CMS Loosens Medicaid Rules on Mental Health Services Provided in QRTPs

Providing mental health services under the federal Medicaid program has a fragmented and confusing history. In an attempt to address this reality, CMS has just (September 20, 2019) released guidelines to its policies regarding Institutions for Mental Diseases (IMDs) related to treatment in Qualified Residential Treatment Programs (QRTP).

For social agencies and clinics, getting help for the 45 million people in the U.S. with known mental illness can be a chore. In a study published earlier this year, Health Affairs declared “what we have been doing has not worked.” The authors go on to make a case for care coordination and whole-person care:

“Policies are needed that can better integrate mental health comprehensively across healthcare and community settings. Integration is an evidence-based strategy that brings mental health and addiction services more seamlessly into settings like primary care.”

The recent CMS guidance clarification works towards the stated Health Affairs recommendation. Until the change, it was the position of CMS that mental health services were typically the domain of the states as the reason for prohibiting funding. So, Medicaid’s IMD exclusion limited the circumstances under which federal Medicaid funding to states was available for inpatient mental healthcare. Exclusions to Medicaid state funding on mental health services generally prevented adults between the age of 22-65 qualifying for care from Medicaid funding. The definition of an IMD has developed over the years. But today an IMD is defined as an accredited psychiatric facility with seventeen or more beds according to Health Affairs.

1115 Waivers Seen as Care Option

In brief, the new clarification guidelines state:

1: CMS has not decided that all QRTPs will be IMDs; instead, there are several options for states to consider regarding QRTPs. Consistent with current practices, states make an IMD assessment and determination on a facility-by-facility basis according to CMS’s existing statute, regulation, and sub-regulatory guidance. However, now, QRTPs may qualify as IMDs if they are primarily engaged in providing diagnosis, treatment, or care of persons with mental diseases. This includes medical attention, nursing care, and related services in facilities with more than 16 beds. 

2: States may consider an existing section 1115 option to receive Medicaid reimbursement for services to individuals in QRTPs that would be regarded as IMDs. States participating in such a demonstration opportunity are expected to take a number of actions to ensure access to a continuum of care for beneficiaries. It includes measures to improve community-based mental healthcare, in addition to short term stays in IMDs. Also, states will need to improve care coordination and transitions between levels of care and monitor outcomes. There are some limitations, such as room and board expense not covered under an 1115 demonstration exception.

Loosening IMD regulations for QRTPs can expand options for providing services under Medicaid and its primary child population. As Health Affairs noted:

“…as was learned when the policy was made to exclude IMD payments, without community integration and efforts to provide the most appropriate services for the right Medicaid beneficiaries, people could lack the various therapies needed for the most effective treatment…An integrated approach must be thoughtful, comprehensive, and well planned—while recognizing that no single policy will be a “silver bullet.”

Data Platform is Key

Any agency with QRTP services in its community may have a new avenue to provide child behavioral services. Also, repealing long-standing MD Medicaid exclusions can go a long way for localities to respond to substance use disorders (SUD) such as the opioid crises. The Center on Budget and Policy Priorities (CBPP) maintains that any IMD waiver program must be careful to provide community-based care and not create an over-reliance on inpatient treatment programs. Instead, CBPP advocates the use of targeted waivers such as the just-announced QRTP variety.

Specifically, the Health Affairs study authors cite the need for integrated platforms to apply electronic health record technology and telemedicine interoperability to identify and track patients – “to connect the dots.” An example of such a platform is the just-announced PRAPARE SDoH screening tool extension of Eccovia’s ClientTrack Platform. PRAPARE SDoH uses 16 measures to allow community care coordination to treat the whole person, rather than just responding to emergencies. ClientTrack is also is a proven tool in helping manage Medicaid 1115 (and 1915) waiver programs.

Clearly, CMS prefers the 1115 waiver route. As an example, in a previous 2018 waiver cycle, at least ten states obtained mental health waivers. The then Health and Human Services Secretary Alex Azar encouraged more states to apply and that CMS could approve such requests expeditiously.

“[W]e can handle those [discrete SUD waivers] quite quickly,” he told governors at a conference meeting.

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