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1 Noelia Duchovny, et al., Budgetary Effects of Policies to Modify or Eliminate Medicaid's Institutions for Mental Diseases Exclusion 1 (April 13, 2023)

handle is hein.congrec/bgryefcs0001 and id is 1 raw text is: edicaid is a joint federal-state health insur- ance program for people with low income. States administer the program pursuant to certain federal rules and regulations, and the federal government makes matching payments to the states to cover a share of the costs. Under a policy known as the institutions for mental diseases (IMD) exclusion, the federal government does not make matching pay- ments to states for expenditures for services provided to Medicaid enrollees ages 21 to 64 who are in certain types of inpatient facilities. Federal reimbursement is available, however, under several exceptions to the IMD exclusion. States make extensive use of those exceptions. In this report, the Congressional Budget Office estimates the budgetary effects of two options, each with three vari- ants, for expanding federal Medicaid payments for those excluded services. Under current law, states may amend their Medicaid plan and receive federal matching funds through September 30, 2023, for care for Medicaid enrollees ages 21 to 64 with at least one substance use disorder (SUD) in eligible IMDs if several criteria are met.1 Permanently extending that option (referred to as the state plan option throughout this report) would increase federal Medicaid expenditures by $155 million to $560 million, on net, over the 2024-2033 period; the range reflects three alternative specifications of the option that CBO examined. = Eliminating the IMD exclusion would increase federal Medicaid expenditures by larger amounts. Eliminating the exclusion for stays for SUDs would 1. The option was created by section 5052 of Public Law 115-271, the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act. increase those expenditures by $7.7 billion, on net, over the 2024-2033 period; eliminating the exclusion for stays for mental health disorders would increase those expenditures by $33.5 billion, on net; and eliminating it for both types of stays would increase those expenditures by $38.4 billion, on net. Under all of the options that CBO examined, outlays would increase because of greater federal spending for inpatient and long-term care services. Those costs would be partially offset by slightly less spending for emergency department visits. The estimates are uncertain because state-level policy decisions and the prevalence of the dis- orders are difficult to project, among other reasons. Each policy option could affect people's access to care and their ability to afford it, providers' capacity, and the qual- ity of care. A detailed analysis of those effects is outside the scope of this report. Behavioral Health Care for Medicaid Enrollees and the IMD Exclusion In calendar year 2019, about 35 percent of adult Medicaid enrollees had a behavioral health condition, which can include mental illnesses (such as anxiety disor- der, depression, bipolar disorder, and schizophrenia) or an SUD (such as alcohol use disorder and opioid use disor- der). Treatment for those conditions can be provided in outpatient, residential, and inpatient settings. The severity of a person's behavioral health needs, along with other factors, can affect which care setting is most appropriate and how long it is needed. Outpatient care may be used by people who are willing to participate in recommended services, whose living arrangements are stable, who have access to transportation, and who have a supportive social network. Residential treatment can be appropriate for Notes: Unless this report indicates otherwise, all years referred to are federal fiscal years, which run from October 1 to September 30 and are designated by the calendar year in which they end. Budgetary estimates are rounded to the nearest $5 million.

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