Medicare mental health proposals expand help for substance abuse

America’s opioid crisis and the Covid pandemic have renewed calls from lawmakers and advocates to modernize and expand Medicare coverage for behavioral health. And the Biden administration is listening.

The proposed 2023 Medicare physician fee schedule rule suggests changes to Medicare coverage for mental illness and substance use disorder treatment are coming when the final rule is published. Expected next week.

An estimated 1.7 million Medicare beneficiaries had a substance use disorder in the past year, according to a recent study. And although they were much more likely to have experienced severe psychological distress and suicidal thoughts, only 11% received treatment. The problem is not new.

Medicare does not cover the full range of services, providers, and treatment settings for substance use disorders, or “SUDs.”

That “effectively precludes coverage” for substance use disorder treatment in intensive outpatient programs, specialized outpatient addiction clinics and residential addiction programs, according to a recent study. Medicare also does not allow billing by the addiction specialists who dominate the SUD treatment workforce: licensed counselors, certified addiction counselors, and peer counselors.

And because the Mental Health Equity and Addiction Justice Act does not apply to Medicare, the program is not required to offer substance use and mental health benefits at the same level as benefits for medical and surgical care. That’s in stark contrast to most private and work-based health insurance — and even Medicaid plans — that are covered by the law.

Attention from legislators, regulators

As deaths from Covid-19 and opioid overdoses rise, gaps in Medicare coverage for behavioral health services are drawing renewed attention from regulators and lawmakers.

Last month, the House Ways and Means Committee marked up six bills aimed at strengthening Medicare mental health coverage. Last week, Senator Richard Durbin and Congresswoman Lauren Underwood, both Democrats from Illinois, called on Medicare to act “swiftly and comprehensively” to “explore ways to expand access to residential substance use disorder services provided by treatment programs that offer evidence-based care.”

The Biden administration is also looking into the issue. Buried in Medicare’s 2,000-page proposed rule, the Centers for Medicare & Medicaid Services is seeking feedback on whether a “gap” in Medicare’s coding and payment mechanisms “could limit access to necessary levels of care to treat a mental health or disorder, substance use treatment, including and especially substance use disorders, for Medicare beneficiaries.

“We are particularly interested in the extent to which potential gaps would be best addressed by creating new” billing codes or “revising certain billing rules for certain types of care in specific settings,” the proposal said.

The agency also asked whether other coding adjustments were needed “to better reflect the relative resource costs associated with providing intensive outpatient mental health services.”

Continuum of care

Intensive outpatient mental health services are part of a “continuum of care” developed by the American Society of Addiction Medicine. Medicare now covers only the least intensive types of treatments on the continuum: early intervention and outpatient services, along with the most intensive type: inpatient services, said Deborah Steinberg, a health policy attorney at the Legal Action Center, a nonprofit legal and policy organization. .

Adding Medicare coverage for “intensive outpatient” services — which includes nine to 19 hours of treatment services per week — would fill a major void in the program’s current coverage offerings, she said.

“It’s a little more intensive than someone just getting weekly counseling, but not to the level of someone in residential treatment.” And that’s something we’re very confident CMS can do on its own without needing congressional approval,” Steinberg said.

CMS does not comment on proposals during the rulemaking process.

People in intensive outpatient programs for substance use disorders receive an individualized treatment plan, individual and group counseling, medication management, family therapy, and participate in educational groups and occupational and recreational therapy.

Intensive outpatient services

On another front, Rep. Judy Chu (D-Calif.) introduced HR 8878, which would create a Medicare benefit category for intensive outpatient services.

At a recent hearing in the House Ways and Means Committee, Chu’s bill was passed favorably out of committee. Chu, a psychologist, told the hearing that Medicare applies significant restrictions — such as requiring beneficiaries to be eligible for inpatient care — before it covers intermediate treatment services for enrollees with substance use disorders.

“This has the unintended consequence of excluding many Medicare patients from the type of mental health services most appropriate for their condition and level of care,” Chu testified. “This is one of many glaring gaps in the Medicare program that prevents mental health coverage from being on par with physical health.”

Chu’s legislation would allow outpatient hospitals, community mental health centers, rural health centers and federally qualified health centers to provide intensive outpatient services so that “patients can access care at the facilities that best meet their needs.” , she said during the hearing.

Rep. Adrian Smith (R-Neb.), a co-sponsor of the bill, said during the hearing that he “hopes to see its eventual passage into a larger bipartisan mental health package before the end of the year.”

The savings can offset the cost of changes

It would cost about $928 million a year to provide intensive outpatient coverage to more than 116,000 beneficiaries with a substance use disorder, according to a study by RTI International, a nonprofit research institute in partnership with the Legal Action Center.

Adding nearly 76,000 residential treatment stays would cost $935 million, and nearly 59,000 counseling sessions would cost another $66 million, the study estimated.

But those costs would be nearly offset by savings of about $1.6 billion a year in costs for drug-related illnesses, hospitalizations and emergency room visits, the study estimated.

Of the 1.7 million beneficiaries with SUDs, about 77% struggled with alcohol use, 16% with prescription drugs, and 10% with marijuana use. Forty-one percent cited lack of motivation as a reason for not seeking treatment, 33% were concerned about what others might think, and 24% identified logistical barriers, such as transportation.

The SUPPORT for Patients and Communities Act of 2018 created a new benefit category that, in 2020, allowed Medicare to cover opioid treatment programs that provide methadone and other drugs that treat opioid use disorder.

But of the more than 1 million beneficiaries with an opioid use disorder in 2021, fewer than 20 percent received medication to treat it, the Department of Health and Human Services’ Office of Inspector General reported in September. “This low proportion may indicate that beneficiaries have challenges accessing treatment,” the OIG brief said.

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