IMD waiver update provided by OHCA

Posted on: 4/10/20

OHA has learned that the Oklahoma Health Care Authority (OHCA) anticipates submitting a Medicaid Institutions for Mental Diseases (IMD) waiver request to CMS on June 3 with an anticipated Oct. 1 effective date. Traylor Rains, OHCA deputy Medicaid director, stated that the public notice and hearings by OHCA will occur in May.

It was previously believed the IMD exclusion waiver would be submitted as a part of the governor’s SoonerCare 2.0/Healthy Adult Opportunity application. OHCA was asked for clarification by OHA earlier this week due to the current pandemic crisis, which creates a more urgent need for the waiver.

The IMD exclusion prohibits the use of federal Medicaid financing for care provided to most patients in mental health and substance use disorder residential treatment facilities larger than 16 beds. The exclusion is one of the very few examples of Medicaid law prohibiting the use of federal financial participation (FFP) for medically necessary care furnished by licensed medical professionals to enrollees based on the health care setting providing the services. The exclusion applies to all Medicaid beneficiaries under age 65 who are patients in an IMD, except for payments for inpatient psychiatric services provided to beneficiaries under age 21, and has long been a barrier to efforts to use Medicaid to provide nonhospital inpatient behavioral health services.

The IMD exclusion is found in section 1905(a)(B) of the Social Security Act. It has been part of the Medicaid program since Medicaid’s enactment in 1965, and while Congress has had the opportunity on numerous occasions to amend or repeal the exclusion, it has remained largely intact. In addition, the regulations governing the IMD exclusion have not been updated since 1988. (Sandra Harrison)