State Strategies for Addressing the Behavioral
Health Needs of the Medicaid Population
Introduction
On April 21 and 22, 2015, the National Governors Association held a two-day meeting of state officials to discuss
how states are transforming their health care systems. This paper provides an overview of the session focused on
addressing the behavioral health needs of Medicaid beneficiaries, which featured a presentation1 and associated
panel discussion among state and federal officials.2
Key Goals
The goal of the session was to provide states with practical ideas about how to better treat Medicaid beneficiaries
with behavioral health needs, particularly those with severe mental illness (SMI) and related challenges such as
homelessness and incarceration.
Challenges, Strategies, and Solutions
Panelists identified the following challenges for individuals with SMI:
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They are both over-utilizers (for example, frequent emergency room visits) and under-utilizers (for example,
not receiving necessary behavioral health services) of care;
They represent a complex population that often faces homelessness or incarceration;
They have high rates of dual diagnoses of substance use and mental health disorders;
Their physical comorbidities often go unaddressed, contributing to their markedly shorter lifespans;
There is poor coordination among systems of care and weak connections between jails and prisons and social
service agencies; and
Privacy and confidentiality are concerns for this population given the sensitivity of their personal data.
Federal and state laws and regulations create protections that are important but often difficult to navigate.
The panelists identified a number of strategies and solutions, including:3
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New federal legislative options, grant opportunities, and resources.
o Improvements to Section 1915(i) Medicaid state plan amendments (SPAs) that allow states to better
target Medicaid services such as rehabilitation, habilitation, and targeted case management to people
with SMI.
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Linda Elam, “Thinking Creatively: Examples of Successful Delivery Models for High-Need Behavioral Health Patients,” National Governors Association, April 21, 2015, http://www.nga.org/files/live/sites/NGA/files/pdf/2015/1507HealthPresentation3BehavioralHealth.pdf.
2
Panel participants include Sandra Wilkniss, NGA Center; Linda Elam, U.S. Department of Health and Human Services Association; Nathan Checketts, Utah Department of Health; Charissa Fotinos, Washington State Health Care Authority; and Lucia Savage, Office of the National Coordinator
for Health Information Technology.
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During this session, Linda Elam, Deputy Assistant Secretary in the Office of the Assistant Secretary for Planning and Evaluation (ASPE) at the U.S.
Department of Health and Human Services, presented a number of findings from a draft ASPE report, which has not been released yet. The report
will address practical strategies used in four states to improve care for beneficiaries with behavioral health needs.
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National Governors Association
o A new section 2703 health home option that allows states to seek SPAs to provide comprehensive
care management and care coordination to Medicaid beneficiaries with chronic conditions. The health
homes must integrate primary, acute, behavioral, and long-term services and supports.
o A new section 223 demonstration program for certified community behavioral health clinics provides
funding for up to eight states to expand community behavioral health services. The Substance Abuse
and Mental Health Services Administration will award planning grants to 16 states in the fall of 2015.
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Practical state-level strategies.
o Establish regular and ongoing communications between Medicaid and corrections agency staff. For
example, the District of Columbia has established regular meetings among officials from the two
agencies.
o Use Medicaid to provide case management services, allowing for stronger links with housing and
social services. For example, Iowa used targeted case management services to help people with intellectual disabilities, chronic mental illness, brain injury, serious emotional disorders, or developmental
disabilities gain access to medical services and interrelated social and educational services.
o Engage behavioral health and substance use disorder (SUD) providers who are not traditionally part of
Medicaid managed care networks. Texas, for example, added an SUD benefit for adults and required
its managed care organizations (MCOs) to ensure an adequate network of providers offering adult SUD
services.
o Recognize that a different strategy could be needed for a small subset of people who will require a
highly individualized response and more intensive care. For example, the District of Columbia designed
care coordination initiatives for individuals with less intensive behavioral health diagnoses, rather than
for the group of individuals who needed highly specialized services.
o Tackle the need for investments in social services by clarifying that MCOs are permitted to make such
investments (for example, to purchase a refrigerator for food) if they determine it is cost-effective to
do so. Utah has taken that approach, allowing MCOs to provide social services to beneficiaries that
directly affect their health. (Participants, however, noted that actuaries generally cannot recognize such
costs when updating MCO payment rates in the future and that it is important to raise the issue with the
Centers for Medicare and Medicaid Services to collectively identify potential solutions.)
o Empower individuals through employment. Iowa is working toward the alignment of resources and
services for empowering individuals through employment. Those efforts are consistent with evidencebased practices that demonstrate the positive benefits of providing vocational services that assist
individuals with severe mental illness to find and retain competitive jobs in their communities.
King County in Washington has been convening a Familiar Faces group, which consists of representatives
from health clinics, social services providers, and jails who all work with the same individuals as they cycle
between homelessness and jail. The effort has helped the county identify overlapping and poorly coordinated
case management systems and improved communication among the relevant players.
The National Governors Association would like to thank the Robert Wood Johnson Foundation and The Commonwealth Fund for their
generous support for this meeting.
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