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Medicaid Expansion Can Help Reduce Behavioral Health Problems

Expanding Medicaid significantly helps states address problems resulting from behavioral health conditions, including substance use disorders and serious mental illness, in multiple ways, a new Department of Health and Human Services (HHS) report shows:

  • By reducing the unmet need for mental health and substance use disorder treatment;
  • By improving health outcomes;
  • By improving state and local behavioral health programs without new costs; and
  • By reducing costs for state and local governments and state economies from behavioral health problems.

The report includes state-specific data on adults with behavioral health conditions who could benefit from the expansion, and the numbers are significant.  Nationally, an estimated 1.9 million low-income uninsured people with a behavioral health condition lived in non-expansion states, and had income in the Medicaid range, in 2014.  That’s 28.4 percent of the people who could benefit from Medicaid expansion.

The report explains how states that expanded Medicaid have significantly expanded their behavioral health treatment programs, which states historically have funded, with more than $44.2 billion spent on mental health and substance use disorder treatment in 2012.  Enrolling people with behavioral health conditions in Medicaid frees state and local funds previously used to provide treatment to uninsured state residents.  States can reinvest these funds in prevention and early intervention programs or in housing and other supportive services that Medicaid doesn’t cover.  Overall, Medicaid expansion increases the capacity of behavioral health care programs and makes them more effective in providing treatment and other necessary services.

States can also save money in their criminal justice systems, because significant numbers of adults in jails and prisons have behavioral health problems.  Making sure ex-inmates are enrolled in Medicaid when they leave jail or prison can reduce recidivism by ensuring that they can get treatment for substance use disorders and mental illness.  Washington, which expanded treatment for people involved with the criminal justice system with state funds before health reform, found that it saved almost $3 in criminal justice costs for every $1 invested in treatment.

The benefits go beyond increasing state and local government capacity to provide behavioral health treatment.  Workers make productivity gains.  The report cites research finding that average sick days from depression exceed sick days for common physical health conditions such as hypertension, back problems, diabetes, and heart disease.  Treatment saves employers money by reducing absenteeism.

The Senate recently voted in bipartisan fashion to support treatment for people affected by the opioid epidemic.  State policymakers should do the same and expand access to behavioral health treatment through Medicaid.