H.R. 5797 allows state Medicaid programs to remove the Institutions for Mental Diseases (IMD) exclusion for Medicaid beneficiaries aged 21 to 64 with an opioid use disorder for fiscal years 2019 to 2023. By removing the exclusion, Medicaid would pay for up to 30 total days of care in an IMD during a 12-month period for eligible individuals. Opioid use disorder as defined in H.R. 5797 includes, but is not limited to: heroin, fentanyl, oxycodone, tramadol and oxycodone. In addition, the legislation requires states to include in their State plan amendment information on 1) How the State will improve access to outpatient care during the State plan amendment period. 2) The process for transitioning individuals to appropriate outpatient care. 3) A description of how individuals will receive appropriate screening and assessment.
Under the Medicaid statute, Federal funding cannot be used to finance care for Medicaid beneficiaries aged 21 to 64 receiving mental or substance use disorder care in a residential facility that has more than 16 beds. When a Medicaid-eligible individual is a patient in an IMD, he or she cannot receive Medicaid coverage for services provided inside or outside the IMD. The Medicaid IMD exclusion is one of the few instances in the Medicaid program where federal financial participation cannot be used for medically necessary and otherwise covered services for a specific Medicaid enrollee population receiving treatment in a specific setting. According to the Medicaid and CHIP Payment and Access Commission (MACPAC), “The Medicaid IMD exclusion acts a barrier for individuals with an opioid use disorder to receive residential treatment, which, depending on an individual’s treatment plan, may be the most appropriate setting for care.”