Medicaid Financing for Behavioral Health Services: The Use of Flexibilities and Authorities

Medicaid is the largest single payer for behavioral health services, and managed care is the predominant delivery system for Medicaid enrollees. However, states have the flexibility to decide if behavioral health providers and their services are reimbursable and subject to same-day billing restrictions. The state-specific nature of the Medicaid program, overwhelming use of managed care organizations (MCOs), and the dominance among waiver programs of the behavioral health waivers calls for attention on state Medicaid Plans, Medicaid MCOs, and Section 1115 waivers to examine payment rates for behavioral health services providers.

This report aims to determine the variation in behavioral health provider reimbursement rates per unit of service under fee-for-service (FFS) and MCO in states with Medicaid waivers for behavioral health, and in non-waiver states, determine if there are fewer behavioral health providers available in Medicaid FFS and MCO programs.

March 4, 2021
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March 4, 2021

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