Addressing America's Substance Use Epidemic: Carrum Health Pioneers Value-Based Treatment in Response to Critical Unmet Need

First of its kind, value-based substance use treatment tackles a $35 billion annual cost for employers with better patient outcomes and 52% cost savings

SAN FRANCISCO, Oct. 8, 2024 /PRNewswire/ -- Carrum Health, the leader in value-based Centers of Excellence (COE), today announced the launch of a pioneering value-based treatment model for substance use disorders. This will expand its portfolio of well-established specialty care services, including surgery and cancer, to now address a significant unmet need in the employer market given the rapidly growing incidence and costs associated with substance use. Carrum's substance use treatment program, successfully road tested with a Fortune 50 retailer, offers employers and their members access to top quality treatment centers nationwide with 52% cost savings over traditional insurance – and zero out-of-pocket costs for employees.

The data points to high prevalence, high costs
This strategic expansion is hyper focused on tackling a pervasive, deep rooted societal problem which has grown to epidemic proportions. Seventy million¹ people deal with substance use disorders, specifically opioid and alcohol use, per the latest Substance Abuse and Mental Health Services Administration (SAMHSA) national survey data, which has a devastating impact not just on them but also their families and friends and their ability to function in the workplace and daily life. CDC researchers concluded it costs U.S. employers $35 billion annually in medical expenditures.

Despite the widespread need, there are multiple barriers to accessing affordable, reliable evidence-based treatment, as the numbers show:

• 94% – people with substance use who did not receive any treatment per SAMHSA, because of the high cost, lack of access and stigma from exposure
• 40-60% – relapse rates for substance use per the National Institute of Drug Abuse, making this a revolving door that some refer to as the 'washing machine model' of rinse and repeat cycles of relapses
• $31,000 – average employer spend per patient per episode of substance use disorder treatment, based on Carrum analysis of claims data

All of this data points to a huge problem with high prevalence and ballooning costs that have only increased since the pandemic.

This is why nearly 50% of employers are seeking a COE treatment model for substance use, and 22% of them have made it a key priority for 2025 according to the Business Group on Health 2025 survey². One major concern for employers is the trend of members seeking care at out-of-network centers which further spikes costs since there are no set prices and predatory centers charge arbitrary pricing for questionable quality and outcomes.

Employers keen on transparent, bundled treatments
Carrum has a decade of experience designing innovative solutions for complex problems in response to critical unmet employer needs – in 2014 Carrum developed a surgical care solution, and in 2021 the company launched the commercial market's first value-based cancer care program when employers sought ways to rein in soaring costs. Carrum has built on this long-established tradition of innovation with a pioneering value-based substance use treatment model using transparent, pre-negotiated, bundled payments. This approach makes employer costs predictably lower, eliminates predatory or out-of-network pricing, and requires providers to take on risk for patient outcomes which aligns incentives to reduce relapses and readmissions.

After a successful launch with a Fortune 50 employer which sought Carrum's help, the program is now being launched nationally and the majority of Carrum's current and new clients are offering the benefit to their employee populations beginning January 2025.

"Employees using opioids, alcohol and other substances struggle not only with addiction, but also with the fear of exposure and stigma surrounding use. When you add to that the lack of reliable, high quality treatment centers, unaffordable care, and the challenge of balancing treatment with family and work responsibilities, the obstacles to treatment are often insurmountable," said Sach Jain, Founder and CEO of Carrum Health. "We've built the first substance use treatment program that overcomes these barriers, offering employers a solution that provides their members with the comprehensive support they need and deserve."

How the Carrum program works
When a member reaches out to Carrum seeking help, a licensed substance use counselor speaks with them in a completely confidential intake session,  and connects them in short order to the appropriate COE provider so they can begin treatment within 24 to 48 hours. Continuity of care is critical to ensure patients achieve sustained sobriety, so each patient is matched with the appropriate level of care they need – whether that's inpatient detox followed by a residential program, step-down intensive outpatient program or partial hospitalization program.

Carrum has built its high-quality substance use provider network with carefully vetted COE partners across the U.S, such as Hazelden Betty Ford and other evidence-based, reputed treatment centers. All COE partners have to meet Carrum's stringent quality criteria, and were thoroughly evaluated on programs and data for readmissions, sustained sobriety rates and continuity of support.

"Over the last 75 years Hazelden Betty Ford has been committed to improving the lives of people with substance use disorders," said Bob Poznanovich, Chief Growth Officer, Hazelden Betty Ford Foundation. "We are excited to be recognized as a Center of Excellence by Carrum Health and look forward to serving their members, employer groups and the community in the months and years to come. Our partnership will help break down the stigma associated with addiction and create opportunities for people to get the high-quality care they need and deserve."

About Carrum Health
Carrum Health is changing how we pay for and deliver care. We offer self-insured employers a value-based Centers of Excellence (COE) solution that connects their members with a rigorously vetted network of specialty care providers. Carrum's upfront, all-inclusive bundled pricing, award-winning technology, and dedicated care navigation team help lower costs for both members and employers while delivering a superior member experience. Carrum is independently validated to reduce unnecessary procedures by as much as 30%, lower readmissions by 80% and save employers up to 45% per episode of surgical care. Learn more at carrumhealth.com.

Media Contact:
Padma Nagappan
[email protected]

SOURCE Carrum Health