To assess, during a period of decreasing psychiatric inpatient utilization, cost savings from Assertive Community Treatment () programs for individuals with severe mental illnesses.
U.S. Department of Veterans Affairs' () national administrative data for entrants into programs.
An observational study of the effects of enrollment on mental health inpatient utilization and costs in the first 12 months following enrollment. enrollees ( = 2010) were propensity score matched to ‐eligible non‐enrollees ( = 4020). An instrumental variables generalized linear regression approach was used to estimate enrollment effects.
Instrumental variables estimates indicate that between 2001 and 2004, entry into resulted in a net increase of $4529 in costs. Trends in inpatient use among program entrants suggest this effect remained stable after 2004. However, eligibility for declined 37 percent, because fewer patients met an eligibility standard based on high prior psychiatric inpatient use.
Savings from programs depend on new enrollees' intensity of psychiatric inpatient utilization prior to entering the program. Although a program eligibility standard based on prior psychiatric inpatient use helped to sustain the savings from programs, over time, it also resulted in an unintended narrowing of program eligibility.