BACKGROUND: The importance of a continuing care approach for substance use disorders (SUDs) is increasingly being recognized. Our prior research found that a Continuing Care model for SUDs that incorporates 3 components (regular primary care, and specialty SUD and psychiatric treatment as needed) is beneficial to long-term remission. The study builds on this work to examine the cost implications of this model. OBJECTIVES: To examine associations between receiving Continuing Care and subsequent health care costs over 9 years among adults entering outpatient SUD treatment in a private nonprofit, integrated managed care health plan. We also compare the results to a similar analysis of a demographically matched control group without SUDs. STUDY DESIGN: Longitudinal observational study. MEASURES: Measures collected over 9 years include demographic characteristics, self-reported alcohol and drug use and Addiction Severity Index, and health care utilization and cost data from health plan databases. RESULTS: Within the treatment sample, SUD patients receiving all components of Continuing Care had lower costs than those receiving fewer components. Compared with the demographically matched non-SUD controls, those not receiving Continuing Care had significantly higher inpatient costs (excess cost = $65.79/member-month; P < 0.01) over 9 years, whereas no difference was found between those receiving Continuing Care and controls. CONCLUSIONS: Although a causal link cannot be established between receiving Continuing Care and reduced long-term costs in this observational study, the findings reinforce the importance of access to health care and development of interventions that optimize patients receiving those services and that may reduce costs to health systems.