CMS approves D.C. Medicaid waiver, paving way for broader mental health coverage

The Centers for Medicare & Medicaid Services approved a Medicaid waiver request from the District of Columbia. (gguy/Shutterstock)

The District of Columbia will be the first market to test a waiver program that aims to allow states to cover more behavioral health services in Medicaid. 

The Centers for Medicare & Medicaid Services (CMS) announced a year ago that it would allow states to apply for Section 1115 waivers that would allow them to circumvent the so-called institutions for mental diseases (IMD) exclusion. The IMD exclusion prevents federal Medicaid funding from covering many inpatient psychiatric services for people with serious mental illnesses. 

Wednesday, CMS announced that D.C.’s waiver request was the first it had approved under the new program. D.C. was also approved for an IMD exclusion waiver for substance abuse disorder treatment, CMS said, marking the 27th such approval. 


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“Today’s historic approval will substantially increase the range of services that are available to meet the District’s Medicaid beneficiaries who are diagnosed with serious mental illness and substance use disorder,” CMS Administrator Seema Verma said in the announcement. 

RELATED: AMA report—Insurers should follow Medicaid’s lead in mitigating opioid epidemic 

“This integrated approach supports the District’s goals of reducing opioid misuse and overdose deaths—while expanding the continuum of mental health and substance abuse treatment options for individuals in need,” Verma said. 

D.C. has been an epicenter of the nationwide opioid crisis, the announcement noted, with the number of opioid-related overdose deaths in the district increasing by 236% between 2014 and 2017. As many people struggling with opioid use disorder also have a comorbid mental illness, the waiver will open new doors for the city to address opioid addiction, CMS officials said. 

In addition, the waiver will open new avenues for D.C. to address homelessness, as many people who struggle to maintain housing suffer from a behavioral health condition, they said.

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