Alaska looks to move mental services to managed care

Alaska is seeking to improve access to substance abuse and mental health treatment by moving Medicaid beneficiaries who need those services into managed care.

The state posted a waiver for comment Monday and plans to send the proposal to the CMS. It asks that the state be allowed to place people in need of behavioral health services into managed care and that federal Medicaid rules limiting coverage for inpatient mental health and substance abuse treatment in facilities with more than 16 beds to 15 days be waived.

If granted, Alaska hopes the waiver will spark a decrease in inpatient hospital and emergency department care episodes.

Since the creation of Medicaid 50 years ago, the program has excluded payment for institutions of mental disease (IMDs), a classification that includes most residential treatment facilities for mental health and substance use disorders with more than 16 beds.

Thanks to the IMD exclusion, Medicaid beneficiaries suffering from mental illness tend to not get the care they need, according to Mark Covall, president of the National Association of Psychiatric Health Systems. Patients endure long stays in emergency departments and are transferred around from one general acute hospital to another, sometimes far from their homes, because of bed shortages.

If no beds are available at an acute-care hospital, patients are referred to stand-alone psychiatric facilities. Under the Emergency Medical Treatment and Labor Act (EMTALA), those facilities can't deny admission even though they won't be paid due to the IMD exclusion. As a result, these patients are often discharged early and get lower quality care, providers say.

The CMS has expressed a willingness to approve IMD waivers, seeing them as key to battling the opioid epidemic that is now gripping the country.

Alaska is also seeking permission to contract with an administrative services organization, or ASO, to manage the state's behavioral health offerings. Beneficiaries not in need of these services would remain in fee-for-service Medicaid.

"Alaska does not currently possess the capacity necessary to support the system of care envisioned," the waiver application said. "An ASO will provide the specialized expertise to manage a comprehensive behavioral health system and to oversee important provider network capacity development."

The state is still finalizing the exact services to be provided by the ASO. But it is considering allowing it to oversee eligibility verification and enrollment and manage utilization of services.

Alaska officials hope to release a request for proposals for an ASO by February. It will accept public comment on its waiver through Dec. 29.