Missouri’s Medicaid Waiver Spends More to Provide Less

07.01.2016

Missouri’s 1115 waiver program, named the “Missouri Mental Health Crisis Prevention Program,” was recently submitted to the Centers for Medicare and Medicaid Services (CMS) and is awaiting approval. The goal of Missouri’s waiver is admirable. Unfortunately, this special population waiver program spends more to provide less coverage for fewer people.

Missouri has not accepted federal funds to expand its Medicaid program under the Affordable Care Act, but some are calling this Missouri initiative “Partial Expansion” of Medicaid. That’s not what it is and it’s important to be clear about what the program does, and does not, do.

The Missouri proposal is a limited waiver program that will give some people access to much needed health care. But, as we describe in more depth below, the waiver proposal is very limited in two ways:

Who is eligible—only people with a serious mental illness will be able to enroll.
How many people can be helped—1,000 Missourians per year.

The type of program Missouri wants to operate has been available to states since well before the Affordable Care Act. With this waiver, Missouri still leaves hundreds of thousands of residents without access to affordable health insurance, and leaves nearly $9 billion in available federal funding on the table.

In short, this program bears little resemblance to the Medicaid expansion as envisioned under the Affordable Care Act.

This special population waiver for people with mental illness is not Medicaid Expansion

The special population waiver for people with mental illness carries with it virtually none of the benefits of Medicaid expansion under the ACA. Let’s compare:

Special Population Waiver Missouri Mental Health Crisis Prevention Program	ACA Medicaid Expansion
Will cover 1,000 Missourians who are in a behavioral health crisis	Would cover an estimated 260,000 Missourians irrespective of health status
Will provide a limited benefit package that lacks coverage for inpatient hospital and emergency services, among others	Would provide a full Medicaid benefit package, covering hospital, emergency care, physician care, and other health and mental health treatment
Will cost an average of $12,000 per person the first year, with the state paying $5,000 per person of that cost	Would cost roughly $1,500 per person per year, with the state paying no more than $150 for that coverage
Will bring in $39 million in federal dollars to stimulate the economy over five years	Would bring nearly $9 billion in federal dollars into the state economy over five years
Will not result in state budget savings	Would result in an estimated $348 million in state tax dollars saved over ten years

The waiver falls short, leaving too many Missourians without an option for affordable care

The Missouri Mental Health Crisis Prevention Program is a very limited special population waiver. Such waivers have been a part of the Medicaid program for a long time and are different from Medicaid expansion under the ACA.

The waiver (a Section 1115 waiver) provides a limited benefit package to a capped number of low-income enrollees (1,000 per year) who are experiencing a mental health crisis. This program is funded at the traditional federal matching rate—the state pays for about 40 cents on the dollar and the federal government pays the other 60.

Under a true Medicaid expansion, more people would be covered and the federal government would pay nearly all the costs—from 95 percent in 2017 gradually going to 90 percent in 2020 and beyond.

Missouri and other states have been doing these types of limited, special population waivers for years. They long predate the Affordable Care Act and Medicaid Expansion.

For example, since 1998 Missouri has had a family planning waiver that covers family planning services through Medicaid for poor, uninsured women. And since 1989, the state has offered coverage for certain services through a waiver for low-income people with HIV/AIDS.

Laudable goal, but Medicaid expansion could achieve much more

The Missouri demonstration is laudable in that it seeks to provide help to people with mental health needs before their illness progresses further. Without adequate treatment, mental illness can lead to disability and other costly health outcomes, not to mentioned diminished quality of life.

However, by providing coverage under the ACA’s Medicaid expansion, Missouri could spend less on per person coverage to give 260,000 Missourians access to behavioral and physical health care long before they ever enter a mental health crisis. If Missouri’s goal is truly early intervention, it makes sense to extend health coverage to people before they are crisis.

In addition, full Medicaid expansion could do much more than this limited waiver to address the current opioid epidemic sweeping Missouri. The Mental Health Crisis Prevention Program waiver will intercept individuals in a mental health crisis who present at the emergency room or are referred from a community mental health liaison. Many of these individuals will have a substance use disorder, including opioid addiction.

Unfortunately, the waiver can only accommodate 1,000 enrollees at a time. The need in Missouri for comprehensive substance use treatment far surpasses the scope of this waiver. Medicaid expansion, however, would provide access to treatment and follow up care for thousands of individuals in need of treatment while costing Missouri tax payers less money. And Medicaid expansion would connect people to the health care system earlier. That might mean some people will be able to get help before reaching the point of crisis required for coverage under this waiver to kick in.

Giving Medicaid coverage to more people is a smart idea. Unfortunately, Missouri widely misses the mark by not expanding Medicaid under the ACA. But it’s not too late. The state can make the choice to expand Medicaid at any time.