DoubleTree Hotel
Rockville, Maryland
April 7, 1998

William S. Cartwright, Ph.D.
Economist
Services Research Branch
Division of Clinical and Services Research

Summary

Meeting Goals

• Convene experts in economics and health services research to address the current state of the science and the future direction for NIDA’s Economics Research Program
• Discuss the areas of cost-benefit and cost-effectiveness analysis, financing, managed care and alternative delivery systems, and the cost and production of treatment
• Identify priorities and new initiatives in each of the above areas
• Determine specific agenda items for the NIDA meeting, Forging the Link: Health Services Research on Drug Abuse Prevention and Treatment, that will be held in conjunction with the Annual Meeting of the Association for Health Services Research in June 1998

Meeting Process

The meeting was chaired by Gary Zarkin, Ph.D. Following introductions and overviews by Bennett Fletcher, Ph.D., Dr. Cartwright, and Dr. Zarkin, four discussion sessions were held on the following topics:

• Cost and Production of Drug Treatment Services, led by Michael French, Ph.D.
• Cost-Benefit and Cost-Effectiveness Analysis, led by Dr. Zarkin
• Financing of Drug Treatment and Prevention Services, led by Paul Solano, Ph.D.
• Managed Care and Alternative Delivery Systems, led by Deborah Garnick, Ph.D.

Content

Cost and Production of Drug Treatment Services

• Improve consistency and standardization in cost estimation methods
• Develop clear descriptions about the methods and data sources for cost estimation
• Provide distinctions between cost estimation for evaluation purposes and cost estimation for billing and reimbursement
• Recommendations:
• Opportunities exist for linking cost estimates with diagnostic and clinical information.
• Cost estimation is often the easiest activity for younger economists to make the transition into substance abuse research.

Cost-Effectiveness and Cost-Benefit Analysis

• Improve benefit valuation methods by expanding work on willingness-to-pay models, estimation of quality-adjusted life years, and other benefit measures (i.e., need to expand beyond cost-offset models)
• Incorporate the role of uncertainty in cost, cost-effectiveness, and cost-benefit analysis
• Develop Markov and other dynamic models to capture the chronic nature of drug addiction and treatment
• Incorporate dynamic models of disease and treatment progression into economic models
• Estimate the effectiveness and cost-effectiveness of discrete treatment services or service bundles
• Expand research on the economic viability of outreach and brief intervention of at-risk substance abusers
• Expand economic data collection in randomized clinical trials

Financing

• Bifurcated financing system composed of:
• Private health insurance (and out-of-pocket expenditures)
• Public sector financing, including block grants and Medicaid
• Benefit design issues
• Carve-outs and risk contracting
• Risk sharing
• Risk adjustment
• Reinsurance
• Performance contracting and outcomes

Managed Care and Alternative Delivery Systems

• Facets of managed care/insurance
• Payer
• Employers
• Medicaid
• Managed care organization
• Vendor
• Provider
• Others
• Employee Assistance Programs
• Public service delivery system
• Financial aspects
• Incentives
• Controls
• Payments
• Issues
• Data quality/availability
• Contractual details
• Shifting relationships among organizations
• Changing enrollment by patients

Follow-Up

• Two panels will be formed for the NIDA-sponsored meeting, Forging the Link: Health Services Research on Drug Abuse Prevention and Treatment, to be held in conjunction with the Annual Meeting of the Association for Health Services Research in June 1998. Individuals will be selected to present economic issues in the following areas:
• State of the science
• Future research directions