Opportunities and Challenges Under Medicaid Substance-Use Disorder Treatment System Reform

American Health Lawyers Association

Purvi B. Maniar, a Member of the Firm in the Health Care and Life Sciences and Corporate Services practices, in the firm’s New York office, and Kevin Malone, a Law Clerk – Admission Pending – in the Health Care and Life Sciences practice, in the firm’s Washington, DC, office, authored an American Health Lawyers Association Email Alert titled “Opportunities and Challenges Under Medicaid Substance-Use Disorder Treatment System Reform.”

Following is an excerpt:

An important new effort to effectively serve Medicaid beneficiaries with substance use disorders (SUD) is set to expand significantly in the coming months to Massachusetts, Maryland, Michigan, Virginia, and potentially other states. Last year, the Centers for Medicare & Medicaid Services (CMS) opened up a new opportunity for states to submit demonstration projects under section 1115 of the Social Security Act to test new SUD treatment services and delivery systems. Through the State Medicaid Director’s Letter SMD # 15-003 entitled “New Service Delivery Opportunities for Individuals with a Substance Use Disorder,” (SMD letter) CMS called for states to propose delivery system transformation demonstration programs improving access and quality of care for individuals with SUD. So far, only California is operational but applications from Massachusetts, Maryland, Michigan, and Virginia are under final review at CMS with approval imminent. Additional states are likely discussing informal submissions with CMS.

These new efforts will cause dramatic changes in participating states, presenting many opportunities and challenges for health plans and providers of SUD. In particular, these efforts will require SUD providers to substantially change their clinical and business practices to deliver evidence-based care, adopt improved record-keeping and business practices, and participate in integrated care. For many providers historically reliant primarily on cash or grant-based financing in isolation from other parts of the health care system, this program represents a major change and opportunity to access meaningful federal governmental reimbursement.