Report to Congress: Study and Report Related to Medicaid Managed Care Regulation
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Report to Congress: Study and Report Related to Medicaid Managed Care Regulation

As required by section 12002 of the 21st Century Cures Act (P. L. 114-255)
Published: Jan 25, 2022
Publisher: U.S. Department of Health and Human Services, Centers for Medicare & Medicaid Services, Center for Medicaid and CHIP Services, Division of Managed Care Policy
Health Medicaid and CHIP Mental Health and Substance Use Opioids State Health Policy Federal Advisory Services Technical Assistance
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Associated Project

Medicaid and CHIP Managed Care: Tools and Technical Assistance to Support Federal and State Oversight

Time frame: 2012-2023

Prepared for:

U.S. Department of Health and Human Services, Centers for Medicare & Medicaid Services, Division of Managed Care Policy

Key Findings
  • The majority of states that cover inpatient psychiatric or SUD treatment through risk-based Medicaid managed care use the IMD ILOS authority under § 438.6(e) to provide capitated payments to plans for enrollees ages 21 to 64 receiving treatment in IMDs in lieu of covered services.
  • The number of beneficiaries with one or more IMD stay in lieu of covered services in the last 12- month period for which data were available varied widely by state, ranging from fewer than 100 to nearly 50,000.
  • The average number of stays per year among Medicaid managed care beneficiaries receiving treatment in IMDs across states using the IMD ILOS authority under § 438.6(e) ranged from 1.0 to 2.8 stays.
  • In general, state and plan protocols and guidance are focused on ensuring plans and providers establish medical necessity before beneficiaries’ admission to an IMD rather than providing clear guidance on when to choose IMDs over other covered services for specific beneficiaries.
  • About half of states using this authority reported that permitting plans to use the IMD ILOS authority under § 438.6(e) changed the inpatient psychiatric or SUD component of their capitation rate.

Report to Congress addressing state use of federal Medicaid matching funds for capitation payments to managed care entities on behalf of beneficiaries aged 21 to 64 receiving treatment in institutions for mental diseases in lieu of covered Medicaid services if certain conditions are met. The report answers five study topics required by the authorizing legislation, section 12002 of the 21st Century Cures Act. These include questions on the number of beneficiaries served and their lengths of stay, how plans determine whether to use IMD services in lieu of other covered services, and how such use has affected capitation payments.

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