Medicaid reimbursement costs for county residents at least 18 years old who used a treatment service (n = 1043) and residents who were Medicaid enrollees with a substance abuse diagnosis but who did not receive treatment (n = 2125) were compared. Untreated patients were more likely to be male (47% vs. 39%), white (56% vs. 45%), and older (39.7 yrs. +/- 13 SD vs. 35.5 yrs +/- 10 SD). The average monthly Medicaid costs ($257) for the untreated were higher in the year prior to identification than were costs ($207) for the treated. The monthly costs in the six months following identification were $761 for the untreated and $373 for the treated. The costs in the next six months returned to near the original for the treated ($224), while those for the untreated remained higher at $340. Medicaid enrollees with untreated substance abuse pose a significant cost to the Medicaid system.