Does higher cost mean better quality? evidence from highly-regarded adolescent drug treatment programs

Abstract We conducted a survey to examine whether reimbursement levels are associated with the quality of adolescent substance use treatment programs in the United States. Between March and September 2005, telephone and written surveys were administered to program, clinical, and finance directors of previously surveyed highly regarded programs. Differences in quality scores were compared for programs with above versus below median reimbursement levels and examined in multivariate regression models constructed separately for programs offering residential and outpatient treatment. In residential treatment multivariate regression models, higher quality scores were associated with higher reimbursement, but this relationship was not observed for outpatient treatment. Even the highest level of outpatient reimbursement received may be too low to support quality improvement initiatives. Our results suggest that higher reimbursement may be a necessary component of quality improvement for residential adolescent drug treatment programs, and emphasize the need for further research to determine what levels of reimbursement and insurance coverage policies will encourage the expansion of high quality outpatient programs.