The loss of insurance benefits is associated with restricted access to care, decrements in beneficiary functioning, and closure of drug abuse treatment centers (Fuller et al., 2006; Deck et al., 2006).
In 2003, as a response to substantial budget deficits, Oregons Legislature eliminated Medicaid benefits for recipients of outpatient alcohol, drug, and mental health treatment under the Oregon Health Plan Standard plan. Analyses of the policy change suggest a number of negative consequences.
- Approximately 100,000 women and men lost coverage under the OHP-Standard health plan.
- Impacts were especially apparent among individuals diagnosed with opiate dependence. The probability of admission to a methadone treatment program declined 60% in the year following the elimination of benefits; access was reduced most for homeless, young men, without a history of prior treatment (Deck et al., 2006).
- A prospective assessment suggested that 65% of the 3,000 OHP-Standard beneficiaries enrolled in methadone treatment left care and reported immediate increases in drug use, legal, medical, psychiatric, and employment problems (Fuller, et al., 2006).
- Qualitative interviews with treatment providers found that two methadone clinics were closed and other clinics laid off staff, reduced hours, and reduced health benefits; the net effect was a statewide reduction in access to methadone services for all patients including those with insurance resources or able to self-pay (Deck et al., 2006).
- Outpatient mental health and substance abuse benefits were restored in August 2004. The number of OHP-Standard beneficiaries, however, had declined to about 25,000 and new enrollments were not permitted.
- An analysis of Medicaid expenditures found substantial increase in medical care expenses among individuals who had been receiving substance abuse treatment prior to the elimination of the benefit and implies that elimination of the addiction treatment benefit contributed to the increased medical costs (McConnell et al., 2008).