Public Comment to the Ohio Department of Medicaid
Ohio Medicaid 1115 Demonstration Proposal for Substance Use Disorder Treatment 

The Center for Community Solutions

November 21, 2018


As a nonpartisan think tank actively engaged in the development of sound, cost-effective Medicaid and behavioral health policy, The Center for Community Solutions welcomes the opportunity to provide public comment on the Ohio Department of Medicaid’s (ODM) proposed 1115 demonstration for substance use disorder (SUD) treatment.[1] Community Solutions recognizes the need for the state to seek waiver authority to ensure that Ohio Medicaid’s recently restructured behavioral health benefit remains compliant with federal restrictions that limit Medicaid’s ability to pay for residential treatment. Federal law has long prohibited Medicaid from paying for behavioral health services provided in residential facilities with more than 16 beds, often called “institutions for mental disease” (IMD). In recent years, the Centers for Medicare and Medicaid Services (CMS) have issued guidance allowing state Medicaid programs to pay for short-term stays in IMDs via managed care contracts,[2] along with additional guidance for states to seek waiver authority to circumvent the IMD exclusion.[3] Ohio now joins 27 other states that have submitted IMD waivers for SUD treatment, including 17 that have already been approved.[4]

Federal law has long prohibited Medicaid from paying for behavioral health services provided in residential facilities with more than 16 beds, often called “institutions for mental disease”

While Ohio’s demonstration proposal represents a continuation of the policies initiated through the state’s Behavioral Health Redesign, this waiver will serve as a more formal contract between the state and CMS to define Medicaid’s ability to pay for services provided in IMDs. IMDs have long been an area of uncertainty for Ohio Medicaid providers and beneficiaries, even after the implementation of Behavioral Health Redesign. The 1115 proposal provides an opportunity for ODM to establish complete transparency around Ohio’s IMD policy. ODM can do this by releasing a complete implementation plan for this demonstration project, developed with robust stakeholder input. Although an implementation plan is required by CMS prior to approval of all 1115 waivers, the plan is not required to accompany the waiver application at the time of submission. Because ODM has yet to release its implementation plan, there remains a degree of uncertainty around the precise implications of the proposal for the behavioral health system in Ohio. The Center for Community Solutions proposes several recommendations, outlined below, for ODM to consider in its implementation plan to promote performance evaluation, quality, and data transparency in Ohio’s SUD demonstration.

Recommendation 1: Develop an “IMD HEDIS Score” Tied to Performance

The state has made significant efforts to tie the Healthcare and Effectiveness Data and Information Set (HEDIS) into its quality efforts with its contracted managed care plans. Currently, Ohio’s behavioral health measures are tied mostly to mental illness.[5] These measures, where possible, should be amended to include substance use disorder (SUD). What’s more, there are several other HEDIS measures that should be deployed and tied to Ohio’s Pay for Performance (P4P) program.

These measures could include, but are not limited to:


  • Follow-up after emergency department visit for alcohol and other drug abuse or dependence;
  • Medicaid management and care coordination, including transitions of care.


  • Initiation and engagement of alcohol and other drug abuse or dependence treatment.


  • Identifications of alcohol and other drug services;
  • Mental health utilization.


  • Depression screening and follow-up for adolescents and adults;
  • Utilization of the PHQ-9 to monitor depression symptoms for adolescents and adults;
  • Depression remission or response for adolescents and adults;
  • Unhealthy alcohol use screening and follow-up.

Recommendation 2: Create a Certificate of Need Process for IMD Beds
While Ohio is grappling with the opioid crisis, the current landscape of available providers and utilization patterns is largely unknown. What’s more, the increase of availability of these services could provide a perverse incentive for new market entrants to provide services with no incentive to connect back to community-based services. This may have the effect of significantly increased spending and institutionalization.

Like the Certificate of Need process[6] associated with nursing facilities, a data-driven process of “bed allocation” should be developed in a transparent and regularly reported manner for IMD providers

Like the Certificate of Need process[6] associated with nursing facilities, a data-driven process of “bed allocation” should be developed in a transparent and regularly reported manner for IMD providers. Additionally, nursing facilities should either be excluded from providing IMD services or at least be required to forego existing beds intended for consumers of other long-term care services. Recent federal guidance (see Recommendation 4) explicitly prohibits nursing facilities from participating as IMDs in 1115 demonstration projects for treatment of severe mental illness.[7] ODM should seek clarity on whether CMS maintains this policy toward nursing facilities for SUD treatment as well.

Ultimately, individuals with substance use disorders and mental illness should be supported in ways that are oriented toward community-based options and recovery as a matter of civil rights and cost-effective, recovery-oriented care.

Recommendation 3: Create a Public Resource on Capacity, Spending and Utilization and Develop a Working Group to Address Issues

It is important that transparency remains a part of this time-limited demonstration effort. Doing so would not only provide CMS the appropriate resources to evaluate the waiver, but it would empower consumers and policymakers with the data needed address the challenges of a fragmented behavioral health delivery system. These resources should include:

  • Number and location of providers, including their service portfolio listened in a manner consistent with the American Society of Addiction Medicine (ASAM) criteria;  This should be posted online and updated regularly;
  • Spending associated with services provided by general ASAM standard;
  • Information on transitions of care between settings, including the average days between an inpatient level of care and a community-based treatment option;
  • General demographics of the individuals served;
  • Information on health conditions including:
    • Mental health conditions
    • SUD
    • Other chronic diseases
    • Number that have more than one of the above indicators
    • Per member per month cost associated with each category
  • Information submitted to CMS as a part of the terms and conditions of the waiver

In addition to the data outlined, the state should form a working group made up of governmental staff on the state and local levels alongside representatives from the industry and managed care. This group should meet quarterly to review the data being developed and determine ways in which the waiver could be improved. In particular, LeanOhio[8] should be engaged to employ process efficiency tactics when needed, including the development of a process map that outlines the continuum of care expected by the state in its proposal.

Recommendation 4: Provide Clarification on Mental Health Services in IMD Settings by Responding to New Federal Guidance

The proposed demonstration waives the IMD exclusion only for SUD services, following CMS guidance issued in the November, 2017 State Medicaid Directors Letter (SMD Letter).[9] However, in the November 13, 2018 SMD Letter (issued after ODM published its draft proposal), CMS announced a demonstration opportunity for states to seek 1115 waiver authority to provide mental health treatment for short-term residents of IMD with serious mental illness (SMI).[10] CMS offers technical assistance for states who have already submitted an SUD waiver proposal to operationalize the existing waiver with the SMI waiver. In its implementation plan for Ohio’s SUD proposal, ODM should explain if and how it plans to work with CMS to integrate coverage of SMI in an IMD setting into the demonstration project.


Community Solutions recognizes that ODM’s 1115 demonstration proposal for SUD treatment is a necessary and logical next step in Ohio’s modernization and transformation of the Medicaid behavioral health benefit. However, the implementation plan for the demonstration is a complex and important piece of public policy that should establish a comprehensive and transparent framework for the delivery of IMD services in Ohio Medicaid moving forward. This implementation plan should be developed carefully with stakeholder input, and be responsive of recommendations such as those described above.