Substance Abuse Treatment:

Medicaid Allows Some Services but Generally Limits Coverage

HRD-91-92: Published: Jun 13, 1991. Publicly Released: Jul 16, 1991.

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Pursuant to a congressional request, GAO reviewed: (1) the Health Care Financing Administration's (HCFA) guidance to states on substance abuse treatment reimbursable under the Medicaid program; (2) the types of Medicaid substance abuse services available in various states; (3) what barriers existed in obtaining treatment reimbursed by Medicaid; and (4) the level of federal and state spending on substance abuse treatment under Medicaid.

GAO found that: (1) HCFA provided consistent guidance to states on reimbursable substance abuse treatment services; (2) HCFA primarily gave guidance on a one-on-one basis until August 1990, when it issued general guidance on which Medicaid benefits could help persons with drug addition and related problems; (3) HCFA did not maintain data on the type and amount of Medicaid substance abuse services provided by the states; (4) because Medicaid allows states to vary the amount, duration, and scope of services provided, some states made little use of their Medicaid options, while others offered a variety of services; (5) despite the variety of services covered, such multiple barriers as insufficient state funds, provider reluctance to accept some clients, and federal and HCFA policies limiting reimbursement, limited the ability of states to expand their use of Medicaid as a treatment resource; and (6) it was impossible for HCFA and the majority of the states to document the amount they spent on substance abuse treatment services, since there was not a separate category for substance abuse treatment on Medicaid cost reports.

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