for Mental Health, Substance Abuse Treatment Increases
By Rebecca A. Clay
Over the last decade, the mental health and substance
abuse field has seen a shift in spending away from inpatient
care and toward outpatient care. The field has seen much
greater spending on prescription medication. And the
Government's share of total spending has increased significantly.
These findings are highlights from a new report, National
Expenditures for Mental Health Services and Substance
Abuse Treatment, 1991-2001. Presented by SAMHSA's
Center for Substance Abuse Treatment (CSAT) and Center
for Mental Health Services (CMHS), the report tracks
trends in national spending on mental health services
and substance abuse treatment between 1991 and 2001.
The report provides spending estimates on direct treatment
but not on the social costs of substance abuse and mental
illness, such as their effect on productivity and link
"This report provides a bird's-eye view of mental
health and substance abuse spending," said SAMHSA
Administrator Charles G. Curie, M.A., A.C.S.W., noting
that mental health services accounted for 6 percent and
substance abuse 1 percent of the almost $1.4 trillion
spent on health care overall in 2001.
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The report identifies several major trends:
Spending increases. Spending on
mental health and substance abuse treatment is growing,
with expenditures increasing by nearly 6 percent
a year between 1991 and 2001. All health care spending
grew even faster, approaching 7 percent.
Medication's growing importance. Between
1991 and 2001, several new medications for mental
disorders became available, more people started taking
these medications, and prices went up. In 1991, for
example, prescription drugs represented 1 of every
14 dollars spent on mental health. A decade later,
such drugs represented 1 of every 5 dollars. Antidepressants
accounted for more than half of these drug expenditures
and antipsychotics nearly a quarter.
Decline in inpatient treatment.
As a share of total spending, inpatient expendituresespecially
those for psychiatric hospitalsdeclined over
the decade. The same trend occurred in the substance
abuse field. In 1991, for example, 46 percent of
substance abuse treatment spending went to inpatient
care. By 2001, that percentage had dropped to 30
Shift to public spending. An increasing
share of the payment for mental health and substance
abuse treatment comes from public sources such as
local, state, and Federal governments. "It's
clear the public sector is now the major financial
driver," said Mr. Curie. Public financing of
mental health services and substance abuse treatment
grew from 58 percent of total spending for those
services in 1991 to 65 percent in 2001.
The growth of public financing was even more pronounced
in substance abuse treatment, where it jumped from 62
percent of total substance abuse treatment spending in
1991 to a whopping 76 percent in 2001. While private
insurance payments for health care overall grew at a
rate of almost 7 percent annually, private insurance
payments for substance abuse treatment dropped by 1 percent
Dominance of Medicaid. Medicaid
is playing an increasingly prominent role. For mental
health services, for example, Medicaid spending is
growing faster than that of any other payer. As a
result, it has become the Nation's largest payer
of mental health services.
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A Crucial Resource
Who uses this information?
"The target audience is anybody who's concerned
with health care spending trendspolicymakers, researchers,
treatment providers, advocates, and the like," explained
Jeffrey A. Buck, Ph.D., one of the report's co-authors
and the Associate Director for Organization and Financing
at CMHS. "We've already established these reports
as the primary source for people to find out what's happening
with mental health and substance abuse spending in the
The report's popularity derives from its comprehensiveness,
added Rita Vandivort, M.S.W., another of the report's
co-authors, the project officer, and a public health
analyst in the Division of Services Improvement at CSAT.
"There's really no other report on mental health
and substance abuse services that is comprehensive across
all public and private payers like this expenditure study
is," she explained. "It provides a benchmark
for looking at where we are and how spending for services
is changing." Readers can also compare the report
to the National Health Accounts from the Centers for
Medicare & Medicaid Services, which reports spending
on all health services.
SAMHSA produces these spending reports periodically.
But because each report takes advantage of better data
sources and improved methods, it's unwise to compare
spending estimates in one report to those published in
"Every time we do one of these reports, we go back
and re-estimate the values for previous years,"
said Dr. Buck. "Whenever one of these new reports
comes out, you should replace your old report with the
For a copy of the full report, visit www.samhsa.gov/
spendingestimates/toc.aspx or call SAMHSA's
National Clearinghouse for Alcohol and Drug Information
at 1 (800) 729-6686.
Distribution of Mental Health Services and Substance
Abuse Treatment Expenditures by Payer, 2001
Mental Health and Substance Abuse
Treatment = $103.7 billion
Source: SAMHSA. National Estimates of Expenditures
for Mental Health Services and Substance Abuse Treatment:
1991-2001 (page 10).
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