Specialized intervention programs for people with concurrent severe me
ntal illness and substance abuse reduce the total costs of care. Compa
red to baseline, cost savings of over 40% were achieved by 18 months p
rimarily due to significant reductions in the use of acute and subacut
e mental health services and despite an increase in outpatient mental
health services. There also was an observable impact on cost reduction
s in medical and criminal justice services without an increase in fami
ly costs over the same time period.