Abstract

Context: In 2015, the Centers for Medicare and Medicaid Services urged state Medicaid programs to use 1115 waiver demonstrations to expand substance use treatment benefits. We analyzed four critical points in states’ pre-implementation decision-making processes to expand benefits.

Methods: We conducted qualitative cross-case comparison of three states that were early adopters of the 1115 waiver request. We conducted 44 interviews with key informants from CMS, Medicaid and other state agencies, providers, and managed care organizations.

Findings: Policymakers expanded substance use treatment in response to “fragmented” care systems and unsustainable funding streams. Medicaid staff had mixed preferences for implementing new benefits via 1115 waivers or state plan amendments. The 1115 waiver process enabled states to provide coverage for residential benefits, but state plan amendments made other services a permanent part of the benefit. Medicaid agencies relied on interorganizational networks to identify EBPs. Medicaid staff secured legislative support for reform by focusing on program integrity concerns and downstream effects of substance use, rather than the needs of Medicaid beneficiaries.

Conclusions: Decision-making processes were influenced by Medicaid agency characteristics and interorganizational partnerships, not federal executive branch influence. Lessons from early adopter states provide a roadmap for other state Medicaid agencies considering similar reform.

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