1. SHOVELING UP II: THE
IMPACT OF SUBSTANCE
ABUSE ON FEDERAL,
STATE AND LOCAL
BUDGETS
A Report by
CASAColumbia®
May 2009

2. Purpose of Study
• Update CASAColumbia’s 2001 report Shoveling Up: The Impact of
Substance Abuse on State Budgets
• Expand analysis to federal and local governments
• Differentiate spending by:
 The burden to public programs (crime, illness, social ills)
 The familiar categories of spending (prevention/treatment/research,
taxation/regulation, interdiction)
• Show promising practices for cost-effective investments
© CASAColumbia 2013
2

3. Advisory Panel
•
Frederick M. Bohen, Chairman, The Rockefeller University (retired)
•
Hon. Jeffrion L. Aubry, NYS Assemblyman, 35th Assembly District
•
Tom Cochran, US Conference of Mayors (Ed Somers, alternate)
•
Timothy P. Condon, PhD, National Institute on Drug Abuse (federal liaison)
•
Cabell Cropper, National Criminal Justice Association
•
Ester Fuchs, PhD, Columbia University, School of International and Public Affairs
•
Lewis E. Gallant, PhD, National Association of State Alcohol and Drug Abuse
Directors (retired)
•
Kristine Gebbie, DrPH, RN, School of Nursing, Hunter College, City University of
New York
© CASAColumbia 2013
3

4. Advisory Panel, cont.
•
Peter A. Harkness, Governing Magazine
•
Nolan E. Jones, PhD, National Governors Association (retired)
•
Larry Naake, National Association of Counties (Jackie Byers, alternate)
•
Scott Pattison, National Association of State Budget Officers
•
William T. Pound, National Conference of State Legislatures
•
Dorothy P. Rice, ScD, University of California, Institute on Health and Aging (retired)
•
Don Stapley, Maricopa County Board of Supervisors
•
Julie Boatright Wilson, PhD, Harvard University, John F. Kennedy School of
Government
© CASAColumbia 2013
4

5. Methodology
• Analyzed federal budget
• Surveyed states, DC and Puerto Rico; 47 respondents
• Analyzed total local expenditures (U.S. Census data)
• Case studies of a city government (Nashville,TN), a county
government (Multnomah,OR) and combined city-county
governments (Charlotte and Mecklenburg Co., NC)
• Reviewed > 900 articles/publications
© CASAColumbia 2013
5

6. Federal, state and local governments spent
$467.7 billion in 2005
on substance abuse and addiction,
10.7 % of total spending
© CASAColumbia 2013
6

7. Spending on Substance Abuse
and Addiction (2005)
• Federal: $238.2 billion (9.6% of budget)
• State: $135.8 billion (15.7% of budget)
• Local: $93.8 billion (9.0% of budget)
© CASAColumbia 2013
7

8. Coping With the Consequences
95.6% of Federal and State Substance-Related
Spending Is on the Burden to Public Programs
•
•
•
•
•
•
•
•
•
•
•
© CASAColumbia 2013
Adult Corrections
Juvenile Justice
Courts
Health Care
Elementary and Secondary Education
Income Support
Child Welfare
Mental Health
Developmental Disabilities
Public Safety
Workforce
8

9. Little Spent on
Prevention/Treatment
4.4% of Federal and State Substance-Related Spending
Is in the Familiar Categories of:
•
•
Treatment
•
Research
•
Regulation and Compliance
•
© CASAColumbia 2013
Prevention
Interdiction
9

10. The Substance Abuse/Addiction
Dollar
Of every Federal and State $ spent in 2005:
Research
0.4 cents
Prevention/Treatment
1.9 cents
Regulation/Compliance
1.4 cents
Interdiction
0.7 cents
Burden to Public
Programs
95.6 cents
Of every dollar federal and state governments spent on prevention and treatment, they spent $59.83 in public
programs shoveling up the wreckage of alcohol, tobacco and other drugs--despite evidence of cost-effective sciencebased interventions.
© CASAColumbia 2013
10

11. Conservative Estimates
•
Examples of costs unavailable due to data limits:
 Higher education
 Tobacco/drug-related developmental disabilities
 Drug-related highway accidents
 Civil court costs
 Many local government costs
© CASAColumbia 2013
11

12. Total Spending
If spending on substance abuse and addiction were its
own budget category:
• It would rank 2nd at the state level, behind elementary and
secondary education
• It would rank 6th at the federal level, behind social security, national
defense, income security, Medicare and other health programs
including the federal share of Medicaid
© CASAColumbia 2013
12

13. Spending just on the burden of
substance abuse and addiction takes
at least $1,486 each year from every
man, woman and child in America-$5,944 from a family of four
© CASAColumbia 2013
13

14. Greatest Burden in Two Areas
Of Federal and State 2005
Burden Spending of $357.4 billion,
71.1% Is in Health Care and Justice System Costs
• 58.0% of burden is in health care costs – substance abuse and
addiction that cause or contribute to more than 70 other diseases
requiring hospitalization
• 13.1% of burden is in justice system costs – substance abuse that
drives crime, incarceration and recidivism
© CASAColumbia 2013
14

15. Federal Burden Spending
Burden of Substance Abuse and Addiction on
Federal Programs by Budget Sector (Percent)
Total = $229.9 Billion
Mental Health/
Developmental
Disabilities
1.6
Public Safety
3.3
Federal
Workforce
0.4
Justice
System
2.4
Child/Family
Assistance
16.0
Education
2.4
Health Care
74.1
© CASAColumbia 2013
15

16. State Burden Spending
Burden of Substance Abuse and Addiction on
State Programs by Budget Sector (Percent)
Total = $127.5 Billion
Mental Health/
Developmental
Disabilities
6.4
Child/Family
Assistance
7.8
Public Safety
1.4
Federal
Workforce
0.5
Justice
System
32.5
Education
22.4
Health Care
29.0
© CASAColumbia 2013
16

17. Local Burden Spending
Burden of Substance Abuse and Addiction on
Local Programs by Budget Sector (Percent)
Total = $93.3 Billion
Public Safety
13.7
Local
Workforce
1.5
Justice
System
29.2
Child/Family
Assistance
8.2
Education
24.4%
Health Care
23.0
© CASAColumbia 2013
17

18. Federal and State Burden
Spending (2005)
Health Care
Justice System
Child/Family Assistance
Education
Mental Health/DD
Public Safety
Workforce
TOTAL
© CASAColumbia 2013
($ millions)
207,222
46,977
46,696
33,896
11,772
9,303
1,568
357,433
18

19. Other Federal and State
Spending (2005)
Little Spent in Familiar Substance Abuse
and Addiction Categories:
Prevention and Treatment
($ millions)
7,173
Research
1,604
Regulation and Compliance
5,066
Interdiction
2,638
TOTAL
© CASAColumbia 2013
16,481
19

20. Sin Taxes Don’t Pay Their Way
For each $ federal and state governments collect in alcohol and
tobacco taxes and liquor store revenues, they spend $8.95 shoveling
up the consequences
• The public health goal of tobacco taxes: eliminate use
• The public health goal of alcohol taxes: limit underage and adult
excessive drinking
© CASAColumbia 2013
20

21. For Every $100 Spent
On Substance Abuse and Addiction
Government
Prevention, Treatment
and Research
Federal
$ 2.33
State Average
$ 2.38
Wide Variation:
Connecticut
$10.39
Kentucky
Hawaii
$ 7.32
$ 0.55
New Hampshire
$ 0.22
© CASAColumbia 2013
21

22. RECOMMENDATIONS
• Prevention
• Treatment/Disease Management
• Taxation and Regulation
• Research
© CASAColumbia 2013
22

23. Prevent It!
• Public health information campaign
• Comprehensive messages and programs aimed at children
• Screenings, brief interventions and treatment referrals
© CASAColumbia 2013
23

24. Treat It!
• Comprehensive assessments
• Behavioral and pharmacological treatments
• Treatments for co-occurring disorders
• Long term disease management
• Drug treatment alternatives to prison and prison-based treatment
and aftercare
• Health insurance coverage for addiction prevention and treatments
© CASAColumbia 2013
24

25. Control It!
• Alcohol and tobacco tax increases
• Indoor smoking bans and tobacco quit lines
• Increased enforcement to limit youth access to tobacco and alcohol
© CASAColumbia 2013
25

26. Understand It!
• Increased genetic, biological and behavioral research
• Best practices
• Cost/benefit studies
© CASAColumbia 2013
26

27. Addiction is a disease that should be prevented
and treated--rather than waiting for the disease
to advance, cause enormous human suffering
and drive up health care, corrections and other
social costs
© CASAColumbia 2013
27

28. Ending Addiction
Changes Everything
www.casacolumbia.org
© CASAColumbia 2013

29. Speaker Notes
Slide 1:
•
This is the first study ever conducted documenting the costs of substance abuse and addiction to
all levels of government.
Slide 2:
•
•
•
•
This report is an update of CASAColumbia’s 2001 report of the same name that documented
costs of substance abuse to state governments.
This study was conducted in response to multiple requests from the states for updated state data.
We also extended the analysis to the federal and local levels.
This report breaks down substance related spending to look at:
1. How much goes to carry the burden of substance abuse and addiction in public programs.
By burden we mean the costs that governments incur to deal with the consequences of our
failure to prevent or treat the problem--consequences that drive up costs, for example, of
health care, crime, child neglect and abuse, and even workforce spending.
2. And how much of it goes to the familiar categories of substance related spending:
prevention, treatment, research, taxation, regulation, and drug interdiction.
Finally, the report identifies many promising and cost effective investment options.
Slide 6:
•
Of the $4.4 trillion in total federal, state and local government spending in 2005, at least $467.7
billion (10.7% of total spending) went to deal with substance abuse and addiction.
© CASAColumbia 2013
29

30. Speaker Notes
Slide 8:
•
The most shocking finding is that 95.6% of total substance-related federal and state spending
goes to shovel up the burden of this health problem in the budget categories you see here.
Slide 9:
•
•
Only 4.4% of state and federal spending is divided among these more familiar categories.
This report is a searing indictment of the policies of government at every level that spend virtually
all of the funds in this area to shovel up the wreckage of substance abuse and addiction and
relatively little to prevent and treat it.
Slide 10:
•
•
Here you can see how the burden to public programs at the federal and state level consumes our
resources.
Less than 2 cents of every substance abuse dollar goes to prevention and treatment, despite
extensive evidence of cost-effective strategies.
© CASAColumbia 2013
30

31. Speaker Notes
Slide 11:
•
•
•
•
Despite the enormity of spending in this area, these estimates are in every measure conservative:
In cases where our data were limited, we always chose the conservative estimate.
In some areas, such as you see here, we were not able to make any estimates due to data
limitations.
The true costs to government are likely much higher than our estimates suggest.
Slide 12:
•
Even with these conservative assumptions,
• If spending on tobacco, alcohol and other drugs were its own state budget category, it would
rank second, surpassed only by state spending on elementary and secondary education.
• At the federal level, it would rank 6th behind the big ticket items like social security, national
defense and health.
Slide 13:
•
Total government substance-related spending on the burden to public programs amounts to an
average of $1,486 each year for every person in America--almost $6,000 for a family of 4.
© CASAColumbia 2013
31

32. Speaker Notes
Slide 14:
•
•
Two areas of spending on the burden of substance abuse and addiction to government comprise
almost 3/4 of federal and state burden spending: health care and the justice system.
The largest share is the impact on health spending where untreated addiction drives
hospitalizations for more than 70 other diseases.
Slide 15:
•
•
•
•
With these next 3 slides, you will see how the burden to public programs is distributed at each
level of government.
This is the 95.6 cents of every substance abuse dollar.
At the federal level, spending on the burden of this disease in our health care programs consumes
74% of federal burden spending.
The next largest category is child and family assistance--welfare and services for children who are
neglected and abused.
Slide 16:
•
•
At the state level, justice system spending makes up the largest share of the burden,
Followed closely by health care and the cost of substance abuse to the education system—such
as special education for those with substance-related learning disabilities or mental retardation.
© CASAColumbia 2013
32

33. Speaker Notes
Slide 17:
•
•
As with the states, substance-related justice spending is the largest share of local burden
spending.
Substance-related education spending comes in second locally, followed closely by health care.
Slide 18:
•
•
Here is a summary of how the federal and state burden spending breaks out by category.
Health care spending dwarfs all other categories.
Slide 19:
•
Here is the same information for the remaining categories of spending.
© CASAColumbia 2013
33

34. Speaker Notes
Slide 20:
•
•
Tobacco and alcohol taxes reduce use and provide much needed government revenues--but
these taxes don’t begin to offset the burden substance abuse imposes.
For each dollar federal and state governments receive in tobacco and alcohol taxes and liquor
store revenues, they pay almost $9 on the burden of substance abuse.
Slide 21:
•
•
•
Even though spending on prevention, treatment and research is very low, there are wide
variations among the states.
For every $100 in substance-related spending,
• The federal government spends $2.33 on prevention, treatment and research
• And states spend on average about the same--$2.38
But spending ranges from a low of:
• $0.22 in New Hampshire
• To a high of $10.39 in Connecticut
© CASAColumbia 2013
34

35. Speaker Notes
Slide 22:
•
•
There is much more detail in the report on substance-related spending by jurisdiction, and a wide
range of recommendations.
Key recommendations are designed to reverse our upside down spending patterns.
Slide 23:
•
•
•
Prevention is a top priority and the main focus of our prevention efforts must be our children.
Prevention strategies should include broad-based public health information campaigns to:
• Increase public understanding about addiction, and
• Change the culture around alcohol and other drug use as we have done with tobacco.
Examples are:
• Targeted media campaigns like the Legacy’s truth campaign
• Comprehensive school and community-based programs
• And screenings and brief interventions in many different venues to look for the problem and
intervene early before the disease and its cost progress.
© CASAColumbia 2013
35

36. Speaker Notes
Slide 24:
•
•
•
•
•
Effective evidence-based treatment is critical.
Approximately 9% of the population suffers from an addictive disorder, but only about 10% of them
receive treatment--lower than for any other health condition.
Treatment includes:
• Behavioral and pharmacological approaches
• Treatment for mental and other health disorders that co-occur with addiction
• And long term disease management as would be provided for diabetes and hypertension, for
example.
Health insurance coverage for early intervention and treatment, as we do with other chronic
diseases, is essential--as is expanded coverage for the uninsured.
A review of the cost-related research on treatment by the National Institute on Drug Abuse found
that investments in treatment alone could yield a savings of $12 or more for every dollar invested.
© CASAColumbia 2013
36

37. Speaker Notes
Slide 25:
•
•
•
•
We need to do a better job of regulation and control.
Taxation on tobacco can help reduce smoking and on alcohol can curb both underage and adult
excessive drinking.
Raising alcohol and tobacco taxes also are linked to immediate health and cost benefits as are
indoor smoking bans
And increased enforcement can help keep these substances out of the hands of children and
teens.
Slide 26:
•
We need to increase our knowledge about the disease of addiction and more cost-effective
prevention and treatment options.
© CASAColumbia 2013
37

38. Speaker Notes
Slide 27:
•
•
•
•
Medical science has demonstrated that addiction is a disease that can and should be prevented
and treated. America’s failure to recognize this fact has resulted in untold and avoidable human
suffering as well as the billions in wasted spending this report has uncovered.
The findings of this report suggest a huge opportunity for costs savings--savings that are
particularly crucial in these times of tight budget constraints. The shifts in investments we
recommend do not all require new money. We need to change the way we do business--for
example, paying for treatment and training instead of simply incarceration.
Because there is no broad-based implementation plan in place, we can’t put a definitive price on
expected savings. We do know, though, that specific interventions can yield significant returns in a
short period. For example:
• Screenings and brief interventions can reduce hospitalizations by up to 37% and ER visits by
up to 20% in a year
• Treatment can reduce alcohol- or other drug-related medical visits by more than 1/2 in a year
• A 10% increase in cigarette taxes can reduce youth smoking by 6-7%.
And we know that the impact is likely compounded as more and more interventions are taken to
scale.
© CASAColumbia 2013
38