How the drug treatment services system is funded

Page content: Introduction | Non-residential services | Residential services | Where does the funding come from?

Introduction

The Victorian Government provides the community with drug treatment services through a purchaser-provider model. This means that, rather than providing services itself, the Government purchases these services from independent agencies on behalf of the community.

The Drug Treatment Services Program identifies a range of services, which cover the needs of clients experiencing substance abuse issues. The range of services purchased is detailed in the Rural and Regional Health and Aged Care (RRHACS) Policy and Funding Plan. Each of these services has key service requirements that define the service.

Activity descriptions and performance measures associated with Drug Treatment services are also outlined in the RRHACS Policy and Funding Plan. The major services under the Drug Treatment Output are Counselling, Consultancy and Continuing Care; Outpatient Withdrawal; Home-Based Withdrawal; Residential Withdrawal; Rural Withdrawal; Residential Rehabilitation; Peer Support; Youth Outreach; Specialist Methadone Service; Koori Community Alcohol and Drug Worker and Koori Community Alcohol and Drug Resource Services.

In the case of the Drug Treatment Services Program, the key output being purchased is an episode of care. An episode is defined as:
"A completed course of treatment undertaken by a client under the care of an Alcohol and Drug worker which achieves significant agreed treatment goals".

As each service type provides clients with a different mix of clinical skills and practices, the cost of an episode of care varies across services. Most Drug treatment activities have a unit price based on the input costs required to deliver a particular episode of care. This provides for a consistent funding model across funded agencies.

Most of the drug treatment budget is recurrently allocated to services engaged in the direct delivery of services. Where new funding becomes available, the allocation process is determined according to Government funding and purchasing policy.

Depending on the level of funding and the type of service proposed, this process may involve an open tender, invited submission or direct allocation. Where a tender is required, the tenders specify what service should be provided, what geographical area should be covered by the service, how the service should operate and how many episodes of care should be provided to clients.

Successful agencies are funded by the Drug Treatment Services Program through a Service Agreement. Under the DHS Partnership Project, the Department has committed to 3 year service agreements in order to provide greater funding certainty for funded services. The agreements specify the payment the agency is to receive as well as performance measures and targets.

Current Service prices as at February 2004 are detailed below.

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Non-residential services (1)

Residential services (2)

1. Non-Residential Services are costed on the basis of EFTs (equivalent full-time positions).
   
2. Residential Services are costed on the basis of bed-days.
   
3. Cost refers to the total resources needed to operate a service; price refers to the grant given by DTSU/DHS to an agency for the operation of a service. The difference will generally be met by client contribution.

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Where does the funding come from?

Ongoing base funding for Drug treatment services is provided through the State budget and indexed annually.

The State Government committed additional funds to drug services when the Victorian Government Drug Initiative (VGDI) was launched in 2000. The VGDI recognised the growing need for additional drug treatment and education programs. Under the VGDI, a new range of services has now been implemented targeting Drug Prevention, Saving Lives and Local Drug strategies, treatment and counselling for young people, homeless people, Koori and CLD programs and family support.

The Victorian Government committed $77 M to the VGDI over 3 years (2000/01 – 2002/03). From 2003-04, $176 M has been committed over 4yrs to a Whole of Government Drug Strategy ($48 M 2003/2004). From 2003-04, Drug programs previously funded on a fixed term basis through the Community Support Fund now have ongoing recurrent funding secured through the State budget. The Commonwealth, part of the National Illicit Drug Strategy, funds some $5.5M each year and this allocation is matched by State funds in order to enhance and expand the treatment capacity available to the community.

In 2003, the Commonwealth Government agreed to continue funding through the Council of Australian Governments (COAG) Drug Diversion initiative. Funding of $48M over 4 years commencing 2003-04 has been committed to continuing these programs which fund the diversion of clients from the Criminal justice system into drug treatment It is recognised however that, in order to reduce harm to both the individual drug user and the community, there needs to be opportunities to divert illicit drug users into assessment and treatment at all stages of the criminal justice system.

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