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The ACA and behavioral health: A look ahead

March 18, 2014
by Brian Albright
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After all the political maneuvering, the technical glitches with, the wrangling in state legislatures over whether or not to accept Medicaid expansion, this much is clear: this year, millions (exactly how many millions isn't clear yet) of Americans will either become newly eligible for Medicaid or will buy insurance plans through state- or federally-run marketplaces. And thanks to requirements within the Affordable Care Act (ACA) and the previous 2008 Mental Health Parity and Addiction Equity Act, many of those will receive coverage for services that were previously unaffordable or inaccessible.

Mental health and chemical dependency services providers, advocacy groups, and state agencies are bracing for an influx of new consumers, many of whom have little or no experience with either Medicaid or private insurance, and who face unique challenges in accessing services.

States that established their own marketplaces (rather than rely on the Federal marketplace model) got an early look at what may be coming. Behavioral Healthcare spoke to stakeholders in three of those states (Kentucky, Washington, and Connecticut) to find out what they've encountered so far, and what may lie ahead.

Cautious optimism

Amid trepidation about the logistics of enrollment and the accessibility of adequate services, there is also excitement and enthusiasm about what the ACA will mean for low-income patients. In Washington State, more than 270,000 individuals have been enrolled in coverage, either through Medicaid expansion or via private plans available on the state’s Healthplanfinder (

Adults who are childless, low-income, or seriously mentally ill “are going from a situation where at best they can't access services until they are in crisis, to becoming Medicaid eligible," says Jane Beyer, assistant secretary of the state’s Behavioral Health and Service Integration Administration. "They get not only a medical benefit, but also a more comprehensive set of mental health benefits. For that population of folks, those under 138 percent of the poverty level, it's access to a whole different level of benefits than they have ever had."

Across the country in Kentucky, the impact of the Affordable Care Act has been just as dramatic. Kentucky is the only southern state that accepted Medicaid expansion and established its own health insurance marketplace. There were an estimated 640,000 Kentuckians (roughly 15 percent of the state's population) without insurance prior to the ACA; Medicaid expansion alone is expected to affect 308,000 of those. The state already had nearly 800,000 Medicaid recipients.

Kentucky suffers from an acute shortage of behavioral healthcare services providers and a limited pot of money to fund consumer care. According to Dr. Allen Brenzel, medical director of the Kentucky Department for Behavioral Health, Developmental and Intellectual Disabilities, the state's 14 community mental health centers (CMHCs) serve roughly 190,000 individuals annually, and about 30 to 40 percent of those people currently don't have a payer source for their care. "We've been limited in funding those without payers and we've really struggled to meet demand," he says.

With the Medicaid expansion, one of the most difficult to serve populations (childless adults that were not previously eligible for Medicaid) will now have coverage options that didn’t' exist before.

"We have never had substance abuse treatment as a covered benefit under our state Medicaid program," Brenzel says. But all that has changed. The benefit package associated with Medicaid expansion  “included a full and robust substance abuse treatment benefit, which will apply to standard Medicaid. That is earth-shattering for us."

In Connecticut, as many as 50,000 uninsured, childless adults could receive coverage via (Medicaid) expansion by 2020. In the meantime, though, the state has reduced funding for some mental health services in anticipation of the expanded share of coverage costs that are to be paid by the federal government, which will match at least 90 percent of costs for those newly covered by the Medicaid expansion. The budget currently under consideration there would provide $5 million in funds for services for the poor (including increased funding for youth services) and some new funding for subsidized housing.

"The budget passed last year made cuts to providers in the funding for uncompensated care," says Luis Perez, president and CEO of the Mental Health Association of Connecticut. "Hospitals and community providers took a fairly large hit. While they are being made whole this year, that is not necessarily something that will carry forward in years to come. We're taking a wait-and-see approach at this point."

"There has been a four-fold increase in the number of phone calls being received, from people looking for help," says MaryAnne Lindeblad, Medicaid Director for the Washington State Health Care Authority. "Keeping up with the demand for information about those who are just entering into the program is a big challenge. We're dealing with a new population that had not been there in the past."