Economic impact of substance abuse in Indiana

Background: Substance abuse and addiction have a profound impact on all sectors of society. They are major contributors to a wide range of health and social problems, including domestic violence, child abuse and neglect, crime, chronic health problems, increased mortality, higher healthcare costs, and lost productivity. The real economic impact of substance abuse is difficult to quantify empirically because there are both direct and indirect consequences. Methods: In 2009, CASA released a study that measured the financial burden of substance abuse/addiction on both the nation and individual states. Since Indiana did not participate in the study, and an estimate of costs attributable to substance abuse is critical in guiding prevention planning, the State Epidemiology and Outcomes Workgroup (SEOW) decided to replicate CASA's methodology and assess Indiana's expenditures related to alcohol, tobacco, and drug abuse. We (SEOW) followed CASA's methodology whenever possible and attempted to identify federal, state, and local spending for FY 2008. In instances where we could not retrieve detailed data from state departments, we relied on the as-passed state budget. Findings: According to our analysis, a total of $7.3 billion in allocations can be attributed to substance abuse; representing a per-capita share of $1,145. Most of Indiana's funding is allocated to address the consequences of alcohol, tobacco, and other drug use rather than to prevent or reduce its occurrence. For every dollar Indiana spends on services dealing directly or indirectly with substance use, 66 cents are used for healthcare, while only 1 cent pays for prevention/intervention initiatives.