MANAGED CARE AND TECHNICAL EFFICIENCY IN OUTPATIENT SUBSTANCE-ABUSE TREATMENT UNITS

This article examines (I) the extent to which managed care participati on is associated with technical efficiency in outpatient substance abu se treatment (OSAT) organizations and (2) the contributions of specifi c managed care practices as well as other organizational, financial, a nd environmental attributes to technical efficiency in these organizat ions. Data are from a nationally representative sample survey of OSAT organizations conducted in 1995. Technical efficiency is modeled using data envelopment analysis. Overall, there were few significant associ ations between managed care dimensions and technical efficiency in out patient treatment organizations. Only one managed care oversight proce dure, the imposition of sanctions by managed care firms, was significa ntly associated with relative efficiency of these provider organizatio ns. However several organizational factors were associated with the re lative level of efficiency including hospital affiliation, mental heal th center affiliation, JCAHO accreditation, receipt of lump sum revenu es, methadone treatment modality, percentage clients unemployed, and p ercentage clients who abuse multiple drugs.