative medical services, and
better using available public and private resources. 

To better understand VA's current substance abuse program and the
effect of VA's reorganization on this program, you asked us to
provide the following information: 

  -- characteristics of veterans who receive substance abuse
     treatment,

  -- services VA offers to veterans with substance abuse disorders,

  -- methods VA uses to monitor the effectiveness of its substance
     abuse treatment programs,

  -- community services available to veterans who suffer from
     substance abuse disorders, and

  -- implications of changing VA's current methods for delivering
     substance abuse treatment services. 

Our work focused on VA medical center inpatient and outpatient units
designated specifically for substance abuse treatment.  We did not
examine medical, surgical, or psychiatric units that may also provide
substance abuse treatment.  We gathered demographic and program data
from VA reports and fiscal year 1995 VA patient treatment files, the
most recent files available.  We interviewed senior officials at VA
headquarters and VA medical centers in Chicago, Denver, and Seattle
and national experts in substance abuse treatment about program
monitoring.  We conducted case studies in Colorado and Illinois to
obtain information about non-VA substance abuse programs and spoke
with federal, state, and private-
sector officials about these services' availability to and use by
veterans.  Finally, we reviewed the literature and discussed with VA
and non-VA officials the potential implications of eliminating VA's
substance abuse services or contracting these services out to non-VA
providers.  We did our work between November 1995 and July 1996 in
accordance with generally accepted government auditing standards. 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

In fiscal year 1995, VA inpatient and outpatient substance abuse
treatment units served about 180,000 veterans.  Our analysis showed
that about half of the inpatients were homeless at the time of
admission, and about a third also had psychiatric disorders.  Many of
these veterans were chronically unemployed, had problems maintaining
relationships, reported low incomes, or were criminal offenders. 
Over 75 percent of the veterans treated served during or after the
Vietnam War era. 

To respond to the demand for treatment, VA has established 389
substance abuse treatment programs at over 160 medical centers.  A
variety of treatment settings is available, such as inpatient and
extended-care programs, outpatient clinics, and residential
rehabilitation programs.  VA uses a variety of treatment approaches,
such as Alcoholics Anonymous's 12-Step program and cognitive
behavioral therapy.  Between fiscal years 1991 and 1996, VA's funding
for treatment increased from $407 million to $589 million to
accommodate its growing substance abuse treatment program.  Although
the number of inpatients and inpatient programs at VA medical centers
has remained fairly stable since fiscal year 1991, the number of
outpatients and outpatient programs has grown significantly--from 37
percent and 78 percent, respectively, during this time period. 

VA currently lacks the necessary data to adequately measure and fully
evaluate the efficacy of its many treatment programs.  To monitor the
quality of its substance abuse treatment programs, VA has primarily
relied on utilization information and recidivism rates (relapses
within 1 year of treatment).  However, like other providers of
substance abuse treatment services, VA is developing a performance
monitoring system based on treatment outcome measures. 

In addition to VA's many substance abuse services for veterans,
numerous non-VA substance abuse treatment programs are also available
to and used by veterans.  In Colorado, for example, non-VA substance
abuse treatment programs served nearly 10,000 veterans in fiscal year
1995.  Many veterans treated in community-based public programs are
like those treated in VA programs. 

Changing the delivery of VA substance abuse treatment services may
have significant implications.  For example, if VA stopped treating
veterans for substance abuse, resulting societal costs may shift to
welfare or other social services, other federal or state substance
abuse treatment programs, and the criminal justice system.  The
implications of VA's contracting out for these services rather than
providing them directly are difficult to ascertain at this time,
however.  This is because VA lacks critical information needed to
make realistic assessments, such as the health care needs of eligible
veterans, the number veterans who might seek care, and the actual
cost of treating veterans with substance abuse disorders. 

VA's current reorganization is unprecedented.  Directors of the newly
created VISNs and other VA officials have not yet decided how
substance abuse treatment services will be delivered and what outcome
measures will be used to evaluate treatment and program
effectiveness.  Once these decisions are made, VA treatment outcomes
can be compared with the outcomes of other substance abuse treatment
programs, and the feasibility and cost of contracting these services
out can be better assessed. 


   BACKGROUND
------------------------------------------------------------ Letter :2

VA began providing formal treatment for alcohol dependency in the
late 1960s and treatment for drug dependency in the early 1970s. 
According to VA, the guiding principle behind its national substance
abuse treatment program has been the development of a comprehensive
system of care for veterans.  In accordance with this principle, VA
has developed a network system of care that is supposed to afford
veterans access to facilities offering a range of substance abuse
treatment services, including inpatient, residential, and ambulatory
care. 

VA requires its medical centers to maintain quality assurance
programs so that veterans receive quality care.  Such care is defined
as the degree to which health services increase the likelihood of
desired health outcomes and are consistent with current professional
knowledge.  Quality assurance programs measure whether quality care
is provided and use performance indicators to measure whether
established standards have been met.\1


--------------------
\1 Performance indicators can be classified as (1) structure:  the
capacity of a provider or institution to deliver quality health care,
for example, the ratio of nurses to inpatient beds; (2) process: 
provider activities performed to deliver the care, such as adherence
to 12-Step program protocols; and (3) outcomes:  the results of
provider activities, such as veterans abstaining from alcohol for 1
year and patient satisfaction with treatment provided. 


   VA SERVES A PROBLEMATIC VETERAN
   POPULATION
------------------------------------------------------------ Letter :3

VA's substance abuse treatment programs serve a population
characterized as psychologically and economically devastated.  For
example, in fiscal year 1995, nearly one-half of veterans in
substance abuse treatment inpatient units were homeless at the time
of admission, and 35 percent had both substance abuse and one or more
psychiatric disorders.  In addition, veterans treated in substance
abuse treatment units were chronically unemployed, had problems
maintaining relationships, reported low incomes, or were criminal
offenders. 

In fiscal year 1995, VA treated 57,776 veterans in inpatient
substance abuse treatment units and 121,812 veterans in outpatient
substance abuse treatment units (see table 1).  About 70 percent of
these veterans were eligible for VA health care because of their low
incomes rather than because of a service-connected disability.  More
than 50 percent of the veterans were Vietnam War-era veterans and
another 25 percent served after that time.  Only 6 percent of the
inpatients and 9 percent of the outpatients had a service-connected
disability of 50 percent or more. 



                          Table 1
          
              Demographics: Veterans Receiving
             Substance Abuse Treatment, FY 1995

                    Inpatients          Outpatients
                    (57,776)            (121,812)
------------------  ------------------  ------------------
Nonservice          74 percent          69 percent
connected

Service connected   25 percent          31 percent

Pre-Vietnam War     14 percent          20 percent

Vietnam War era     54 percent          53 percent

Post-Vietnam War    27 percent          24 percent

Median age          43 years            45 years
----------------------------------------------------------
Characteristics of veterans treated in inpatient and outpatient
substance abuse treatment units differed somewhat from veterans
treated in VA's medical and surgical units.  Veterans in the medical
and surgical units were older than those in the treatment units. 
Their median age was about 59, compared with veterans in all
substance abuse treatment units, whose median age was 43. 
Furthermore, more veterans in medical and surgical units were
eligible for VA treatment because of their service-connected
disability than were veterans being treated in substance abuse
treatment units.  About 34 percent of the inpatients and 47 percent
of the outpatients seen in medical and surgical units had a
service-connected disability, compared with 25 percent and 31
percent, respectively, for veterans in all substance abuse treatment
units. 


   VA OFFERS A VARIETY OF
   SUBSTANCE ABUSE TREATMENT
   SERVICES
------------------------------------------------------------ Letter :4

VA strives to offer a continuum of services to treat veterans
nationwide with substance abuse disorders.  Since fiscal year 1990,
VA has used additional funds to expand the number of substance abuse
treatment programs, patients treated, and staff.  The additional
funds, accompanied by an increased emphasis on outpatient treatment,
have resulted in significantly increasing the number of outpatients
served at VA medical centers. 


      VA HAS A VARIETY OF PROGRAMS
      AND TREATMENT APPROACHES
---------------------------------------------------------- Letter :4.1

VA operates 389 substance abuse treatment programs at more than 160
medical centers throughout the United States and Puerto Rico.  These
programs include 203 inpatient or extended-care programs, 152
outpatient programs, 22 methadone maintenance clinics, 9 residential
rehabilitation programs, and 3 early intervention programs. 
Typically, these medical centers provide a combination of treatment
settings, incorporating inpatient or extended-care programs,
outpatient clinics, and residential rehabilitation programs.  VA
provides most substance abuse programs directly.  However, it does
rely on some non-VA facilities, such as community residential
facilities, to provide some services.\2 Figure 1 shows the locations
and types of VA substance abuse programs provided as of October 1,
1994. 

   Figure 1:  VA Substance Abuse
   Programs by 22 VISNS

   (See figure in printed
   edition.)

Note:  Programs as of October 1, 1994. 

Like other providers, VA uses a variety of approaches in treating
veterans with substance abuse disorders.  Table 2 describes the
treatment approaches used in VA programs. 



                          Table 2
          
          VA's Drug and Alcohol Program Treatment
                         Approaches

Program             Treatment approaches
------------------  --------------------------------------
Alcoholics          Emphasis on Alcoholics Anonymous and
Anonymous/12 Step   Narcotics Anonymous goals and
                    activities, such as helping patients
                    accept that they are powerless over
                    the abused substance and working
                    through the 12 steps

Cognitive           Emphasis on developing confidence in
behavioral          coping with high-risk situations for
                    relapse and helping patients identify
                    alternative responses to using drugs
                    or alcohol

Social              Emphasis on improving communication
                    and interpersonal skills and on
                    teaching patients how to enhance
                    assertiveness

Insight             Emphasis on understanding how
                    substance abuse dependencies develop
                    and on gaining new insights into
                    personal relationships

Marital/family      Emphasis on strengthening marital and
systems             family relationships and on involving
                    spouses and other family members in
                    treatment

Therapeutic         Emphasis on accepting personal
community           responsibility for decisions and
                    actions and on assigning patients
                    chores or duties as part of the
                    treatment

Rehabilitation      Emphasis on developing better work
                    habits and on acquiring new job skills

Dual diagnosis      Emphasis on using specialized
                    treatment for patients who have both
                    substance abuse and psychiatric
                    problems

Medical             Emphasis on using medications to
                    lessen withdrawal symptoms and on
                    using formal diagnoses as the basis of
                    treatment plans
----------------------------------------------------------

--------------------
\2 VA spends about $10 million annually to place veterans in
community residential facilities. 


      ADDITIONAL FUNDS EXPANDED
      TREATMENT CAPACITY
---------------------------------------------------------- Letter :4.2

As part of the President's national drug policy program, VA received
$105 million annually in recurring funds in fiscal years 1990 to
1993.  VA used these funds to expand substance abuse treatment
services to more eligible veterans.  The additional funds and
emphasis on outpatient treatment resulted in significantly increasing
the number of outpatients served at VA medical centers. 

As shown in figure 2, obligations for VA substance abuse treatment
programs increased about 45 percent, from $407 million to $589
million from fiscal years 1991 to 1996. 

   Figure 2:  VA Substance Abuse
   Program Obligations, FY
   1991-1996

   (See figure in printed
   edition.)

Note:  Fiscal year 1996 total is estimated. 

Source:  VA budget data. 

As shown in figures 3 and 4, the number of inpatients and inpatient
programs has remained fairly stable over the years; the number of
outpatients and outpatient programs has grown significantly, however. 
According to VA, the number of inpatients served in VA substance
abuse treatment units declined slightly from 58,500 to 55,200
patients in fiscal years 1988 to 1995.  The number of outpatients in
substance abuse treatment in those same fiscal years rose
dramatically, however, from 38,300 to 68,300 patients--about a
78-percent increase.\3

   Figure 3:  Number of Inpatients
   and Outpatients Treated in VA
   Substance Abuse Units, FY
   1988-1995

   (See figure in printed
   edition.)

Note:  Outpatient statistics exclude veterans who also received
inpatient substance abuse treatment during the same fiscal year. 

Source:  Program Evaluation and Resource Center, Palo Alto,
California. 

   Figure 4:  Number and Types of
   VA Substance Abuse Treatment
   Programs, FY 1991 and 1994

   (See figure in printed
   edition.)

Note:  "Other" includes nine residential rehabilitation and three
early intervention programs. 

Source:  Program Evaluation and Resource Center, Palo Alto,
California. 

A similar trend has occurred in the number of inpatient and
outpatient treatment programs.  The number of inpatient programs
increased from 174 to 180 (about 4 percent) between fiscal years 1991
and 1994.  However, the number of outpatient programs increased from
111 to 152--about a 37-percent increase. 

Traditionally, medical center directors determined the extent to
which their centers offered substance abuse treatment services.  This
may change, however, under the VISN structure.  The VISN directors,
who are accountable to the Under Secretary for Health for their
VISNs' performance, are charged with providing coordinated services
for all eligible veterans living within their network areas. 
Although VISN directors and the respective medical center directors
have discussed possible changes to the substance abuse treatment
programs, no changes had yet been made during the time of our study. 
On the basis of discussions with VA officials, however, some current
programs will likely be consolidated and others will likely change
focus. 


--------------------
\3 Our analysis of fiscal year 1995 patient treatment files showed a
higher number of substance abuse patients than VA reported.  The
major difference stems from outpatient treatment file data that
include veterans who received both inpatient and outpatient treatment
in fiscal year 1995.  For trend analysis, we relied on data reported
to VA's Program Evaluation and Resource Center, which excludes those
outpatients also treated as inpatients in substance abuse treatment
units in the same fiscal year. 


   VA IS CHANGING ITS QUALITY
   MANAGEMENT PHILOSOPHY
------------------------------------------------------------ Letter :5

VA currently lacks the necessary data to adequately measure and fully
evaluate the efficacy of its many treatment programs.  VA is
therefore developing a new performance monitoring system, using new
outcome measures, to compare treatment and program effectiveness both
internally and with non-VA substance abuse treatment providers.  VA's
efforts compare with outcome measurement approaches used by non-VA
providers of substance abuse treatment services. 

Substance abuse treatment staff at VA medical centers monitor program
quality through the accreditation process and internal studies.  VA
medical center substance abuse treatment programs must meet the
standards promulgated by the Joint Commission on Accreditation of
Healthcare Organizations (JCAHO).  Through its review process, JCAHO
determines whether each medical center has the necessary programs in
place that should result in good care.  In addition, medical centers
have instituted quality improvement programs, in part to satisfy
accreditation requirements, using a variety of measures.  The medical
centers we visited track readmissions, length of stay, and patient
satisfaction.  At the VA medical center in Denver, for example,
recidivism rates have been monitored since 1988.  At a VA medical
center in Chicago, discharged inpatients are monitored to determine
whether they show up for outpatient follow-up care. 

VA's quality management philosophy and staffing resources have
constrained the central office staff's monitoring role.  Central
office officials have primarily played a consultant role on quality
assurance matters.  This role has been based on VA's philosophy that,
because care takes place at the medical centers, staff at the centers
are the best suited to monitor their programs and take the
appropriate actions to improve care.  Central office officials do,
however, monitor the many substance abuse treatment programs by
reviewing (1) annual reports on the substance abuse treatment
programs at each medical center; (2) reports on program services,
staffing, and utilization from VA's Program Evaluation and Research
Center; (3) the Quality Improvement Checklist, a systemwide quality
improvement tool that includes one indicator about the rate of
readmission for alcohol- and drug-related disorders for patients
discharged from inpatient substance abuse treatment units; and (4)
the results of patient satisfaction surveys.  These officials also
work with staff from the Center for Excellence in Substance Abuse
Treatment and Education to test models of care, help identify best
practices, train students, and provide continuing education in
substance abuse treatment.  Except for the Center's reviews, however,
none of these reviews focuses on the outcomes of the specific
treatments provided. 

In November 1995, in a shift in philosophy, VA central office
officials proposed a systemwide approach to quality management using
a variety of performance indicators, including treatment outcome
measures.  Believing substance abuse to be a chronic disease that
frequently recurs, VA has dropped two previously used indicators,
recidivism and discharge disposition, because staff felt that these
indicators did not adequately measure program success.\4 The new
indicators will rely on data currently collected but not aggregated. 
Three indicators relate to the number of veterans starting substance
abuse treatment programs and visiting outpatient units.  Two
indicators compare the number of patients in and visits to outpatient
substance abuse treatment units with the number of all patients in
and visits to these units as well as the number of patients in all VA
substance abuse treatment units as a percentage of the total number
of patients in care. 

In the future, VA plans to develop other performance indicators based
on data not currently available to assess treatment effectiveness. 
These indicators will be based on data collected through a
standardized data collection instrument, the Addiction Severity Index
(ASI).  The indicators will measure treatment outcomes that include
changes in medical status, employment, alcohol use, drug use,
criminal activity, family and social relationships, and psychiatric
symptoms.  VA is considering administering a comprehensive ASI to all
patients within 3 days of entering any substance abuse treatment
setting and then annually while the patient remains in treatment.  An
abbreviated ASI would be administered after 1 month and again after 6
months of treatment.  Although both VA and non-VA substance abuse
treatment officials agree that patient data collected through the ASI
would be useful in determining the proper treatment and its efficacy,
some are concerned that it may be too expensive and time consuming to
administer. 

The revised performance measures will be used to evaluate individual
substance abuse treatment programs and compare them with each other
as well as with non-VA programs.  For example, VA is already piloting
a performance monitoring system developed by its Program Evaluation
and Research Center.  The system ranks, according to cost and
utilization data, the relative performance of mental health and
substance abuse units among the medical centers and 22 VISNs.  To
ensure that the comparisons fairly assess program performance, VA
intends to account for veteran characteristics, such as other
coexisting medical or psychiatric diseases, that might affect the
outcome of the substance abuse treatment. 

VA's current and planned initiatives to monitor program performance
compare with those used or planned by non-VA providers and managed
behavioral health care organizations we contacted.  For example, one
large managed behavioral health company that has used outcome
measures since 1993 collects information about readmission,
complaints, and patient and provider satisfaction, among other data. 
A large local provider had no systematic outcome measurement efforts
under way at the time of our study, but it would provide data for
requested state or federal studies.  Such data might include
detoxification use, employment, housing, and treatment service use. 
Comparisons of VA's programs with publicly supported non-VA substance
abuse programs should be possible once VA's various programs'
treatment outcomes are known and the data are properly adjusted to
account for any differences in patient characteristics. 


--------------------
\4 Although the goal for VA substance abuse treatment programs is
still complete abstinence, VA recognizes that 40 to 60 percent of the
patients will relapse within a year of treatment.  Therefore, VA and
non-VA providers have developed other measures of treatment success
such as reduced alcohol and drug use. 


   COMMUNITY SERVICES ARE
   AVAILABLE TO AND USED BY
   VETERANS
------------------------------------------------------------ Letter :6

Non-VA substance abuse providers and programs are also available to
and used by veterans.  In Colorado, for instance, approximately 400
facilities that receive some public funding to treat patients with
low incomes served five times the number of veterans treated at the
Denver VA medical center in fiscal year 1995.  The 10,000 veterans
treated by state-funded facilities in Colorado represent about 18
percent of the patients seen at the facilities.  Similarly, in
Illinois, we found that 8,200 patients, about 8 percent of those
treated in facilities receiving state funds, were veterans. 

According to VA officials and officials of the non-VA programs we
visited, veterans who qualify for publicly supported treatments are
like those treated at the VA medical centers.  For example, in
Colorado and Illinois, we found that the veterans treated by
state-funded providers have low incomes and high levels of
unemployment; many were homeless.  Moreover, the vast majority of the
veterans were male--97 percent in both Colorado and Illinois--and
most did not have insurance. 

Although non-VA providers told us they were willing to treat more
veterans, they currently do not have enough staff to do so. 
Therefore, these providers would need additional funding to hire
staff capable of treating a significant number of low-income veterans
with multiple problems. 


   IMPLICATIONS OF CHANGING VA'S
   SERVICE DELIVERY METHODS ARE
   UNCERTAIN
------------------------------------------------------------ Letter :7

The number and health status of eligible veterans, potential demand
for substance abuse treatment services, and the cost of specific
programs are just some of the data needed to determine the
implications of changing VA's service delivery methods.  However, VA
currently has neither this information nor the systems in place to
gather it.  This situation and the decisions VISN directors might
make about what and where services will be offered make it difficult
to estimate the effects of VA's changing its current delivery
structure. 

One possible change to VA's services you asked us to explore is VA's
reducing its substance abuse treatment program.  If VA were to stop
treating veterans for substance abuse, societal costs would likely
increase.  Researchers have indicated that the costs of treating
people with substance abuse disorders tend to shift to other sectors,
including welfare and other social services, other medical providers,
and the criminal justice system, when people go untreated.  Although
we expect that many of VA's substance abuse patients would qualify
for publicly supported treatment programs if VA ended its services,
VA officials told us that some veterans would surely "fall through
the cracks." These officials are concerned about the uneven
distribution of care now provided through state-assisted programs and
about how VA patients would fare in a managed care environment. 

You asked us to look at the implications of VA's contracting out for
substance abuse treatment services instead of eliminating or reducing
the number of such services.  The implications of this approach to VA
and the community are difficult to determine at this time.  VA lacks
information on the health care needs of eligible veterans, the number
of veterans who might seek care if it were more accessible, the
actual cost of treating such veterans, and the outcomes of specific
treatments.  Before contracting out substance abuse treatment
services, VA would have to better understand its patients, treatment
outcomes, and costs.  Only then could it define a number of key
contractual elements, such as the type of service delivery model
preferred, the actual services it would and could afford to cover,
the treatment philosophy to be employed, responsibilities for program
monitoring, and the distribution of financial risks.  The lack of
this information limits our ability to evaluate the
cost-effectiveness of contracting out program services and the
implications of this action on the relative quality of services
veterans might receive. 


   AGENCY COMMENTS
------------------------------------------------------------ Letter :8

VA reviewed a draft of this report and commented that it was a fair
and accurate assessment of its substance abuse program and the
initiatives it has under way. 


---------------------------------------------------------- Letter :8.1

This report was prepared under the direction of Sandra Isaacson,
Assistant Director; Tom Laetz; Mary Needham; and Bill Temmler. 
Should you have any questions, please call me at (202) 512-7111 or
Sandra Isaacson at (202) 512-7174. 

Stephen P.  Backhus
Associate Director
Veterans' Affairs and Military Health Care


*** End of document. ***