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Federal approval secured to increase substance use disorder treatment

Treatment paid for through HEART Fund

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News from the office of Governor Gianforte

HELENA — Together with Department of Public Health and Human Services (DPHHS) Director Adam Meier, Governor Greg Gianforte announced on July 6 the state is significantly increasing access to substance use disorder (SUD) treatment for Montana Medicaid members through the Healing and Ending Addiction through Recovery and Treatment (HEART) Fund. 

“Our HEART Fund fills gaps to provide for a full continuum of substance use prevention and treatment programs for communities,” Gov. Gianforte said. “For too long, Montanans have struggled to receive timely access to treatment due in large part to the limited number of beds. With this approval, more people will have access to treatment when they need it most.”

The federal approval, made possible through the governor’s HEART Fund, allows larger licensed SUD treatment providers to receive Medicaid reimbursement for short-term acute inpatient and residential stays at facilities that meet the definition of an institution for mental disease (IMD). 

Introduced by the governor during his first week in office as a central component of his budget, the HEART Fund invests $25 million per year to provide for a full continuum of behavioral health and treatment programs for communities.

Until now, Medicaid patients have had to wait to receive treatment until a Medicaid-eligible bed at a smaller facility became available.

Federal law prohibits Medicaid payment to any IMD facility with 17 or more beds that provide substance use or mental health treatment. However, at the direction of the governor, DPHHS applied for and secured a waiver from the Centers for Medicare & Medicaid Services to drop this prohibition, which is commonly known as the “IMD exclusion.”

“The ability to bill Medicaid will increase capacity for substance use disorder treatment in Montana,” Meier said. “Access to treatment is vital, and now hundreds more Medicaid recipients will be able to receive this critical service.”

The approval is a major step forward in helping the state address its serious public health crisis in SUD, including alcohol abuse, methamphetamine use, and opioid abuse and overdose.

Director Meier said there were several reasons why DPHHS sought permission from CMS to fill this critical gap in the state’s system. The primary reasons include the ongoing challenge of waitlists for this level of care due to an insufficient number of beds available for patients covered by Medicaid, Montana’s current SUD crisis, and the need for increased capacity to help stabilize patients prior to receiving community-based treatment.

Rimrock Foundation CEO Lenette Kosovich said this approval opens a needed pathway to treatment.

“This is a game changer,” Kosovich said. “Until now, we’ve been limited in the number of Medicaid members that we’ve been able to serve, despite an increased demand for treatment.”

While the overall statewide impact of this waiver will be realized over time, Rimrock estimates they will be able to scale up to serve an additional 350 Medicaid members annually.

Kosovich said these services are focused on stabilizing a person with a SUD in a structured 24-hour setting. Once stabilized, the patient is then able to step down to community treatment where they continue to receive support services to aid in their ongoing recovery.

To receive services in a facility, individuals must first have an SUD assessment completed in their community and a clinical determination that inpatient care is necessary. Before Montana secured a waiver from CMS, Medicaid members would then have to wait until one of the few beds accepting Medicaid patients became available, oftentimes several weeks later.

As part of the conditions for federal approval of this waiver, the state must commit to improving community-based outpatient mental health and SUD treatment, including transitions to community-based care following inpatient treatment.

The waiver also asks for federal approval of Medicaid coverage for additional community-based treatment and recovery services, including evidence-based stimulant use disorder treatment models, housing supports, and pre-release care management for individuals in the 30 days prior to their release from a correctional setting. DPHHS and CMS continue to work toward approval of these components of the waiver application.

If any Medicaid members have questions about this particular service, please call Isaac Coy of DPHHS Behavioral Health and Developmental Disabilities Division at 406-444-7922.


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