<p> <b> Background and Aims: </b> The configuration of alcohol and other drug treatment service systems has been influenced by the uptake of market mechanisms for treatment funding and purchasing. This study measured the impact of market mechanisms for funding and purchasing alcohol and drug treatment services on client outcomes. <br/>
<b> Design: </b> An observational cross-sectional study, employing multi-level analysis: episodes of care data, nested within person-level data, nested within treatment site and nested within organization. <br/>
<b> Setting and participants: </b> One hundred and seventy-eight alcohol and other drug treatment service sites in Australia. <br/>
<b> Measurements: </b> Client outcome variables were length of stay and successful treatment completion. Predictor variables were competitive tendering, number of funding contracts, recurrent funding, the ratio of episodes to staff, type of professions, years of clinical experience, staff turnover and type of provider (government; non-government). Analyses controlled for drug type, type of treatment received and client characteristics. <br/>
<b> Findings: </b> There were no significant associations between the procurement and contracting variables and length of stay [incidence rate ratios (IRRs) ranged between 1.01 and 1.07, all <i>P</i> > 0.05; Bayes factors (BF) < 0.03], and inconclusive results for treatment completion [odds ratios (ORs) ranged between 1.04 and 1.15, all <i>P</i> > 0.05, BF = 0.51-0.63]. Having an alcohol and other drug (AOD) work-force relative to an 'other' work-force (IRR = 0.79, <i>P</i> = 0.021) and lower case-loads (IRR = 0.99, <i>P</i> = 0.047) may be associated with longer stay in treatment. Receiving services from a government compared to non-government provider may also be associated with less treatment completion (OR = 0.34, <i>P</i> = 0.023, BF = 2.14). <br/>
<b> Conclusions: </b> There appears to be no association between client outcomes and procurement and funding contract arrangements for alcohol and drug treatment services. </p>