National Alliance on Mental Illness
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Medicaid Funding of Mental Illness Treatment
Medicaid is now the dominant source of funding for treatment and support services for both children and adults living with severe mental illness – currently, Medicaid comprises 50% of overall public mental health spending, a figure that is expected to rise to 60% by 2010. More importantly, Medicaid is a safety net program that is intended to protect the most disabled and vulnerable children and adults struggling with severe chronic illness and severe disabilities such as mental illness.
State Medicaid programs continue to face a severe budget crisis in 2005. NAMI is extremely concerned that the President’s budget proposal for FY 2006 – due to be released on February 7 – will include a renewed effort to either severely restrict, or perhaps even cap, future federal Medicaid matching funds to the states. Such a proposal would have disastrous consequences for individuals and families that depend on Medicaid. In addition, the FY 2006 budget resolution that Congress will take up this spring is likely to include "reconciliation" instructions that call for deep cuts in federal Medicaid matching funds for the states. Finally, NAMI remains extremely concerned about efforts by the Bush Administration to encourage (and in some cases even compel) states to accept fixed future Medicaid payments from the federal government in exchange for greater state flexibility.
Federal Medicaid Reform Could Dramatically Reduce Mental Illness Services
Previous proposals to limit federal Medicaid funding have included efforts to replace the current entitlement program with capped payments to the states or a block grant. While these proposals would grant states greater flexibility, NAMI remains concerned that they would also encourage states to reduce the benefits for both mandatory and optional populations. These proposals – which are expected to come up again in 2006 – would also allow states to states to create separate programs within Medicaid (i.e., with lower benefits, higher co-payments and fewer protections for optional populations). In NAMI’s view, capped federal payments and block grants in Medicaid would result in cuts in eligibility and coverage for both mandatory and optional populations and would be extremely harmful to children and adults living with mental illnesses. These proposals would inevitably threaten the viability of the already fractured public mental health care system.
NAMI remains concerned that capped federal Medicaid payments to the states or major cuts in federal Medicaid matching funds will result in:
Swelling the number of people with mental illnesses who are homeless,
Diagnosing a child’s mental disorder and then denying early treatment, and
Increasing the number of adults and juveniles with mental illnesses who languish in jails, juvenile detention centers and prisons for lack of access to treatment.
Medicaid is a Critical Resource for Mental Illness Treatment Services
NAMI urges Congress and the Bush Administration to remember that:
Improving Medicaid for Vulnerable Beneficiaries With Mental Illness
In addition, NAMI urges Congress and the Bush Administration to support the following:
IMD Exclusion Perpetuates Discrimination
Current federal Medicaid policy bars from coverage all services provided to adults ages 22 to 64 in IMDs (Institutions for Mental Disease) that include psychiatric hospitals and many community-based residential facilities. This policy isolates adults with mental illnesses from all other Medicaid-eligible populations, contradicting the principles of equal treatment and insurance parity for treatment of mental illnesses, and undermining the ability of states to develop comprehensive systems of care. The result is that individuals with mental illnesses who receive services in IMDs are singled out for inferior Medicaid coverage. NAMI urges Congress to repeal the IMD exclusion and to support universal, non-discriminatory coverage under Medicaid for appropriate, effective treatment and services for individuals with mental illnesses.
The FOA Offers Hope to Families of Children with Severe Mental Illnesses
NAMI strongly supports the Family Opportunity Act (S 622/HR 1811 in the 108th Congress), legislation designed to end the financial devastation that families too often encounter in attempting to access quality treatment for their children with severe mental illnesses and other disabilities. This legislation would allow states to offer Medicaid coverage to children with severe disabilities living in middle income families through a buy-in program. Currently, families must stay impoverished, place their children in an out of home placement or simply give up custody in order to secure the health care services their children need under Medicaid.
For more information please contact: Andrew Sperling, Director of Legislative Advocacy at 703-516-7222 or email@example.com