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California's Proposition 36 offers nonviolent drug offenders community-based treatment as an alternative to incarceration or probation without treatment. The study objective was to examine how substance abuse treatment providers perceive the impact of Proposition 36 on their clinical decision making. Program surveys were completed by 115 treatment programs in five California counties to assess the impact of the law on clinical decision making, and five focus groups were conducted with 37 treatment providers to better understand their perspectives. Compared to residential programs, outpatient programs reported that the policy impacted them to a greater extent in terms of drug testing, reporting to criminal justice personnel, and determining client discharge. Providers in the focus groups particularly highlighted their changing roles in assessing clients' treatment needs and determining the best routes of care for them. The findings indicate that alternate strategies for determining treatment placement and continuing care should be developed.