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How Obamacare could reduce crime and incarceration

New research shows that increased insurance coverage for substance abuse reduces violent crime and property theft.
A patient from Staten Island at the Dynamic Youth Academy, a drug treatment facility in the Brooklyn borough of New York, Feb. 19, 2014.
A patient from Staten Island at the Dynamic Youth Academy, a drug treatment facility in the Brooklyn borough of New York, Feb. 19, 2014.

By expanding coverage for substance abuse treatment, Obamacare could potentially help reduce crime and incarceration — provided that beneficiaries can actually access the help they need. 

Researchers at Emory University found that expanding health care coverage increases the use of substance abuse treatment and reduces aggravated assault, robbery, and larceny, according to their new working paper for the National Bureau of Economic Research. 

The researchers examined two pre-Obamacare reforms in the 2000s: a federal waiver under the Bush administration that gave states the option of expanding their Medicaid and State Children’s Health Insurance Programs, and state-level parity laws requiring that private insurers offer substance abuse treatment on par with comparable medical and surgical treatment. Between 2001 and 2008, 15 states expanded coverage through the Bush waiver, and 10 passed state parity laws between 2000 and 2008.

The study — which controlled for economic, demographic, and law enforcement differences in different areas of the country — found that both reforms increased the treatment rate for substance abuse, and that doing so decreased crime as well. Overall, the researchers concluded that a 10% increase in the substance abuse treatment rate reduces robbery by 3%, reduces aggravated assault by 4 to 9%, and reduces larceny theft by 2 to 3%. They also find that it's a good investment: For $1 spent on treatment, an estimated $1.60 to $3 are saved due to crime reduction.

"To put these numbers into context, incarceration, which has been attributed to one third of the crime decline during the 1990s, has a benefit-cost ratio centered around 1.5," the authors write. "Therefore, [substance abuse] treatment not only appears to be a more effective but also a more cost-effective alternative to incarceration at reducing crime."

The paper adds to a deep and growing body of research showing that treatment for substance abuse is a cost-effective way to reduce crime and reliance on the criminal justice system. "They are not cure-all, they have tremendous shortcomings, and individuals will have a mixed response to them. But overall, they are very cost-effective and implemented in an evidence based way, will not only make the community safer but also improve people’s lives," says Harold Pollack, a health policy professor at the University of Chicago.

Given its national focus and use of data on the county level, "the greatest benefit of this study is its comprehensiveness," says Eric Goplerud, senior vice-president of NORC at the University of Chicago, though he notes that the effect on crime that the paper documents is still "relatively small."

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But the paper is also notable for connecting specific policy reforms to crime reduction through the health care system. "This has direct relevance to the current health care reform discussion," the authors write, noting that the Affordable Care Act builds upon these earlier reforms by both increasing coverage — particularly through the Medicaid expansion — and increasing parity for mental and behavioral health treatment.

The ultimate impact of Obamacare on crime and the costs to the criminal justice system will largely depend on how well it's implemented to reach high-risk populations. In some states that have expanded Medicaid, officials are taking steps to help inmates enroll in Medicaid, so they'll be covered upon release. New York and Colorado estimate that 80% and 90% of their state prison inmates, respectively, are likely to be eligible for Medicaid under the expansion, according to a new report from the Government Accountability Office.

Even those enrolled in health coverage may still face barriers to treatment. The current health system might not have the capacity to meet increased demand: Barriers include "workforce shortage with declining number of training programs and graduates, lack of infrastructure and resources distributed to minority communities and rural areas, the reluctance of providers to accept Medicaid and other insurance for which the reimbursement rate is relatively low," the paper notes. What's more, "many Medicaid programs and commercial insurance have disproportionate restrictions on access to substance abuse treatment" when it comes to certain drug protocols and services, notes Goplerud.

But given the tremendous economic and social costs of incarceration, there has also been growing pressure to pursue new paths to keeping people out of jail, including mental and behavioral health. And the latest findings add to the evidence that "policies that expand [substantial abuse] treatment can be effective at reducing crime," says Pollack. "The Affordable Care Act will have a crime control dimension."