Medicaid Expands Role in Addiction Treatment after the Affordable Care Act

Background. The Affordable Care Act (ACA) has prompted sweeping changes to Medicaid, including expanding insurance coverage to an estimated 12 million previously uninsured Americans, and imposing new parity requirements on coverage for behavioral health services, including addiction treatment. Yet, it remains unclear if these changes have reduced the number of uninsured in addiction treatment. This article links findings from a nationally-representative study of addiction treatment programs and a unique national survey of state Medicaid programs to capture changes in insurance coverage among addiction treatment patients after ACA’s implementation.

Methods: Data come from two sources, both collected as a part of the National Drug Abuse Treatment System Survey. First, we collected data from 524 outpatient addiction treatment programs through a nationally-representative, 90-minute internet-based survey conducted in 2013 and 2017 (response rate: 86% in each wave). Second, we conducted a 15-minute, internet-based survey of Medicaid agencies in all 50 states and D.C., also in 2013 and again in 2017 (response rate: 92% in each wave). The survey included questions regarding Medicaid agencies’ addiction treatment benefits and utilization controls. Data from both surveys were merged for analysis.

We assessed changes in outpatient addiction treatment across two outcomes: the percentage of patients who were covered by Medicaid in the most recent fiscal year, and the percentage of patients who lacked insurance coverage for addiction treatment in the most recent fiscal year. We conducted a difference-in-difference analysis to compare changes in outcomes in states that did and did not expand Medicaid before and after the expansion occurred, controlling for organizational- and state-level covariates. We used a censored regression specification to account for left- and right-censoring of the dependent variables, and state-level random effects to account for unmeasured differences between states.

 

Results. In states that expanded Medicaid, the mean percentage of patients with Medicaid per treatment program increased from 25.9% (95% CI: 21.0, 30.8) to 43.4% (95% CI: 37.6, 49.3). We observed a nearly identical offsetting change in the percentage of patients who were uninsured, which decreased from 35.3% (95% CI: 30.4, 40.3) to 16.0% (95% CI: 13.3, 18.6). We observed no significant changes in coverage among patients in non-expansion states. In multivariate analysis, Medicaid expansion was associated with a 16.5-point (95% CI: 4.6, 28.4) increase in the percentage of patients insured by Medicaid in addiction treatment and a 13.7-point (95% CI: -22.7, -4.8) decrease in the percentage uninsured. Each addiction treatment benefit subject to annual service limits was associated with a 2.2 point (95%  CI: -4.3, -0.5) reduction in the percentage of patients in treatment covered by Medicaid.

Conclusions. The findings of this study suggest that the Medicaid expansion has played an important role in reducing the number of uninsured patients and increasing Medicaid covered patients receiving care in the specialty addiction treatment sector. Treatment programs in states with subject to greater restrictions on addiction treatment benefits utilization served fewer Americans covered by Medicaid. Overall, our findings highlight the important role of Medicaid benefits and eligibility design in increasing insurance coverage for addiction treatment.