The Affordable Care Act (ACA) expanded Medicaid coverage to nearly all adults with incomes up to 138 percent of the Federal Poverty Level ($20,120 for an individual in 2023) and provided states with an enhanced federal matching rate (FMAP) for their expansion populations. The federal government finances 90 percent of the state costs of covering the expansion population, with states contributing the remaining 10 percent. To date, 41 states (including D.C.) have adopted Medicaid expansion.
Medicaid expansion is one important mechanism for ensuring substance use disorder (SUD) treatment services are more widely available to those individuals, including children, who have historically not qualified for Medicaid or Medicare, nor have had coverage under an employer-sponsored or marketplace health care plan. Prior to the ACA, Medicaid eligibility was limited to certain categories, such as low-income children, pregnant women, and individuals with disabilities.
The ACA also made coverage of treatment for mental health and SUD mandatory as one of the ten essential health benefits. Previously, insurers could opt out of providing coverage for behavioral health disorders. This past June, I participated in the Insight to Innovation Center for Integrative Health Spring Conference in Raleigh, NC. One of the overshadowing topics of conversation at the conference centered around the state of North Carolina’s Medicaid expansion efforts. On March 27, 2023, North Carolina Governor Roy Cooper signed NC House Bill 76 into law, making North Carolina the 40th state to expand Medicaid. This is expected to provide health coverage to more than 600,000 North Carolinians. Behavioral health providers in the state, including those who serve a growing number of individuals with an SUD, are hoping this will improve access and quality to a significantly overwhelmed and underfunded treatment ecosystem.
During the conference, I had an opportunity to connect with Bridget Cain, Vice President of Operations at Pyramid Healthcare Inc., which includes October Road Incorporated, a comprehensive SUD treatment provider in Western North Carolina and a member of the Addiction Professionals of North Carolina (APNC). She touched on several of the critical points mentioned above, including Medicaid expansion’s ability to improve access to quality care and address broader issues related to social determinants of health (SDOH).
“Medicaid expansion is going to be so great in so many ways. Not only is it going to allow more clients access to care, but it will also free up some of the state and block grant dollars to help with things like social determinants of health. As far as our organization as a whole, Medicaid expansion will allow us to begin to fill in the service gaps in an innovative way by eliminating funding and regulatory barriers.”
Bridget’s sentiment is an excellent synopsis of how Medicaid expansion will impact SUD treatment providers from a service delivery perspective, and the ability to extend the Substance Use and Mental Health Block Grants offered through the Substance Abuse and Mental Health Services Administration (SAMHSA) by using existing safety net funding to address other recovery support needs which have been historically neglected through third-party payment mechanisms.
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In addition, the Centers for Medicare & Medicaid Services (CMS) created an opportunity under the authority of section 1115(a) of the Social Security Act (Act) for states to demonstrate and test flexibilities to improve the continuum of care for beneficiaries with SUD. To date, CMS has approved Section 1115 Waiver requests from 35 states and the District of Columbia. These 1115 Waivers enable states to expand coverage of SUD services for Medicaid beneficiaries and make it easier for them to access services. For example, an emerging theme in proposed 1115 Waivers is the request to waive the Medicaid inmate exclusion policy preventing individuals who are incarcerated from receiving care covered through Medicaid. This is particularly relevant given that during the first two weeks after release from a correction activity, the risk of death by overdose among an individual formerly incarcerated is 129 times that of other local residents.
Furthermore, on January 26, 2023, CMS approved California’s request to reimburse select services, including SUD treatment services, for individuals eligible for Medicaid in jails and prisons who are within 90 days of re-entry into the community. Specifically, California Medicaid will reimburse for screening, assessment, and all three FDA-approved OUD medications, in addition to pre-release and post-release services, to support the continuity of OUD care. Pre-release and post-release services include re-entry case management, physical and behavioral health clinical consultation (to diagnose, provide treatment, and support post-release planning), MOUD (all FDA medications), a 30 day supply of medications, and other health care services. On June 30, 2023, Washington became the second state to receive similar approval for pre-release services for justice-involved individuals through their 1115 demonstration. As of August 2023, another 13 other states have proposed similar changes for Medicaid individuals who are incarcerated. Other initiatives, such as the Reentry Act, currently pending before Congress, would expand access to addiction treatment and other health services for Medicaid-eligible individuals who are incarcerated without requiring waiver authority.
“State and federal leaders are building groundbreaking new approaches through 1115 demonstration waivers to expand access to care for people as they leave prison or jail,” said Vikki Wachino, Executive Director of the Health and Reentry Project and Former Director and Deputy Administrator for the Center for Medicaid and CHIP Services. “These new policies may be lifesaving for people returning to communities, including people with mental health and substance use conditions.”
Along with funding opportunities through CMS, Substance Use and Mental Health Block Grants allocated by SAMHSA continue to be an important resource for states to leverage. These funds can be used to comprehensively meet the needs of marginalized populations who may otherwise fall through the cracks of a fractured system of service delivery system. CMS has also issued guidance for state Medicaid authorities to consider when funding programs that address SDOH issues through population health approaches and payment innovation. Each of these funding opportunities can be tremendously helpful, but creating sustainable funding mechanisms that can withstand changes in grant funding and political climate changes will be key to long-term success. As exemplified by a recent publication by the O’Neill Institute for National and Global Health Law at Georgetown, utilizing Medicaid expansion can help states proactively manage socioeconomic and racial disparities through Medicaid. Behavioral health advocates should continue to work with state agencies and legislators in the remaining non-Medicaid expansion states to pursue expansion to help ensure all people with behavioral health needs can access care.