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CMS Finalizes Medicaid and CHIP Mental Health and Substance Abuse Parity Rules, Providing Access to Behavioral Health and Vocational Rehabilitation Services

April 29, 2016

The Center for Medicare and Medicaid Services (CMS) has released final regulations on mental health and substance abuse disorder parity for people in Medicaid Managed Care Organization, (MCOs), Medicaid Alternative Benefit Plans (ABPs), and Children’s Health Insurance Program (CHIP) health insurance plans. These benefit plans must now provide mental health and substance abuse disorder benefits that comply with parity standards in the Affordable Care Act (ACA) and Mental Health Parity and Addiction Equity Act of 2008. These benefits include supported employment services for people with psychiatric disabilities, such as Vocational Rehabilitation (VR) or Individualized Placement and Support (IPS) programs. They must also provide the same parity protections for long-term mental health and substance abuse support services that they provide for other long-term support services. 

Health and Human Services Secretary Sylvia M. Burwell said that the rule “eliminates a barrier to coverage for the millions of Americans who for too long faced a system that treated behavioral health as an unequal priority.” The rule will impact the more than 23 million people enrolled in one of the three types of benefit plans it affects, particularly (according to CMS) the percentage of Medicaid and CHIP beneficiaries with significant emotional or behavioral difficulties. Ensuring that there is sufficient and appropriate coverage of mental health services for people with psychiatric disabilities may improve their prospects in other areas of their lives, including employment. CMS, when estimating the impact of this regulation in Section (VI) (C) of their report on the final rule, estimated that increased access to mental health treatment would lead to better employment outcomes for this population.

For more information on the rules change: