Performance contracting to engage detoxification-only patients into continued rehabilitation

In 2006, only 18.7% of Delaware's detoxification patients were admitted to continuing recovery-oriented treatment within 30 days after discharge. In response, Delaware established financial contingencies to (1) maintain 90% detoxification occupancy, (2) make receipt of 10% of the facility's monthly reimbursement contingent on 25% of patients entering treatment, and (3) provide a $500 bonus for every patient with three or more prior detoxification visits who was retained in treatment.Under the performance contract, the detoxification provider (1) maintained the 90% occupancy requirement, (2) achieved the 25% treatment entry target for 7 of 12 months, and (3) observed only 8% (27/337) of detoxification completions that met the targeted length of stay. Continuation to and retention in treatment was even more constrained for patients with three or more prior detoxifications. Contrary to the policy intent, the number of patients with three or more detoxifications in fiscal year (FY) 2008 is nearly triple that of FY 2006. The modest gain in the transition rate was achieved without changes in patient access; the FY 2008 patient population reported significantly higher rates of homelessness and a younger age of first use than before the performance contract in FY 2006. Performance contracting may offer promise for improving transition to treatment rates. However, the unique needs of detoxification patients, the treatment capacity of each level of care to meet patient needs, and the structure of the performance contract must be carefully considered. Performance contracting efforts may be strengthened when service contracts across the system are tightly synchronized.