Waiver allows Medicaid funding for addiction-related treatment

The Department of Health and Social Services recently received approval from the Centers for Medicare and Medicaid Services for a waiver amendment allowing the department to use federal Medicaid funding for addiction-related treatment of individuals in substance use disorder treatment facilities known as IMDs.

Delaware was the 25th state to receive approval of the waiver. Previously, federal Medicaid funds could not be used to pay for addiction-related services at institutions for mental disease for individuals ages 21 to 64. Before the waiver, Delaware’s Medicaid program used state funds to pay for addiction-related services provided to Medicaid clients at these institutions.

There are four institutions for mental disease in Delaware that provide addiction-related services: SUN Behavioral Delaware near Georgetown; Dover Behavioral Health in Dover; MeadowWood Behavioral Health near New Castle; and Rockford Center near Newark.

The institutions for mental disease exclusion, which prohibits the use of federal Medicaid funds for care provided to most patients in mental health and substance use disorder residential treatment facilities with more than 16 beds, had been part of Medicaid since its enactment in 1965. Delaware’s waiver applies only to addiction-related services for Medicaid clients.

“We are grateful to CMS for granting us this waiver,” said Dr. Kara Odom Walker, DHSS secretary and a practicing family physician. “In the midst of the opioid crisis we are facing in Delaware and across the country, the IMDs are another resource we can use to better serve our Medicaid clients in need of treatment for substance use disorder.”

DHSS’ Division of Medicaid and Medical Assistance also received approval for an extension of its Medicaid demonstration project, Diamond State Health Plan, along with its waiver amendment. Both approvals are effective through Tuesday, Dec. 31, 2023.

“We are very pleased to have approval of our demonstration waiver and the added SUD expenditure authority,” said Steve Groff, Delaware Medicaid director. “This will allow all Medicaid beneficiaries in Delaware to have access to high-quality SUD care.”