Improving public addiction treatment through performance contracting: The Delaware experiment

Abstract

In fiscal 2002, Delaware replaced traditional cost-reimbursement contracts with performance-based contracts for all outpatient addiction treatment programs. Incentives included 90% capacity utilization and active patient participation in treatment. One of the programs failed to meet requirements. Strategies adopted by successful programs included extended hours of operation, facility enhancements, salary incentives for counselors, and two evidence-based therapies (MI and CBT). Average capacity utilization from 2001 to 2006 went from 54% to 95%; and the average proportion of patients' meeting participation requirements went from 53% to 70%--with no notable changes in the patient population. We conclude that properly designed, program-based contract incentives are feasible to apply, welcomed by programs and may help set the financial conditions necessary to implement other evidence-based clinical efforts; toward the overall goal of improving addiction treatment.