Mental Health and Substance Use Disorder Spending in the Department of Veterans Affairs, Fiscal Years 2000-2007

Objective: This study analyzed spending for treatment of mental health and substance use disorders in the Department of Veterans Affairs (VA) in fiscal years (FYs) 2000 through 2007. Methods: VA spending as reported in the VA Decision Support System was linked to patient utilization data as reported in the Patient Treatment Files, the National Patient Care Database, and the VA Fee Basis files. All care and costs from FY 2000 to FY 2007 were analyzed. Results: Over the study period the number of veterans treated at the VA increased from 3.7 million to over 5.1 million (an average increase of 4.9% per year), and costs increased .7% per person per year. For mental health and substance use disorder treatment, the volume of inpatient care decreased markedly, residential care increased, and spending decreased on average 2% per year (from $668 in FY 2000 to $578 per person in FY 2007). FY 2007 saw large increases in mental health spending, bucking the trend from FY 2000 through FY 2006. Conclusions: VA's continued emphasis on outpatient and residential care was evident through 2007. This trend in spending might be unimpressive if VA were enrolling healthier Veterans, but the opposite seems to be true: over this time period the prevalence of most chronic conditions, including depression and posttraumatic stress disorder, increased. VA spending on mental health care grew rapidly in 2007, and given current military activities, this trend is likely to increase. (Psychiatric Services 62: 389-395, 2011)