CSAT Publications -- TAP 25, The Impact of Substance Abuse Treatment on Employment Outcomes Among AFDC Clients in Washington State

Executive Summary

A. Introduction vii
B. Methods, Data, and Analytical Procedures vii
C. Results viii
D. Conclusions and Implications ix

Questions about the effects of substance abuse treatment have recently been given new urgency by welfare reforms enacted by Congress in the last 4 years. In 1996, Congress enacted the Personal Responsibility and Work Opportunity Reconciliation Act (Public Law 104-193) in an effort to move people off welfare and to establish strong incentives to work. The new law replaced the Aid to Families With Dependent Children (AFDC) program with Federal block grants to States to provide temporary assistance to needy families (TANF); it also imposed a 5-year lifetime limit on welfare payments to families with a minor child.* A key assumption underlying the 5-year lifetime limit is that most welfare recipients can obtain jobs that enable them to move from welfare dependency to economic self-sufficiency.

Obtaining a job and achieving economic self-sufficiency is especially difficult for welfare recipients with substance abuse problems. At a minimum, they need treatment for their substance abuse problems. Substance abuse treatment works, but little is known about the effects of substance abuse treatment on employment outcomes for welfare recipients with substance abuse problems.

The primary purpose of this study was to assess the effect of substance abuse treatment on employment outcomes and earnings among AFDC clients admitted to treatment in Washington State. A second purpose was to illustrate the potential for States to use data from State administrative databases for tracking client outcomes and conducting timely evaluation research. The first chapter of this report discusses the context and purpose of the study. The second chapter outlines the methods, data, and analytical procedures. The third chapter presents the study results, including findings from statistical analyses of the effects of substance abuse treatment on employment outcomes among 5,664 Washington State AFDC clients admitted to substance abuse treatment. The report closes with a chapter on conclusions and implications. A technical appendix presents additional details on the statistical analyses. (Refer Chapter I for details)

B. Methods, Data, and Analytical Procedures

The study sample consisted of 5,664 individuals admitted to substance abuse treatment in Washington State from July 1994 to June 1996 who were receiving financial assistance from AFDC at the time of their admission. Data on these individuals' treatment and employment

* States may exempt up to 20 percent of their welfare caseload from the 5-year lifetime limit.
outcomes-employment, earnings, and welfare payments-were obtained from administrative databases maintained by the State of Washington.
Employment data for the study spanned 5 years, and welfare payment data spanned 4 years, both beginning in July 1993.
The evaluation of the effects of substance abuse treatment on employment outcomes focused on three treatment modalities (see Table ES-1).

Table ES-1. Distribution of Washington State AFDC Clients  Across the Three Substance Abuse Treatment Modalities
Outpatient treatment:
	Treatment group—received 90 days or more of treatment (n = 870)
	Comparison group—received under 21 days of treatment (n = 1,131)
Intensive inpatient (21- or 28-day non-hospital) treatment:
	Treatment group—completed treatment (n = 1,139)
	Comparison group—detoxification clients with no other treatment (n = 261)
Methadone maintenance:
	Treatment group—received 120 days or more of treatment (n = 143)
	Comparison group—received under 60 days of treatment (n = 240)

Analytic procedures included a descriptive analysis and a multivariate statistical analysis. Results from both analyses are summarized below. (Refer Chapter II for details)

In the descriptive analysis, the 5,664 Washington State AFDC clients' earnings and welfare payments were profiled for several quarters before and after substance abuse treatment.

• Earnings levels among AFDC clients in the sample were very modest. In the year before substance abuse treatment, the clients' quarterly earnings declined. In the 2 years after treatment, their quarterly earnings increased.
  
  
• Welfare payments to the AFDC clients, in contrast to earnings, increased in the year before the clients entered substance abuse treatment. In the 1½ -year period after treatment, welfare payments declined. More than one-fourth (27 percent) of the AFDC clients in the sample remained on welfare throughout the 2½-year tracking period.

Because descriptive information does not take into account differences in age, gender, education, or other factors that may affect treatment outcomes, conclusions about the effects of substance abuse treatment on AFDC clients' earnings and welfare payments should not be made on the basis of descriptive information alone. To adjust the data for those factors, statistical analyses were performed.

Statistical analyses of the effects of substance abuse treatment on employment outcomes among the 5,664 AFDC clients in the sample demonstrated that substance abuse treatment had a significant positive effect on employment outcomes:

• AFDC clients in the three substance abuse treatment groups were 50 to 100 percent more likely (p < .05) to become employed in the 2-year post-treatment period than their counterparts in the comparison groups.
  
  
• AFDC clients in the three substance abuse treatment groups had adjusted aggregate earned income levels in the 2-year post-treatment period that were approximately $1,700 to $3,200 (p < .05) higher than the income levels among their counterparts in comparison groups.
  
  
• AFDC clients who had been on welfare for more quarters earned substantially less than clients who had been on welfare for less time. Nevertheless, substance abuse treatment was associated with significant gains in earnings for all AFDC clients, regardless of the length of time they were on welfare.

The finding that substance abuse treatment had positive effects on AFDC clients' employment and earnings was robust across all three of the treatment modalities analyzed: outpatient treatment, intensive inpatient treatment, and methadone maintenance (Refer Chapter III for details)

D. Conclusions and Implications

1. The Effects of Substance Abuse Treatment on AFDC Clients' Employment Outcomes

This study's finding that substance abuse treatment had positive effects on employment and earnings among AFDC clients in Washington State is notable, especially because the primary goal of substance abuse treatment is rehabilitation, not employment. It is important to emphasize, however, that despite gains in income following substance abuse treatment, earnings among the AFDC clients in the sample remained quite low-too low for most clients to achieve economic self-sufficiency. Unless these welfare clients receive vocational services in conjunction with substance abuse treatment, they will probably be unable to become economically self-sufficient.

2. The Utility of Computerized State Administrative Databases for Tracking Client Outcomes and Performing Evaluation Research

Few States have the resources or time to conduct studies involving large-scale primary data collection. Such studies may take years to complete and may produce information of diminished value given the rapid policy and programmatic changes taking place in many States.

This study in Washington State illustrates a useful approach to performing evaluation research-that is, analyzing data provided by computerized State administrative databases. State databases contain client-level data representing important outcome indicators of substance abuse treatment-including employment, public assistance payments, Medicaid utilization and expenditures, and criminal justice information. By utilizing such information, States can greatly improve their capacity to perform timely evaluation and outcome studies. (Refer Chapter IV for details)

For further information, contact the CSAT staff at 240-276-2750.