Copyright 1999 Federal News Service, Inc.
Federal News Service
OCTOBER 21, 1999, THURSDAY
SECTION: IN THE NEWS
LENGTH:
2891 words
HEADLINE: PREPARED TESTIMONY OF
R.
MICHAEL CONLEY
CHAIRMAN OF THE BOARD OF TRUSTEES
HAZELDEN FOUNDATION
ON BEHALF OF THE
PARTNERSHIP FOR RECOVERY
BEFORE THE
HOUSE GOVERNMENT REFORM COMMITTEE
CRIMIANL JUSTICE, DRUG
POLICY AND HUMAN RESOURCES COMMITTEE
SUBJECT - EFFECTS OF SUBSTANCE ABUSE
PARITY
IN PRIVATE INSURANCE PLANS UNDER MANAGED CARE
BODY:
Mr. Chairman and members of the
subcommittee, good morning. My name is Mike Conley. I am a former
health insurance executive and Chairman of the Board of the
Hazelden Foundation, an organization that has been providing a continuum of
services for people suffering from chemical dependency and their families for
the past 50 years. I am also a grateful recovering alcoholic.
I would like
to thank you for the opportunity to testify before your subcommittee. Chemical
dependency is a public health problem that affects millions of
people and imposes enormous financial and social burdens on society. It destroys
families, victimizes individuals and communities, and suffocates the
educational, criminal justice, and social services systems. It is a disease that
can affect anyone regardless of age, cultural background, or profession.
I
am testifying today on behalf of the Partnership for Recovery, a coalition of
non-profit alcohol and drug treatment providers that includes four of the
nation's leading treatment centers: the Betty Ford Center, Caron Foundation,
Hazelden Foundation and Valley Hope Association, collectively representing
250,000 individuals who completed treatment for alcohol or drug addictions.
The Partnership is dedicated to improving access to professional treatment
for all Americans suffering from the disease of addiction. Addiction is a
chronic, relapsing brain disease that is treatable. We are committed to the
pursuit of equitable and non-discriminatory treatment for those individuals
and/or family members with the disease of chemical dependency.
Members of
the Partnership for Recovery hope to broaden the public's understanding of the
disease and create an awareness of the value of professional treatment. We share
a common philosophy and more than 100 years of treatment experience based on the
12-Step model with an emphasis on family involvement and individual recovery.
As leaders in the field, the Partnership for Recovery believes that we have
an obligation to provide information on the 12-Step model, the most effective
model of treatment for our patients. The 12-Step or "Minnesota Model" is
characterized by the use of the 12-Step philosophy of Alcoholics Anonymous as a
foundation for therapeutic change in peoples' lives. The treatment goal is total
abstinence from mood-altering substances and improved quality of life. While
this model was developed for residential settings, we believe it can be easily
adopted in community, correctional, or outpatient settings.
At our Centers,
we often see success rates (that is abstinence from alcohol and other drugs for
one year after treatment) ranging from 51- 75 percent using this model of
treatment. It is important to note that no one model of treatment is appropriate
for all patients. We believe that an individualized continuum of care is an
important factor in making recovery last for the addicted person.
Key
Components of the 12-Step Model Include:
1. Assessment; 2. Development of a
individualized plan of care; 3. Execution of the treatment plan; 4. Specific
continuing care plan (including halfway house, group, or individual therapy and
AA or NA attendance; and 5. Post treatment services.
Post treatment services
or continuing care, increase the quality of recovery by helping to prevent
relapse. Based on variability of severity, continuing care options are
individually prescribed. One-to- one counseling and referral to a 12-Step
self-help support group is frequently recommended for those individuals with
supportive family and social environments, employment, and relatively successful
treatment response.
The data is also compelling that longer lengths of stay
yield better outcomes. For example, a 1993 study published by McLellan, Grisson,
Brill, Durell, Metzger and O'Brien reported outcomes of patients from four
private treatment centers, two inpatient and two outpatient. While the programs
varied somewhat in program characteristics, all four programs were based on the
12 Steps of Alcoholics Anonymous, had a goal of abstinence, and utilized a
multidisciplinary team to deliver services. Two inpatient programs yielded an
average abstinence rate of 71 percent, while the two outpatient programs
averaged an abstinence rate of 48 percent.
H.R. 1977: A Cost Savings Tool in
the Workplace
Addiction is treatable and the treatment does work. There are
numerous national studies whose data chronicle the effectiveness of treatment,
the cost savings it affords the workplace, and the life saving and transforming
potential it offers individuals and family members. There are literally millions
of people living new lives in recovery across the United States today.
As a
former businessman, I feel strongly that substance abuse treatment is a cost
savings tool in the workplace. A significant number of American workers abuse
substances, and some of this use occurs at work. Most current drug users age 18
and older are employed -- in fact, 73 percent work, including 6.7 million
full-time and 1.6 million part-time workers, according to the 1997 National
Household Survey on Drug Abuse. In addition, the costs of alcohol and illicit
drug use in the workplace, including lost productivity, medical claims and
accidents, is estimated to be as high as $140 billion per year. (Drug
Strategies, 1996) I ask you to consider the following:
- 70% of people with
drug and alcohol problems are employed and the health care
costs of untreated alcoholics and addicts are 100% higher than treated ones.
(National Household Survey on Drug Abuse, 1994 and Rutgers University study,
1994)
- 60% of employees know someone who has gone to work under the
influence of alcohol or drugs. (Hazelden Foundation, 1996)
- 65% of
emergency room visits are caused by an underlying drug or alcohol problem.
(American Medical Association, 1996)
- 38% to 50% of all workers'
compensation claims are related to substance abuse in the workplace. (National
Council on Compensation Insurance, 1993)A Chevron Corporation study found that
for every $1.00 spent on treatment, nearly $10.00 is saved. As I said, the tools
are there. Simply put: addiction is a disease; it's treatable; and study after
study has shown it's effective. Indeed, comparatively, treatment is a far less
expensive alternative than retraining new workers.
The costs and benefits of
workplace policies are primary considerations for businesses-no single solution
will work for every organization.
However, understanding various
approaches to substance abuse treatment will help employers make the right
decisions for their businesses.
The Corporate Impact of Drug and Alcohol
Addiction
Many corporations have already taken steps to address the issue of
illicit drug use in the workplace by establishing employee assistance programs
(EAPs). EAPs are designed to assist employees with problems that affect their
job performance, such as alcohol and drug abuse, as well as stress, marital
difficulties, financial trouble, and legal problems. Most EAPs offer a range of
services, including employee education, individual and organizational
assessment, counseling, and referrals to treatment. Whichever way a company
chooses to address the issue of addiction among employees, research has shown
that substance abuse treatment results in a significant reduction in medical
claims, absenteeism, and disability; an increase in productivity; and a
healthier and safer environment for all employees. For example:
- General
Motors Corporation's EAP saves the company $37 million per year in lost
productivity - $3,700 for each of the 10,000 employees enrolled in the program.
(American Society for Industrial Security, Substance Abuse: A Guide to Workplace
Issues, 1990)
- United Airlines estimates that it has a $16.95 return in the
form of higher productivity for every dollar invested in employee assistance.
(American Society for Industrial Security, Substance Abuse: A Guide to Workplace
Issues, 1990)
- Northrop Corporation saw productivity increase 43 percent in
the first 100 employees to enter an alcohol treatment program. After 3 years of
sobriety, savings per rehabilitated employee approached $20,000. (Campbell D.
and Graham M. Drugs and Alcohol in the Workplace: A Guide for Managers, 1988)
- Oldsmobile's Lansing, Michigan, plant saw the following results one year
after employees with alcoholism problems received treatment: lost man-hours
declined by 49 percent, health care benefit costs by 29
percent, absences by 56 percent, grievances by 78 percent, disciplinary problems
by 63 percent, and accidents by 82 percent. (Campbell D. and Graham M. Drugs and
Alcohol in the Workplace: A Guide for Managers, 1988) In 1995, the average
annual costs of EAP services per eligible employee nationwide was $26.59 for
internal programs staffed by company employees and $21.47 for programs provided
by an outside contractor. (French, M.T., Zarkin, G.A., Bray, J.W., Costs of
Employee Assistance Programs: Findings from a National Durvey, 1995) These costs
compare favorable with the expense of recruiting and training replacements for
employees terminated because of substance abuse problems - about $50,000 per
employee at corporations such as IBM. (Falco M. The Making of a Drug-Free
America: Programs That Work, 1992)
The Impact of Alcohol and Drug Addiction
on Small Business
America's 23.3 million non-farm small businesses (firms
with fewer than 500 employees) employed more than 50 percent of the private non-
farm workforce in 1996. And the number of small businesses is growing; between
1982 and 1996, the number of small businesses increased by 57 percent. (Office
of Economic Research. The Facts About Small Business, 1997)
Despite the
significant efforts of this subcommittee as well as others to improve the
outlook for drug-free workplaces in the small business community, these
companies fall far behind when it comes to addressing substance abuse in the
workplace. About one-half of coworkers aged 18 to 49 employed in establishments
with fewer than 25 employees reported in 1994 that their employer offered
information or has a written policy on alcohol and/or drug use, compared with
more than 80 percent of workers from medium and large workplaces. In addition, a
study breaking down work establishments by size found that in 1994, 11 percent
of workers aged 18 to 49 in the smallest firms (fewer than 25 employees)
reported current illicit drug use, a rate significantly higher than that for
workers in two larger employment categories (25- 499 employees, and 500 and
more, both of which reported rates of 5.4 percent. In 1994, 12.2 percent of 18
to 25 year old workers, 8.6 percent of 26 to 34 year old workers, and 5.2
percent of 35 to 49 year old workers reported current illicit drug use. (Hoffman
JP, Larson C, Sanderson A. An Analysis of Worker Drug Use and Workplace Policies
and Programs. SAMHSA, 1997)
The data is clear - most small businesses will
at some point be faced with an employee who has a substance abuse problem. Given
that small businesses represent 99 percent of all employers, (Office of Economic
Research. The Facts About Small Business, 1997) the work site is one of the most
effective places to reach Americans with information about the success of
substance abuse treatment.
Treatment and recovery are a sound business
investment. Implementing a substance abuse program enables a small business to
stand out among its competitors as a company that cares about employees and
families in the community by taking steps to ensure that its employees are free
from alcohol and drug addiction. Consider the following:
- A study of 700
hospitality industry employees who were abusing substances and remained on the
job after receiving treatment produced the following results: job-related
injuries declined from 9 percent to 5 percent; tardiness decreased from 39
percent to 7 percent; absenteeism dropped from 42 percent to 5 percent; job
errors declined from 32 percent to 6 percent; and failure to complete assigned
tasks dropped from 23 percent to 5 percent. (U.S. Department of Labor. Working
Partners: Substance Abuse in the Workplace, 1997)
Effectiveness of Treatment
Alcoholism and drug addiction are painful, private straggles with staggering
public costs. Assuring access to treatment will not only combat this insidious
disease -- it will save health care dollars in the long run.
Treatment also helps people remain outside the criminal justice system thereby
reducing federal government expenditures.
- In a major before-and-after drug
abuse treatment study of 4,411 people in federally funded treatment, the
prevalence of illicit drug abuse was cut by about one-half for each illicit
substance (i.e., cocaine, marijuana, crack or heroin), and the number of those
troubled by alcohol abuse dropped by more than two-thirds 5 to 16 months after
treatment. (Gerstein DR, Datta RA, Ingels JS, and others. Final Report: National
Treatment Improvement Evaluation Survey. Center for Substance Abuse Treatment,
SAMHSA, 1997)
- The percentage of people selling drugs, shoplifting, or
beating someone up in the past year dropped by almost 80 percent 5 to 16 months
after treatment. In addition, the percentage of clients receiving welfare
declined from 40 percent to 35 percent - an almost 11 percent overall decrease.
(Gerstein DR, Datta RA, Ingels JS, and others. Final Report: National Treatment
Improvement Evaluation Survey. Center for Substance Abuse Treatment, SAMHSA,
1997)
Substance Abuse Treatment Parity Is an Important
First Step
Once the federal government moves toward a national drug policy
that treats addiction as a disease that has devastating public
health and economic consequences, the case for providing
treatment for the disease becomes evident. We believe that the Substance Abuse
Treatment Parity Act (H.R. 1977) is landmark legislation that
takes an important first-step towards giving people suffering from the disease
of alcoholism and drug addiction increased access to treatment. This legislation
does not mandate that health insurers offer substance abuse
treatment benefits. It does prohibit health plans from placing
discriminatory caps, financial requirements or other restrictions on treatment
that are different from other medical and surgical services.
H.R. 1977 will
help eliminate barriers to treatment -- without significantly increasing
health care premiums. An April 19, 1999 RAND study found that
substance abuse treatment services could be made available to employees for
$5.11 a year, or 43 cents per month.
Unfortunately, the stigma associated
with this disease is subtle and often difficult to document. Recently, a survey
by Peter Hart and Associates captured the essence of the stigma. While over 50
percent of the people surveyed said they believed addiction is a disease, 52- 68
percent said that if addicts really wanted to, they could stop using on their
own.
A March 1999 Substance Abuse and Mental Health
Services Administration (SAMHSA) study reported substantial progress in closing
the gap in group health benefits for physical illness and for
mental disorders following enactment of the Mental
health Parity Act of 1996, without unduly raising premiums.
Under
the Mental Health Parity Act that went into effect in January
1998, group health plans providing both medical/surgical and
mental health benefits may not impose a lifetime or annual
dollar limit on mental health benefits that is less that that
applied to medical/surgical benefits. According to the report, Background
Report: Effects of the Mental Health Parity Act of 1996, the
majority of those employers who made changes to comply with the Act stated that
it did not increase their costs or require major changes to other benefits
provisions. In addition, about half of those employers affected were already in
compliance prior to the law becoming effective in January in 1998.
Conclusion
Mr. Chairman, my statement details what the Partnership
believes are some of the key ingredients necessary for the formulation of public
policy that effectively addresses the essence of the addiction problem:
acceptance of the disease as a critical public health issue,
public policy that has a balanced emphasis on treatment and prevention as well
as interdiction and criminal justice. Federal policy must recognize that
inclusion of demand reduction strategies like treatment doesn't result in policy
that is soft on crime. Last but not least, recognition that all persons,
regardless of their illness should be treated with human dignity. The bill
before you today goes right to the heart of the need for fair and equitable
treatment of people suffering from the disease of chemical dependency.
Mr.
Chairman, momentum is building for our leaders to include a public
health/demand reduction component in our nations drug policy.
We hope this will include a greater emphasis on treatment. We know that H.R.
1977 is a step in the right direction. Congress has the opportunity to take this
first step, and move legislation forward to solve this public
health crisis before another generation is lost to the disease
of drug and alcohol addiction. We ask you to join us in the Fight for Fairness
and incorporate meaningful treatment provisions into our nation's drug policy.
END
LOAD-DATE: October 26, 1999
