Department of Health and Human Services 
OFFICE OF 
INSPECTOR GENERAL 
Follow-up to Detoxification Services For 
Medicaid Beneficiaries 
JUNE GIBBS BROWN 
Inspector General 
NOVEMBER 1998 
OEI-07-97-00270  OFFICE OF INSPECTOR GENERAL 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, is to 
protect the integrity of the Department of Health and Human Services programs as well as the 
health and welfare of beneficiaries served by them.  This statutory mission is carried out through a 
nationwide program of audits, investigations, inspections, sanctions, and fraud alerts.  The 
Inspector General informs the Secretary of program and management problems and recommends 
legislative, regulatory, and operational approaches to correct them. 
Office of Evaluation and Inspections 
The Office of Evaluation and Inspections (OEI) is one of several components of the Office of 
Inspector General.  It conducts short-term management and program evaluations (called 
inspections) that focus on issues of concern to the Department, the Congress, and the public.  The 
inspection reports provide findings and recommendations on the efficiency, vulnerability, and 
effectiveness of departmental programs. 
OEI's Kansas City regional office  prepared this report under the direction of James H. Wolf, 
Regional Inspector General.  Principal OEI staff included: 
REGION  HEADQUARTERS

Dennis Tharp, Project Leader
 Elise Stein, Program Specialist

Tim Dold

Perry Seaton

Hugh Owens

Michael Barrett

Linda Paddock

To obtain copies of this report, please call the Kansas City Regional Office at (816) 426-3697 
Reports are also available on the World Wide Web at our home page address: 
http://www.dhhs.gov/progorg/oei  E X E C U T I V E  S U M M A R Y

PURPOSE 
To assess whether Medicaid and other State programs provide linkages for patient services 
between substance abuse detoxification and follow-up treatment programs. 
BACKGROUND 
Detoxification and substance abuse treatment are funded federally by the Health Care Financing 
Administration (HCFA) and the Substance Abuse and Mental Health Services Administration 
(SAMHSA).  Annually, the SAMHSA spends over $1.5 billion on substance abuse prevention and 
treatment services.  In addition, HCFA covers substance abuse detoxification and treatment in 
most State Medicaid programs. 
Substance abuse detoxification is the process through which a person who is physically dependent 
on alcohol, illegal drugs, prescription medications, or a combination of these is withdrawn from 
the drugs of dependence.  Detoxification, the vital first step of the rehabilitative process, has 
moved in some States from inpatient hospitalization settings to outpatient programs.  However, 
many treatment professionals expressed concerns that individuals enrolled in detoxification 
programs may not receive follow-up substance abuse treatment. 
We obtained information on detoxification and treatment programs through a mail survey to each 
Medicaid State agency.  Analysis was conducted and follow-up contacts were made to clarify 
responses and to obtain additional information based on survey data. 
FINDINGS 
Fifteen States Report Having Formal Processes Providing Transition from Substance Abuse 
Detoxification to Treatment; Thirty-two have Informal Processes 
Fifteen States said they had written language addressing continuum of care in their Medicaid State 
plan, Medicaid managed care contract, or the States quality assurance plan.  Thirty-two of 35 
remaining States report having informal processes to provide a transition for Medicaid 
beneficiaries to move from substance abuse detoxification to substance abuse treatment programs. 
Also, States without Medicaid-funded detoxification programs coordinate arrangements with 
other treatment entities outside the Medicaid program to facilitate a continuum of care. 
States Tailor Substance Abuse Programs to Complement Their Own Service Delivery Systems 
Substance abuse programs have evolved over the years into very State-specific oriented activities, 
with State directors of alcohol and drug abuse services choosing programs that they believe 
function optimally in their own particular State.  States utilize a variety of treatment settings and 
types of staff in their Medicaid substance abuse programs to ensure that integrated systems of 
care exist for Medicaid beneficiaries in their State. 
))))))))))) 
i  States Have Limited Data on Detoxification and Treatment Activity and Outcomes 
We found that States vary in their capturing of quality and performance data.  Over three-fourths 
of the States could not provide data on the average time elapsed for Medicaid beneficiaries from 
discharge from a detoxification program to onset of treatment.  As a result, States which do not 
capture information on continuum of care linkages have little basis to assess whether beneficiaries 
are receiving timely treatment services. 
One-Third of States Conduct Performance Monitoring of Substance Abuse Programs 
Sixteen States report having performance oversight efforts which include case record reviews and 
site visits.  Also, some managed care programs include performance requirements as part of their 
quality assurance plans. 
States Seldom Use Outpatient Settings for Detoxification Services 
Only 30 percent of States employ an outpatient component for detoxification services.  Five 
States utilize a Medicaid outpatient detoxification component on a primary basis while another 10 
States use outpatient detoxification services on an alternative or less-extensive basis.  In contrast, 
40 States cover Medicaid outpatient treatment programs, and 33 States have inpatient treatment 
programs available.  Half of the States cover both Medicaid inpatient and outpatient treatment 
programs. 
RECOMMENDATION 
SAMHSA and HCFA Should Work With States to Develop Appropriate Performance 
Measures 
The SAMHSA should work with State agencies to develop performance indicators that measure 
linkages from substance abuse detoxification to treatment.  We believe this will help ensure that 
linkages and coordination are a priority for improvement, and that Medicaid beneficiaries are not 
merely engaging in detoxification without treatment. 
The SAMHSA and HCFA should collaborate and encourage State Medicaid agencies to include 
language regarding continuity of substance abuse services in their managed care contracts. 
The SAMHSA and HCFA also should work with States to facilitate enhanced data collection on 
the continuum of care.  Such treatment and outcome data are essential to capture information on 
what is occurring in the treatment field.  This will enable reasonable conclusions to be drawn to 
enhance the quality of existing programs. 
AGENCY COMMENTS 
Both HCFA and SAMHSA concurred with our recommendation but emphasized they cannot 
ensure that States meet goals and provide treatment and outcome data.  However, they expressed 
))))))))))) 
ii  a willingness to work with States in these efforts and toward greater continuity for treatment care 
following detoxification services. 
The SAMHSA also suggested exploring mechanisms for shifting to greater use of outpatient 
detoxification services which have been shown to be as safe and effective as, and more cost 
efficient than, inpatient detoxification.  We agree this issue is important and warrants further 
examination.  However, while our report contains a finding on the uneven use of this service 
among the States, our study was not sufficient to draw conclusions on outpatient detoxification 
safety and efficiency. 
))))))))))) 
iii  T A B L E  O F  C O N T E N T S

PAGE 
EXECUTIVE SUMMARY 
INTRODUCTION  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

FINDINGS  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Fifteen States Report Formal Processes from Detoxification to Treatment;

Thirty-two have Informal Processes  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

States Tailor Programs to Complement Their Own Service Delivery Systems  . . . . . . . . . . .  5

States Have Limited Data on Detoxification and Treatment . . . . . . . . . . . . . . . . . . . . . . . . . 8

One-Third of States Conduct Performance Monitoring  . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

States Seldom Use Outpatient Settings for Detoxification  . . . . . . . . . . . . . . . . . . . . . . . . . . 9

RECOMMENDATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  11

COMMENTS ON THE DRAFT REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

ENDNOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

APPENDICES 
A: Data on Program Features and Services  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1

B: Services Linkages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1

C: Types of Care in State Medicaid Programs  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-1

D: Types of Detoxification Services Reimbursed by Medicaid  . . . . . . . . . . . . . . . . . . . . .  D-1

E: Text of HCFA and SAMHSA Comments  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E-1
 I N T R O D U C T I O N

PURPOSE 
To assess whether Medicaid and other State programs provide linkages for patient services 
between substance abuse detoxification and follow-up treatment programs. 
BACKGROUND 
Detoxification and substance abuse treatment are funded federally by the Health Care Financing 
Administration (HCFA) and the Substance Abuse and Mental Health Services Administration 
(SAMHSA).  Annually, the SAMHSA spends over $1.5 billion on substance abuse prevention and 
treatment services.  In addition, HCFA covers substance abuse detoxification and treatment in 
most State Medicaid programs. 
Substance abuse detoxification is the process through which a person who is physically dependent 
on alcohol, illegal drugs, prescription medications, or a combination of these is withdrawn from 
the drugs of dependence.  Detoxification, the vital first step of the rehabilitative process, is 
basically a mere stabilization of physiological functions.  The treatment process or treatment phase 
of substance abuse services is perhaps the most critical determinant of a Medicaid beneficiarys 
success.  Substance abuse and mental health professionals believe that a treatment program should 
be undertaken subsequent to detoxification to assist the beneficiary in making the transition from 
addiction to recovery, to prevent relapses, and promote healthy alternative living skills for 
Medicaid beneficiaries to more effectively deal with their addictions. 
States utilize a combination of Medicaid fee for service and managed care programs in 
administering their inpatient and outpatient detoxification and treatment programs.  Forty States 
still utilize a Medicaid fee for service program to reimburse for substance abuse detoxification 
services.  Ten States have a Section 1915b behavioral health waiver to specifically treat the 
substance abuse population.  Such waivers strictly deal with only a small subset of a States 
Medicaid population.  Also, 28 States currently have a Medicaid managed care program in place 
for substance abuse detoxification services (see Appendix A). 
A review of the SAMHSA Managed Care Tracking System: State Profiles on Public Sector 
Managed Behavioral Healthcare and Other Reforms (July 1997) and various State Alcohol and 
Drug Rehabilitative Services manuals suggests that treatment services are a logical, integrated 
component of a continuum of substance abuse services offered to Medicaid beneficiaries in some 
States.  However, in other States, detoxification services and treatment services are distinctly 
separate programs.  Within these States, Medicaid beneficiaries may not receive substance abuse 
treatment or may not receive such treatment services in a timely manner following discharge from 
a detoxification program. 
Treatment journals such as Psychiatric Services1 and the American Journal of Public Health2 
emphasize the critical importance of substance abusers receiving immediate, follow-up treatment 
services.  If Medicaid beneficiaries are not linked into a treatment program right away, the 
beneficiary may abandon the recovery effort.  For example,  Medicaid beneficiaries often present 
)))))))))))
1  other problems in addition to their dependence on drugs or alcohol.  The Medicaid substance 
abuser may be having difficulties in the areas of employment, and medical and psychiatric health 
as well.  The presence of these factors often complicates the provision of substance abuse 
treatment, and other problems, if left unattended, can provoke a relapse to substance use or abuse 
even among well-motivated, abstinent individuals.  Therefore, the provision of treatment services 
is seen as vitally important both for the purpose of retaining beneficiaries in a treatment program 
and for reducing the risk of a relapse. 
Coordinating continuum of care poses a challenge in the delivery of adequate and appropriate 
substance abuse services to Medicaid beneficiaries.  In addition, States are increasingly relying on 
managed care plans to provide behavioral health services to Medicaid populations which include 
vulnerable beneficiaries who may have special health problems.3  Some States are also attempting 
to carve-out certain populations or services from mainstream managed care plans moving them 
toward other systems of care offering specialized services for individuals with particular 
conditions. 
Provision of Medicaid services by managed care organizations is relatively new in the delivery of 
health care, especially in the field of substance abuse.  To ensure accountability within Medicaid 
managed care contracts and State plans, some States have adopted specific provisions to describe 
substance abuse activities and services which are guaranteed to be provided as a condition of the 
contract or plan.  However, there are no requirements mandated by the Medicaid program on 
continuum of care or linkage from detoxification to treatment. 
METHODOLOGY 
We mailed surveys to each Medicaid State agency to determine whether State Medicaid programs

provide for substance abuse treatment following detoxification programs.  The surveys were

completed by State agency-designated respondents from various disciplines.  Many States

coordinated a comprehensive response by assembling appropriate individuals from the State

Medicaid health care policy division, State department or bureau of alcohol and drug treatment

services, and a managed care division representative.  Follow-up contacts were made with both

Medicaid State agencies and alcohol and drug treatment professionals for the States to clarify

responses and to obtain additional information from the 35 States that initially indicated that they

had no formal continuum of care from detoxification to treatment within their State Medicaid

coverage policies.

We collected information on the following topics:  types of detoxification and treatment programs

reimbursed by Medicaid; settings and staff involved in substance abuse programs; managed care

and Medicaid fee for service; linkage of services from detoxification to treatment; traditional

hospital-based inpatient programs versus outpatient programs; waivers and

carve-out programs; recidivism; admission and treatment data; program expenditures; and

future programmatic concerns.

)))))))))))
2  We asked States whether their substance abuse detoxification programs are provided by a 
Medicaid managed care contract, and if so, whether the contract specifies that treatment follows 
detoxification.  We did not request nor review specific contracts.  We asked States to list and 
define performance indicators that apply to their States detoxification and treatment programs. 
We requested States to identify managed care providers of detoxification and treatment services, 
recidivism data, and Medicaid expenses for various drug categories.  In order to determine types 
of detoxification services reimbursed by the State Medicaid agencies, we had States select 
placement settings based upon the American Society of Addiction Medicine (ASAM) criteria.  We 
obtained information based on the five generally accepted categories of  patient placement criteria 
promoted by ASAM. 
We analyzed information from a compiled survey database to determine whether State Medicaid 
programs, especially those that contract with managed care organizations, have specific 
provisions for detoxification and for follow-up substance abuse treatment.  We also determined if 
they are incorporating substance abuse detoxification and treatment issues into writing their 
managed care contracts.  Since we did not review medical treatment records, we did not draw any 
conclusions regarding quality of care of Medicaid recipients in the States substance abuse 
programs. 
We also conducted onsite visits in two States that offer detoxification services on an outpatient 
basis to obtain in-depth material on their detoxification programs, treatment, and coverage 
policies and processes.  We met with directors of family services, directors of mental health and 
substance abuse departments, Medicaid policy staff, Medicaid program chiefs, managed care 
representatives, and directors of State bureaus of alcohol and drug treatment services. 
We conducted our review in accordance with the Quality Standards for Inspections issued by 
the Presidents Council on Integrity and Efficiency. 
)))))))))))
3  F I N D I N G S

Fifteen States Report Having Formal Processes Providing Transition from Substance Abuse 
Detoxification to Treatment; Thirty-two have Informal Processes 
Fifteen States said they had written language addressing continuum of care in their Medicaid State 
plan, Medicaid managed care contract, States quality assurance plan or within other formal 
agreements among State entities  (See Appendix B).  Ten of the 15 States employ Medicaid 
managed care as part of their substance abuse detoxification programs. 
Since only 15 States initially reported formal linkage or transition policies to assure continuation 
of services from detoxification to treatment, we re-contacted the remaining 35 States to determine 
the level of their coordination efforts.  While only 15 States had formal processes to provide a 
transition for Medicaid beneficiaries in moving from substance abuse detoxification programs to 
treatment services, 32 of the 35 remaining States report having informal processes at various 
levels in local communities to facilitate the transition from detoxification programs to treatment 
programs. 
Detoxification programs often refer Medicaid beneficiaries to available treatment services 
programs in the State.  States report that the referral to treatment programs is primarily made 
before discharge from the detoxification facility.  States also reported that such linkages to 
treatment are immediate if there are treatment center slots available at the time.  Moreover, in 
some States, the treatment is part of a comprehensive plan of care (including both detoxification 
and treatment), and the Medicaid beneficiary is immediately transferred to the appropriate 
treatment program. 
Treatment services can be provided at an inpatient treatment center, a community mental health 
center, a psychiatric center, residential center, or a community based health organization. 
Depending upon the assessment of the Medicaid beneficiary, it may be determined that the person 
should be seen by a psychologist or licensed clinical social worker.  Therefore, a beneficiary might 
see a mental health professional (e.g., a psychologist) in addition to treatment at an outpatient 
clinic. 
Most States have Medicaid covered detoxification and treatment programs (See Appendix C). 
However, in States such as Minnesota and Kansas where Medicaid does not cover substance 
abuse detoxification services, they use a variety of options.  For example, Minnesota counties are 
required to arrange for the provision of detoxification services for anyone who requires them. 
Local funds pay for detoxification services with State funds paying for some transportation costs. 
In Kansas, community-based detoxification services are provided, but are not paid by Medicaid. 
Other funding mechanisms which States utilize for substance abuse services include SAMHSA 
treatment grants, community development block grants, and State general assistance and local 
monies to treat the Medicaid population. 
Also, States without Medicaid-funded detoxification programs coordinate arrangements with 
other entities outside the Medicaid program to facilitate a continuum of care from detoxification 
programs to treatment programs.  This is not an obstacle for Minnesota or Kansas.  In both these 
)))))))))))
4  States, planning for the treatment begins well before the beneficiary completes detoxification. 
Twenty of the 35 States re-contacted mentioned community-based, local, or State-sponsored 
treatment programs available in locations throughout their State.  Two-thirds of these States 
reported timely or immediate linkage to treatment, with no interruption of services.  They 
emphasized that the beneficiary must be compliant, noting that there is nothing they can do to 
change a beneficiarys will or decision to abstain from entering treatment.  However, 7 of the 
32 States having informal detoxification to treatment linkage processes expressed concerns about 
fragmented services in their State, or that their State has had difficulty in the past in coordinating 
a full range of services (from detoxification to treatment). 
States Tailor Substance Abuse Programs to Complement Their Own Service Delivery Systems 
We found that detoxification programs within the States vary widely.  Each have evolved over the 
years into very State-specific oriented activities.  These programs also differ widely in 
composition, with some programmatic changes occurring over the last few years to the States 
current configurations of inpatient and outpatient programs.  There has been a general movement 
towards outpatient settings for substance abuse programs, especially intensive outpatient 
treatment programs.  In addition, some States are moving toward outpatient detoxification 
services, sometimes as part of a managed care initiative.  However, inpatient detoxification 
services are more common. 
State bureaus of alcohol and drug abuse services oversee the coordination of substance abuse 
detoxification and treatment programs within and outside of State Medicaid programs.  Each 
State has developed functional working relationships among various substance abuse treatment 
providers and programs, despite application of different funding sources for programs.  State 
directors of alcohol and drug abuse services choose programs that they believe function optimally 
in their own particular State.  Substance abuse treatment and addiction professionals use 
resources as efficiently as possible, given the constraints of various funding streams and the often 
scattered programs that exist throughout many States. 
Also, State bureaus provide technical assistance to local programs and oversee the delivery of 
diverse treatment programs at urban and rural locations.  Each provide interpretation of level of 
care distinctions, assist substance abuse detoxification and treatment program providers in 
determining approved reimbursement rates for the various levels of care, and may publish 
administrative informational bulletins to clarify State policies and provisions. 
State bureaus may assist treatment programs in determining appropriate level of care settings for 
Medicaid beneficiaries who also have a mental illness.  Each help to ensure that integrated systems 
of care exist for all Medicaid recipients in their State, regardless of a beneficiarys particular 
substance of abuse or co-occurring health or mental health problems.  Bureaus may also become 
involved in transportation and access to services issues, and certification or approval of  certain 
treatment programs reviewed during their on-site visits. 
)))))))))))
5  As noted in Table 1 below, States utilize a variety of treatment settings for their State Medicaid 
detoxification programs.  More than half of the States indicated that both acute care hospitals and 
inpatient psychiatric hospitals are the most common settings. 
Table 1 
TYPES OF TREATMENT SETTINGS 
No. Of Medicaid 
Programs using  Type of Setting of Medicaid 
each setting  Detox Programs 
28  Acute care general hospital 
Psychiatric hospital 
27  inpatient unit 
15  Hospital outpatient department 
15  Hospital emergency room 
10  Addiction treatment facility 
Freestanding detoxification 
9  center 
8  Day hospital program 
6  Freestanding urgent care 
6  Social detoxification program 
3  Clinic 
1  Home health care agency 
1  Regional treatment center 
States vary in their usage of different types of placement criteria in determining which categories 
of Medicaid beneficiaries should receive particular kinds of detoxification services.  The American 
Society of Addiction Medicine (ASAM) has established levels of settings for adult patients in need 
of detoxification.  Thirty-six States said that their substance abuse detoxification setting most 
closely resembles the ASAM category of medically managed intensive inpatient detoxification 
(See Appendix D).  Many of these States utilize other categories of placement settings or a 
mixture of inpatient and outpatient detoxification settings.  Ten States use clinically managed 
residential detoxification.  (See Appendix D, pages D-4 and D-5, for an explanation of the five 
generally accepted categories of patient placement criteria published by ASAM.) 
)))))))))))
6  States identified many types of staff who participate in their States Medicaid detoxification 
programs. While a physician is utilized in 84 percent of the States, Table 2 below identifies 
various medical professionals and social workers who function as participants in the detoxification 
process. 
Table 2 
PARTICIPANTS IN THE DETOXIFICATION PROCESS 
Treatment 
Professionals  # of States 
Physician, not including 
psychiatry  42 States 
Registered nurse  37 States 
Psychiatrist  36 States 
Licensed practical nurse 
(LPN)  30 States 
Psychologist  27 States 
Certified alcohol/drug 
counselor  23 States 
Licensed clinical social 
worker  22 States 
Degreed social worker 
(e.g., MSW)  20 States 
Physician assistant  18 States 
Non-licensed counselor  11 States 
All hospital staff  5 States 
Acupuncturist  3 States 
Another critical distinction among States is the numerous care settings that may exist within their 
Medicaid detoxification programs.  States reported that they commonly use the following 
categories:  inpatient hospitalization - 42 States; outpatient hospitalization - 13 States; clinical 
services - 11 States; and rehabilitation - 9 States. 
Also, some States use multiple categories, and one State indicated it uses all these types of 
categories for Medicaid reimbursement.  This variety among States may hinder the capturing of 
consistently reliable data on detoxification programs. 
)))))))))))
7  States Have Limited Data on Detoxification and Treatment Activity and Outcomes 
We found that States vary in their capturing of quality and performance data, whether reimbursed 
by Medicaid fee for service or part of a managed care program.  Over three-fourths of States 
could not provide data on the average time elapsed for Medicaid beneficiaries from detoxification 
discharge to onset of treatment.  Among 11 States that responded to a question on waiting times 
for Medicaid covered treatment, elapsed waiting time from detoxification to enrollment into a 
treatment program averaged 4.9 days, ranging from 1 to 30 days. 
Of the 28 States with managed care programs, 23 States responded they did not know whether 
managed care substance abuse detoxification services are less costly than providing these services 
through Medicaid fee for service.  Only 5 of the 28 States said that Medicaid managed care for 
substance abuse detoxification is less costly than Medicaid fee for service. 
Some respondents said that detoxification programs are expected to refer Medicaid beneficiaries 
to treatment, but no one oversees or collects data on this function. We also heard that 
detoxification programs are indeed referring Medicaid beneficiaries to available treatment 
programs, but it is up to the beneficiary to oversee their individual recovery.  Only 16 States 
reported that they have case management to monitor a beneficiarys progress.  Twelve of those 16 
States had managed care programs  (See Appendix A). 
Only 15 States were able to provide information on Medicaid expenditures for detoxification for 
fiscal year 1996.  Some States did not have management information systems to break out 
admission data by drug, and only two States had information on numbers of Medicaid 
beneficiaries who were admitted for detoxification and subsequently enrolled into a treatment 
program. 
States which do not capture information on continuum of care linkages have little basis to assess 
whether beneficiaries are receiving timely treatment services, or even if the initial referral was 
adhered to or heeded.  As a result, State departments or bureaus of substance abuse services may 
be unaware of the overall effectiveness of their substance abuse program services. 
Only seven States reported recidivism data.  The average recidivism rate was 47 percent covering 
a range of 23 percent to 93 percent (23%, 27%, 28%, 40%, 50%, 70%, and 93% were the 
responses from the 7 States) of Medicaid beneficiaries readmitted for detoxification services 
within one year.  This figure from the seven States is consistent with information from the 1997 
Drug Abuse Treatment Outcomes Study commissioned by the National Institute of Drug Abuse 
which found that between 40 to 50 percent of beneficiaries entering drug treatment have prior 
treatment experience.  Five of the seven States reported the following breakout of known 
recidivism rates by episodic categories: 
!  45 percent of beneficiaries were readmitted 1 - 2 times 
!  17 percent of beneficiaries were readmitted 3 - 5 times 
!  15 percent of beneficiaries were readmitted more than 5 times 
)))))))))))
8  One-Third of States Conduct Performance Monitoring of Substance Abuse Programs 
Survey responses indicate that 16 States conduct quality assurance performance oversight efforts. 

These include case record reviews and site visits by the States departments or bureaus of alcohol

and drug abuse programs.  Also, some of the managed care programs have their own performance

requirements listed in their quality assurance plans.  These performance requirements may include

engaging beneficiaries in the treatment process after being discharged from inpatient

detoxification, reducing recidivism rates of beneficiaries, and increasing the number of Medicaid

beneficiaries served.

States which have performance indicators are able to demonstrate results in several areas.  Some

of these areas include:  beneficiaries are abstinent/drug-free at termination of the program;

reduction of use of the primary abuse substance; referral to alcohol and drug treatment or

continued treatment; employability improvement or academic improvement of beneficiaries;

beneficiaries are not being arrested during treatment or not driving under the influence;

pregnant women abstinent 30 days before delivery; and beneficiaries are experiencing continued

abstinence at regularly-checked intervals (e.g., one month, three months, six months, one year). 

States with performance requirements have sobriety maintenance goals to monitor beneficiaries

continued periods of abstinence or reduction of drug use.  In addition, two States have specific

programs and another two States are implementing programs to follow pregnant and post-partum

women through their rehabilitation. 

States Seldom Use Outpatient Settings for Detoxification Services 
Some States appear to be limited by what they can provide under Medicaid reimbursement 
provisions.  For example, a State Medicaid agency may historically reimburse only for inpatient 
detoxification.  Geographical considerations also influence the delivery of detoxification and 
treatment services.  Two States report having large outlying rural areas where managed care is 
neither practical nor cost-feasible.  In these States, Medicaid fee for service may be used for 
substance abuse services or in distinct geographic areas only.  In addition, a State may only offer 
Medicaid detoxification to adults under emergency circumstances.  Other States use the inpatient 
detoxification component primarily for acute cases, and some offer inpatient detoxification in 
exceptional circumstances, such as the Medicaid beneficiary who has an accompanying illness or 
is pregnant.  Nearly all (44 States) offer some form of Medicaid inpatient care for detoxification. 
According to analysis of State responses, only five States (Georgia, Maryland, Massachusetts, 
South Carolina and Vermont) have moved from a primarily hospital-based (i.e., inpatient) 
detoxification program to State detoxification programs where outpatient detoxification is a 
standard choice.  Another 10 States utilize outpatient detoxification on an alternative or less 
extensive basis.  However, each State continues to offer Medicaid inpatient detoxification services 
when medical conditions require a medically-managed or medically-monitored inpatient 
detoxification. 
)))))))))))
9  Maryland and Vermont have covered outpatient detoxification services for Medicaid recipients for 
15-20 years.  Massachusetts moved to managed care programs about six years ago, opening up 
many different types of detoxification alternatives, including various outpatient programs. 
Georgia has offered outpatient detoxification services provided by Community Mental Health 
Centers for the past four years, with their State mental hospitals discontinuing inpatient 
detoxification treatment in 1994.  However, inpatient detoxification is still available in acute care 
hospitals when conditions warrant.  South Carolina began offering outpatient detoxification 
services in 1997. 
Forty States cover Medicaid outpatient substance abuse treatment compared to 33 States that 
cover Medicaid inpatient treatment.  Half of the States cover both inpatient and outpatient 
treatment programs.  In three States, Medicaid does not pay for substance abuse treatment 
services except through the Early Periodic and Screening Diagnosis and Treatment program for 
children under the age of 21.  Also, a few States provide inpatient treatment only when the 
Medicaid beneficiary presents a co-occurring psychiatric illness or diagnosis; otherwise, an 
outpatient setting is appropriate for the remaining Medicaid beneficiaries. 
)))))))))))
10  R E C O M M E N D A T I O N

Whether in established programs covered by Medicaid, Federal grants, or State and local funding, 
States find it very difficult to capture extensive information in the areas of treatment completion, 
linkage from detoxification to treatment, sobriety maintenance, and recidivism.  This is 
particularly apparent with substance abuse beneficiaries who move to and from programs and are 
not required to report progress in their recovery or lack of recovery.  Therefore, to bridge the 
gaps in performance information and to enhance cost effective detoxification and treatment, we 
recommend that: 
SAMHSA and HCFA Should Work With States to Develop Appropriate Performance 
Measures 
The SAMHSA should work with State agencies to develop performance indicators that measure 
linkages from substance abuse detoxification to treatment.  We believe this will help ensure that 
linkages and coordination are a priority for improvement, and that Medicaid beneficiaries are not 
merely engaging in detoxification without treatment. 
The SAMHSA and HCFA should collaborate and encourage State Medicaid agencies to include 
language regarding continuity of substance abuse services in their managed care contracts. 
The SAMHSA and HCFA also should work with States to facilitate enhanced data collection on 
the continuum of care.  Such treatment and outcome data are essential to capture information on 
what is occurring in the treatment field.  This will enable reasonable conclusions to be drawn to 
enhance the quality of existing programs. 
AGENCY COMMENTS 
We received comments on the draft report from HCFA and SAMHSA.  The full text of their 
comments is included in Appendix E. 
Both HCFA and SAMHSA concurred with our recommendation but emphasized they cannot 
ensure that States meet goals and provide treatment and outcome data.  However, they expressed 
a willingness to work with States in these efforts and toward greater continuity for treatment care 
following detoxification services. 
The SAMHSA also suggested exploring mechanisms for shifting to greater use of outpatient 
detoxification services which have been shown to be as safe and effective as, and more cost 
efficient than, inpatient detoxification.  We agree this issue is important and warrants further 
examination.  However, while our report contains a finding on the uneven use of this service 
among the States, our study was not sufficient to draw conclusions on outpatient detoxification 
safety and efficiency. 
)))))))))))
11  E N D N O T E S

1"Outcome of Patients in A Veterans Affairs Ambulatory Detoxification Program, Psychiatric 
Services, February 1997 (Vol. 48, No. 2), pp. 200 - 203. 
2"Alcohol and Drug Use, Abuse, and Dependence among Welfare Recipients, American Journal 
of Public Health, October 1996 (Vol. 86, No. 10), pp. 1450 - 1454. 
3"Negotiating the New Health Care System: An Analysis of Contracts between State Medicaid 
Agencies and Managed Care Organizations,  Center for Health Policy Research and the Center 
for Health Care Strategies.   Center for Health Policy Research, George Washington University, 
February 1997. 
)))))))))))
12  APPENDIX A

STATES WITH SUBSTANCE ABUSE MANAGED CARE

DETOXIFICATION PROGRAMS HAVE LIMITED DATA

ON FEATURES AND SERVICES

)))))))))))
A - 1  STATES WITH SUBSTANCE ABUSE MANAGED CARE

DETOXIFICATION PROGRAMS HAVE LIMITED DATA

ON FEATURES AND SERVICES

Managed  Use  Patient  Case  Have  Capture 
Care  Performance  Placement  Mgt.  Follow-up/  Recidivism 
States  Indicators  Criteria  Svcs.  Aftercare  Data 
Arizona  X  X  X  X 
Colorado 
Connecticut 
Delaware  X 
Georgia  X 
Hawaii  X  X 
Illinois  X 
Iowa  X  X  X  X 
Maryland  X  X  X  X 
Massachusetts  X  X  X  X 
Missouri  X 
Nebraska  X 
Nevada  X 
N. Hampshire  X 
New Mexico  X  X 
New York  X  X  X 
No. Dakota  X 
Ohio 
Oklahoma 
Pennsylvania 
R. Island  X 
So. Carolina  X 
So. Dakota 
Tennessee  X  X  X 
Texas  X  X  X  X 
Utah 
Vermont  X  X 
Wisconsin  X  X 
TOTALS  11  11  12  6  4 
)))))))))))
A - 2  A P P E N D I X  B

LINKAGES AND CONTINUUM OF CARE

ARRANGEMENTS OF STATES

)))))))))))
B - 1  LINKAGES AND CONTINUUM OF CARE

ARRANGEMENTS OF STATES

Basis for Linkage  States 
Within the States Medicaid Plan for services  Missouri* 
Expressly written in the Medicaid managed  Maryland* 
care contract  Ohio* 
Oregon 
Rhode Island* 
South Carolina* 
Within a quality assurance plan mandated by  Arizona* 
the managed care contract  Illinois* 
Massachusetts* 
Within the States general quality integrity or  Alaska 
quality assurance plan  Illinois (also within contracts quality plan) 
Maine 
South Carolina (also in managed care plan) 
Wyoming 
Utilization management contractor ensures  Florida 
link between hospitals and State substance 
abuse/mental health authorities 
Linkage of services is assured by the Division  Georgia* 
of Mental Health, Mental Retardation, and 
Substance Abuse Standards 
The Behavioral Health Organizations are  Tennessee* 
required to provide medically necessary 
services 
* States with Medicaid Managed Care detoxification programs. 
)))))))))))
B - 2  A P P E N D I X  C

MEDICAID LEVELS OF CARE COVERING

DETOXIFICATION AND

TREATMENT PROGRAMS BY STATE

)))))))))))
C - 1  MEDICAID LEVELS OF CARE COVERING DETOXIFICATION

AND TREATMENT PROGRAMS BY STATE

Linkage of Detox  Managed Care 
Medicaid I/P Detox  Medicaid O/P  Medicaid I/P  Medicaid O/P  Medicaid Managed  to Treatment within  Detox Services Less 
STATES 
Detox  Treatment  Treatment  Care Detox  Medicaid  Costly than FFS 
ALABAMA  X  X 
ALASKA  X  X  X  X  X 
ARIZONA  X  X  X  X 
ARKANSAS  X  X 
CALIFORNIA  X  X 
COLORADO  X  X  X  X  X 
CONNECTICUT  X  X  X  X  X 
DELAWARE  X  X  X 
FLORIDA  X  X  X 
GEORGIA  X  X  X  X  X  X 
HAWAII  X  X  X  X  X 
IDAHO  X  X  X 
ILLINOIS  X  X  X  X  X 
INDIANA  X  X  X 
IOWA  X  X  X  X  X 
KANSAS  X 
KENTUCKY 
LOUISIANA  X  X 
)))))))))))
C - 2
 Linkage of Detox  Managed Care 
Medicaid I/P  Medicaid O/P  Medicaid I/P  Medicaid O/P  Medicaid Managed  to Treatment within  Detox Services Less 
Detox  Detox  Treatment  Treatment  Care Detox  Medicaid  Costly than FFS 
STATES 
MAINE  X  X  X  X  X 
MARYLAND  X  X  X  X  X 
MASSACHUSETTS  X  X  X  X  X  X  X 
MICHIGAN  X  X 
MINNESOTA  X 
MISSISSIPPI  X  X 
MISSOURI  X  X  X  X  X 
MONTANA  X  X 
NEBRASKA  X  X  X  X 
NEVADA  X  X  X 
NEW HAMPSHIRE  X  X  X  X 
NEW JERSEY  X  X  X  X  X 
NEW MEXICO  X  X  X 
NEW YORK  X  X  X  X 
N. CAROLINA  X  X 
N. DAKOTA  X  X  X 
OHIO  X  X  X  X  X 
OKLAHOMA  X  X  X  X 
OREGON  X  X 
PENNSYLVANIA  X  X  X  X 
RHODE ISLAND  X  X  X  X  X  X 
S. CAROLINA  X  X  X  X  X  X 
)))))))))))
C - 3
 S. DAKOTA  X  X  X 
Linkage of Detox  Managed Care 
Medicaid I/P  Medicaid O/P  Medicaid I/P  Medicaid O/P  Medicaid Managed  to Treatment within  Detox Services Less 
STATES  Detox  Detox  Treatment  Treatment  Care Detox  Medicaid  Costly than FFS 
TENNESSEE  X  X  X  X  X  X 
TEXAS  X  X  X  X  X 
UTAH  X  X  X 
VERMONT  X  X  X  X  X 
VIRGINIA 
WASHINGTON  X  X  X 
W. VIRGINIA  X  X  X 
WISCONSIN  X  X  X  X 
WYOMING  X  X  X 
TOTALS  44  15  33  40  28  15  5 
)))))))))))
C - 4
 A P P E N D I X  D

TYPES OF DETOXIFICATION SERVICES REIMBURSED 
BY STATE MEDICAID PROGRAMS 
(using American Society of Addiction Medicine categories) 
))))))))))) 
D - 1  TYPES OF DETOXIFICATION SERVICES1 REIMBURSED 
BY STATE MEDICAID PROGRAMS 
Other kinds of 
O/P Detox  O/P Detox w/  Clinically  Medically  Medicaid-
w/o extended  extended  managed  Medically  managed  reimbursed 
onsite  onsite  Residential  monitored I/P  intensive I/P  Detox 
STATES  monitoring  monitoring  Detox  Detox  Detox  programs 
ALABAMA  X 
ALASKA  X  X 
ARIZONA  X  X2 
ARKANSAS  X  X  X3 
CALIFORNIA  X 
COLORADO  X 
CONNECTICUT  X  X  X  X  X4 
DELAWARE  X  X  X  X  X  X5 
FLORIDA  X 
GEORGIA  X  X  X 
HAWAII  X  X 
IDAHO  X 
ILLINOIS  X 
INDIANA  X  X  X 
IOWA  X  X 
KANSAS 
KENTUCKY 
LOUISIANA  X 
MAINE  X  X 
MARYLAND  X  X  X 
MASSACHUSETTS  X  X  X  X 
MICHIGAN  X 
MINNESOTA 
MISSISSIPPI  X 
MISSOURI  X  X 
MONTANA  X6 
NEBRASKA  X 
NEVADA  X 
NEW HAMPSHIRE  X 
NEW JERSEY  X  X 
NEW MEXICO  X  X 
))))))))))) 
D - 2
 Other kinds of 
O/P Detox  O/P Detox w/  Clinically  Medically  Medicaid-
w/o extended  extended  managed  Medically  managed  reimbursed 
onsite  onsite  Residential  monitored I/P  intensive I/P  Detox 
monitoring  monitoring  Detox  Detox  Detox  programs 
STATES 
NEW YORK  X  X 
N. CAROLINA  X  X7 
N. DAKOTA  X  X 
OHIO  X  X 
OKLAHOMA  X 
OREGON  X 
PENNSYLVANIA  X  X  X 
RHODE ISLAND  X  X  X  X 
S. CAROLINA  X  X  X  X  X 
S. DAKOTA  X 
TENNESSEE  X8 
TEXAS  X  X 
UTAH  X 
VERMONT  X  X  X  X  X 
VIRGINIA 
WASHINGTON  X 
W. VIRGINIA  X  X 
WISCONSIN  X 
WYOMING 
TOTALS  10  10  10  19  36  7 others 
1  American Society of Addiction Medicine categories of services, as identified in pages D-4 and D-5. 
2  Medically necessary inpatient detoxification in an acute care general hospital. 
3  Rehabilitative services for persons with mental illness. 
4  Community clinics. 
5  Delaware has outpatient detox w/o monitoring; outpatient detox w/ monitoring; clinically-managed detox; 
and medically-monitored detox through managed care only. Medically-managed intensive inpatient 
detoxification is through both Medicaid fee for service and Medicaid managed care. 
6  Inpatient hospital four-day detoxification. 
7  Outpatient services such as intensive outpatient and day hospital are reimbursed when provided through 
a community mental health center. 
8  The Medicaid (Tenncare) program does not directly reimburse for any detox service. The behavioral health 
organizations have the latitude to reimburse for any service they choose. 
))))))))))) 
D - 3  ))))))))))) 
D - 4
 ))))))))))) 
D - 5
 A P P E N D I X  E

AGENCY COMMENTS 
HEALTH CARE FINANCING ADMINISTRATION 
SUBSTANCE ABUSE AND MENTAL HEALTH SERVICES 
ADMINISTRATION 
))))))))))) 
E - 1  ))))))))))) 
E - 2
 ))))))))))) 
E - 3
 ))))))))))) 
E - 4
 ))))))))))) 
E - 5
 ))))))))))) 
E - 6