Program Directors' Views of the Effect of Managed Care on Substance Abuse Programs in Los Angeles County

OBJECTIVE: This study sought information about the effect of managed care on substance abuse treatment programs through a survey of program directors. METHODS: Fifty program directors who supervised a total of 134 substance abuse treatment programs in Los Angeles County completed a survey during the period from January to May 1997 on program changes made in response to managed care, major concerns, the advantages and disadvantages of managed care, and plans for further program changes to succeed in the managed care environment. RESULTS: Program directors reported that the most frequent change made in response to managed care was increased outreach and marketing. Their greatest concern in the managed care environment was being forced to provide the least costly service, rather than the best care for patients. Respondents identified an increased focus on outcomes as an advantage of managed care and restrictions on services due to contractual agreements as a disadvantage. Planned program changes addressed the areas of program structure, types of programs offered, staff composition, revenue generation, referral sources, prevention, outcome measures, relationships with other organizations, and accreditation and certification. CONCLUSIONS: Although some substance abuse treatment programs seem to be reducing their scope or preparing to close in response to managed care, others are developing strategies to survive and even thrive in this new economic environment.