Modernizing Substance Use Disorder Coverage in Medicare: Innovative Policy Proposals

Approximately 1.7 million Medicare beneficiaries have a substance use disorder (SUD), according to the National Survey on Drug Use and Health 2015-2019, yet only 11% received any treatment within the past year. One of the most commonly reported reasons that these beneficiaries did not receive SUD treatment – particularly beneficiaries 65 and older – was because of financial barriers, including insurance not covering treatment. In recent years, Medicare has taken important steps to expand coverage, especially for opioid use disorder. Nonetheless, Medicare’s coverage of SUD treatment is strikingly limited and out of sync with evidence-based treatment models and the current care delivery system. Medicare lacks coverage for the full continuum of services based on ASAM Criteria as well as the providers, and settings that that are needed for treatment. Specifically, Medicare only covers early intervention, outpatient services, and inpatient treatment (ASAM Levels 0.5, 1, and 4), but fails to cover the intermediate levels of care (ASAM Levels 2 and 3). As a result, Medicare beneficiaries cannot receive the most appropriate care in the least restrictive setting, resulting in many individuals getting inadequate, if any, treatment until their conditions become acute enough to require hospitalization.Although Medicare is usually the standard-setter in the health care delivery and payment system, these SUD services, providers, and settings are actually more readily accessible through Medicaid, qualified health plans, and employer-sponsored insurance. This means that many individuals lose access to their treatment and trusted providers when they become eligible for Medicare, absent other insurance coverage. Furthermore, while these other types of insurance must comply with the Mental Health Parity and Addiction Equity Act, Medicare is not subject to this critical civil rights law that protects people with SUD and mental health conditions from discrimination. COVID-19 has dramatically increased the need for SUD and mental health care across age groups. In 2020, our country had the highest number of overdoses to date. The gaps in Medicare coverage place our most vulnerable individuals at grave risk for increased, yet preventable, illness and distress. Renewed interest in Medicare expansion to ​help meet the health care needs of those without adequate insurance coverage also calls for an examination of the shortcomings in Medicare coverage and reform to cover the full continuum of SUD care. In this presentation, we will analyze new research from the National Survey of Drug Use and Health (2015-2019) which provides insights into the prevalence of treated and untreated SUD among Medicare beneficiaries to clarify misperceptions about the need for SUD care among older adults and people with long-term disabilities. We will explain what Medicare covers, including recent policy changes; where gaps remain; and why systemic reform is needed to improve access to substance use disorder care in the community. We will identify the effect of Medicare gaps on patient care, models for reimbursing SUD services not currently covered, and areas for provider involvement in advocating for these necessary changes to meet the growing demand for SUD treatment for Medicare beneficiaries.