This study compared two types of residential programs that treat dually dia
gnosed homeless veterans. Programs specializing in the treatment of substan
ce abuse disorders (SA) and those programs addressing both psychiatric diso
rders and substance abuse problems within the same setting (DDX) were compa
red on (1) program characteristics, (2) clients' perceived environment, and
(3) outcomes of treatment. The study was based on surveys and discharge re
ports from residential treatment facilities that were under contract to the
Department of Veterans Affairs Health Care for Homeless Veterans program a
national outreach and case management program operating at 71 sites across
the nation. Program characteristics surveys were completed by veterans in
treatment, and discharge reports were completed by Va case managers. DDX pr
ograms were characterized by lower expectations for functioning, more accep
tance of problem behavior, and more accommodation for choice and privacy, r
elative to SA programs after adjusting for baseline differences. Dually dia
gnosed veterans in DDX programs perceived these programs as less controllin
g than SA programs, but also as having lower involvement and less practical
and personal problem orientations. At discharge, a lower percentage of vet
erans from DDX than SA programs left without staff consultation. A higher p
ercentage of veterans from DDX than SA programs were discharged to communit
y housing rather than to further institutional treatment. Program effects w
ere not different for psychotic and non-psychotic veterans. Although differ
ences were modes, integration of substance abuse and psychiatric treatment
may promote a faster return to community living for dually diagnosed homele
ss veterans. Such integration did not differentially benefit dually diagnos
ed veterans whose psychiatric problems included a psychotic disorder.