Behavioral Health
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Medicaid is the largest payor for mental health and substance use disorders, and cuts would harm behavioral health care in Ohio

Kyle Thompson
Policy Associate
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May 24, 2025
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May is designated as mental health awareness month. The Center for Community Solutions has written on mental health within the state budget, services like the 988 Lifeline, maternal mental health, and the ongoing need for awareness on the importance of mental health across the state. The Department of Mental Health and Addiction Services (OMHAS) also published a press release on May 6 detailing the significance of having conversations around mental health to improve wellbeing. As Mental Health Awareness month enters its last week, let’s explore the role that Medicaid plays in supporting behavioral health services.

Medicaid is the largest payor for mental health and substance use disorders.

Medicaid supports behavioral health services

For many individuals across the United States, Medicaid is a critical resource supporting health care. Regarding behavioral health, Medicaid is the largest payor for mental health and substance use disorders. Statistically, adults covered by Medicaid tend to have higher rates of severe mental health illness compared to adults with private insurance or no coverage at all. One in three (35 percent) adult Medicaid enrollees have a mental illness, with 10 percent having a severe mental illness. Adults covered by Medicaid receive treatment for mental health at rates substantially higher than individuals with no insurance, and at rates similar or higher than recipients of private insurance.

In 2023, 59 percent of adults enrolled in Medicaid received treatment for a mental illness, much higher than adults with adults with no insurance (37 percent) and adults with private insurance (55 percent).  

How are behavioral health needs in the Medicaid expansion population supported?

In Ohio, Medicaid works through managed care organizations (MCOs) that pay providers who provide health care, including behavioral health care. There are seven MCOs in Ohio. It is a requirement that all health plans offer behavioral health services, including treatment for substance use disorders and mental health.

In 2024, 40 percent, or 314,031 enrollees out of 778,489 total Medicaid expansion population had a primary mental health or substance use disorder diagnosis in Ohio

 The Health Policy Institute of Ohio released a policy brief highlighting statistics of Medicaid expansion enrollees receiving behavioral health treatment. In 2024, 40 percent, or 314,031 enrollees out of 778,489 total Medicaid expansion population had a primary mental health or substance use disorder diagnosis in Ohio. That same year, state and federal expenditures on mental health and addiction totaled $1.1 billion spread across community-based substance use disorder services ($780 million), community-based mental health ($175 million), and behavioral health hospital services ($185 million).  

With regard to substance abuse, Medicaid paid for 45 percent of buprenorphine treatments in the U.S. in 2021-2023, which is substantially higher when compared to other health insurances (18 percent paid by commercial insurance, 11 percent paid by discount vouchers/cards, 11 percent paid by Medicare, and six percent paid by cash).  

Medicaid changes threaten behavioral health support

Throughout the past few months, there have been several threats to Medicaid that have been analyzed and discussed by Community Solutions. Our work has looked at proposed work requirements under Medicaid, and the impact it will have on members of the program, specifically individuals falling under Group VIII, otherwise known as the adult Medicaid expansion population. Most recently, my colleague, Brandy Davis analyzed changes that would impact Medicaid if a federal budget proposal is adopted to change language within Medicaid from “shall” to “may.” This trigger language would in essence require the state to end Medicaid expansion if federal funding for this population drops below the current 90 percent match rate.

The Medicaid trigger would affect well over 770,000 Ohioans, and an estimated 362,000 in rural populations.

What can I do to support Medicaid and mental health?

Despite the threats to Medicaid, providers, advocates, and community members should work together to promote the significance of mental health, emphasizing the role that Medicaid plays in supporting mental health.  

OMHAS released a digital toolkit that can be used by communities, nonprofits, and providers to share vital information on mental health, and its importance. This includes social media shareables with sample posts that can be used to communicate online. The CDC also has accessible data on mental health and more resources, shared below. Community Solutions has county fact sheets looking at the role of Medicaid across Ohio.  

Advocacy is also a crucial part of behavioral health, as it allows for social service organizations, community members, and nonprofits to inform legislators on crucial issues around the state. As the state budget process continues through the Senate, be sure to check 5 Things for regular updates on policy changes and information on when you can provide testimony to make your voice heard. If you are interested in more information on policy changes that have occurred already, check out the webinar hosted by Community Solutions’ policy team on the state budget, as well as our work on proposed changes to Medicaid.

Resources

OMHAS Programs: Know our Programs and Services

NAMI Ohio Local Resources: Local Resources - NAMI Ohio

CDC Mental Health Resources: Mental Health Resources | Mental Health | CDC

Resources for LGBT Population:  

Trevor Project Mental Health Resources: LGBTQ+ Mental Health Resources | The Trevor Project

Mental Health America LGBT Resources: LGBTQ+ Mental Health Resource Center | Mental Health America

Resources for Veterans:  

Ready-To-Use VA Mental Health Materials | Spread the Word - Mental Health

Veteran Mental Health Services | Wounded Warrior Project

Culturally Relevant Resources:  

Modifying Evidence-Based Practices to Increase Cultural Competence: Toolkit

Mental Health in Rural Populations: Mental Health in Rural Communities Toolkit – Rural Health Information Hub  

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