Trump Administration to Relax Medicaid Funding Restrictions for Inpatient Mental Health

November 16, 2018

By Ricardo Alonso-Zaldivar

The Trump administration Tuesday allowed states to provide more inpatient treatment for people with serious mental illness by tapping Medicaid, a potentially far-reaching move to address issues from homelessness to violence.

Health and Human Services Secretary Alex Azar made the announcement Tuesday in a speech to state Medicaid directors, a group that represents Republican and Democratic officials from around the country who are confronting common, deeply-rooted social problems.

A longstanding federal law has barred Medicaid from paying for mental health treatment in facilities with more than 16 beds, to prevent "warehousing" of the mentally ill at the expense of federal taxpayers. Azar said states will now be able to seek waivers from that restriction, provided they can satisfy certain specific requirements.

"We have the worst of both worlds: limited access to inpatient treatment and limited access to other options," said Azar, who stressed that inpatient care has to be combined with community-based services.

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