The Impact of Access to Substance Abuse Treatment on Disability

Substance use disorder (SUD) is more prevalent among the disabled compared to the non-disabled (Glazier and Kling, 2013). The purpose of this study is to investigate the extent to which access to SUD treatment as well as the types of treatment available impact the fraction of individuals on Social Security Disability Insurance (DI) within a county. To causally identify the effect on access to SUD treatment facilities, we exploit both geographic and temporal variation created by state expansions to Medicaid after the Affordable Care Act (ACA).

Our project is particularly important because it contributes to the literature examining both the effect of state Medicaid expansions on disability and the availability of SUD treatment. The current literature finds that the direct effect of state Medicaid expansions on disability are mixed (Chatterji and Li, 2016; Hyde et al., 2017). However, due to data constraints, these studies fail to consider how access to SUD treatment changed.

The predicted effect of increased access to SUD treatment on disability is theoretically ambiguous, and thus, left as an empirical question. For example, if increased access to SUD treatment leads to better management of pain-related ailments, then this could reduce the number of disability beneficiaries. However, individuals cannot qualify for disability benefits if drug and alcohol addiction are determined to be a material factor causing disability, increased access to SUD treatments could increase disability beneficiaries by reducing the number of people disqualified from SUD related conditions.

We improve on the existing literature by using a unique dataset of licensed SUD treatment centers containing geocoded information for the near census of facilities in the country between the years 2005 and 2017. The rich administrative facility data contain information on the types of insurance accepted as well as the types of treatment offered by the individual facility. We use variation in the number of SUD treatment facilities accepting Medicaid as a form of payment over time and across counties, to identify the effect of changes in access to licensed SUD treatment facilities on disability claims in states that expanded Medicaid. We use a differences-in-differences estimation strategy to examine the impact by exploiting county level pre-expansion variation in the supply of SUD treatment facilities.

Ultimately, we find that state Medicaid expansions had no impact on the number of treatment facilities among counties in states with Medicaid expansions, no impact on the likelihood of a treatment facility accepting Medicaid as a form of payment or the number of disability applications. Our model is robust to the inclusion of individual SUD treatment facility fixed effects. The results are important given that several states are actively considering enacting a Medicaid expansion.