Refusing Medicaid Expansion Cuts Mental Health Services

Fran Lowry

August 24, 2015

UPDATED August 25, 2015 // Opting out of Medicaid expansion under the Affordable Care Act will have dire consequences for the provision of mental health services in those states choosing to do so, a new study concludes.

A cost analysis of states' decisions to opt out of Medicaid shows that these states will receive less revenue and have a reduced capacity to serve people with mental illness, according to the study, published online August 17 in Psychiatric Services.

"On-site behavioral health services are needed in federally qualified health centers," lead author Emily Jones, PhD, from the Department of Health Policy and Management, George Washington University, Washington, DC, told Medscape Medical News.

"However, financial constraints might limit the ability of health centers to provide on-site behavioral health services, particularly in states opting out of Medicaid expansion. Our study indicates that opting out would have indirect impacts on safety net capacity, which would mean less access to mental health and substance use specialist staffing in federally qualified health centers," Dr Jones said.

Dr Emily Jones

She and her group examined how state decisions not to expand Medicaid have affected the utilization of behavioral health services in health centers, a key source of medical and behavioral health services in underserved communities because they serve all patients regardless of ability to pay.

"We examined the link between revenues and behavioral health services, since on-site behavioral health services are not required in health centers; only primary care services are required. This makes mental and behavioral health services vulnerable to cuts if there is not enough funding," Dr Jones said.

Using 2012 Uniform Data System data and the projected health center insurance case mix in 2020, the researchers estimated the amount of additional revenue that could accrue to health centers if all 50 states were to expand Medicaid by 2020.

Using the estimated percentage of total revenues supporting the provision of specialty behavioral treatment services, the researchers also estimated the number of encounters with behavioral health specialists that might be possible in 2020 if all states expand Medicaid by that date.

Their calculations showed that if all 50 states expanded Medicaid by 2020, an estimated 70,500 additional encounters with behavioral health specialty staff could occur in federally qualified health centers across the nation in that year.

Further, health centers would accrue nearly $230 million in additional revenue during 2020 because fewer of their patients would be uninsured. An estimated $11.3 million would likely be used for mental health services, and $1.6 million might be used to provide substance use disorder services.

"These results are important since they illustrate some of the potential indirect impacts of state decisions not to expand Medicaid," Dr Jones said.

"In addition to the direct effects ― most notably, higher uninsurance rates ― state decisions on Medicaid expansion can impact capacity in the safety net. Of course, this study provides a very specific example of potential indirect effects. There are many other indirect effects of state decisions not to expand Medicaid," she said.

Medicaid Expansion Crucial to Mental Health

Medscape Medical News invited Arshya Vahabzadeh, MD, from Massachusetts General Hospital and Harvard Medical School, Boston, to comment on this article.

"Medicaid expansion is crucial to the mental health of our country," Dr Vahabzadeh, who was not part of the study, said.

"Not expanding Medicaid prevents low-income people from getting mental health care and leads to many hospitals and communities having to deliver uncompensated care or dealing with the fallout of people who can't get care until their mental health has significantly deteriorated," he said.

Dr Arshya Vahabzadeh

"Even people who have insurance will end up paying more to compensate for the effects. More than four million people fall into this coverage gap; the majority of these live in the south, and almost half will be younger people, age 19 to 34," Dr Vahabzadeh said.

"This is an issue that transcends politics. Sixty percent of states have decided to expand Medicaid, including many states with Republican governors or Republican-controlled legislatures. For every $1 a state invests in Medicaid expansion, $13.41 in federal funds will flow into the state, according to the Robert Wood Johnson Foundation and the Urban Institute," he said.

Meera Sheffrin, MD, from the University of California, San Francisco, School of Medicine and the San Francisco Veterans Affairs Medical Center, added: "These are very interesting findings that have direct policy implications.

Dr Meera Sheffrin

"Doctors cannot fully care for patients without addressing their mental health needs," she said. "This requires dedicated behavioral health services and dedicated funding, and this study shows Medicaid expansion can be one way to help address this critical need."

Dr Jones, Dr Vahabzadeh, and Dr Sheffrin report no relevant financial relationships.

Psychiatr Serv. Published online August 17, 2015. Abstract

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