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Mental Healthcare Access - Medicaid, CHIP, Medicare

September 14, 2022

Therapy Coverage

Therapy Practice

By Katie Heilman

1) Mental Healthcare Access through Medicaid and Children’s Health Insurance Program (CHIP)

Government-sponsored health insurance programs, Medicaid and the Children’s Health Insurance Program (CHIP), fill a critical need by providing healthcare coverage to over 90 million Americans. Medicaid and CHIP are similar by design; both are jointly-funded programs administered by states in accordance with federal guidelines. Both programs extend protection to low-income individuals and families. However, Medicaid and CHIP vary in eligibility requirements and coverage.

Does Medicaid cover therapy?

Medicaid is the primary payer of mental health services in the U.S. Low-income adults, children, and those with disabilities are eligible. Federal requirements mandate coverage for specific mental health services, including screening, assessments, and medically necessary inpatient and outpatient hospital stays. As a result, States are left with a great deal of freedom in determining the structure of their Medicaid programs, including financing, coverage, and care delivery models.

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Unfortunately, because of state variance, not all Medicaid programs cover the full continuum of mental health services. However, most Medicaid beneficiaries can access psychiatric services, substance use disorder (SUD) treatment, medication management, outpatient therapy, and even community-based mental health services.

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Mental health coverage for children enrolled in Medicaid is comprehensive, thanks to the Early, Periodic Screening, Diagnosis, and Treatment (EPSDT) benefit. Covering children up to age 21, EPSDT requires states to provide coverage for all behavioral health treatments available under Medicaid federal law, even if services are not covered for adults.

Does CHIP cover therapy?

The Children’s Health Insurance Program (CHIP) was implemented in 1997 to expand healthcare coverage to low-income children whose families do not meet Medicaid income eligibility requirements. Nearly 10 million children are enrolled in CHIP, and some states have expanded CHIP coverage to include eligible pregnant women.

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States can implement CHIP as a supplement to Medicaid or develop CHIP as a stand-alone program. Medicaid limits cost-sharing for mandatory coverage, but unfortunately, CHIP does not. Be aware that you may be responsible for additional charges if your state has established CHIP independent from Medicaid.

How to Apply to Medicaid and CHIP?

A great benefit of both Medicaid and CHIP is that there is no enrollment period, meaning you can obtain coverage immediately after eligibility is confirmed. To apply for Medicaid and CHIP, either:

Fill out an application on HealthCare.gov. If you or anyone in your household qualifies for Medicaid or CHIP, your information will be shared automatically with your local agency for follow-up.

Reach out to your local Medicaid agency directly. Select your state on HealthCare.gov for contact information.

2) Mental Healthcare Access through Medicare

Implemented in 1965, Medicare is the federal health insurance program for Americans age 65 and older. Younger individuals with long-term disabilities may also qualify for Medicare. Unlike Medicaid and CHIP, Medicare does not limit eligibility based on income. Medicare protects over 60 million Americans, providing access to many health services and prescription drug coverage.

What are the Three Parts of Medicare?

Medicare has three parts, each distinct offering coverage.

Part A: Covers hospital and skilled nursing facility stays, hospice, and some home health care.
Part B: Covers certain preventative care, medical supplies, and outpatient services.
Part D: Covers prescription drugs and recommended shots/vaccinations.

Private payers, such as United Healthcare, Anthem, and Aetna, offer Medicare Advantage plans. These bundled “Medicare-approved” plans offer alternative coverage, often with supplementary benefits not provided by traditional Medicare plans. Medicare Advantage plans are subject to federal guidelines. However, out-of-pocket costs, referral requirements, and covered services vary by plan type.

Medicare Part B and Mental Health Services

Mental health coverage falls within Medicare Part B. Part B plans almost always have a deductible, which you are responsible for paying in full before benefits apply. Typically, Medicare will pay 80% of the Medicare-Approved amount of services after your Part B deductible is met. The "Medicare-Approved Amount" is the amount a Medicare-participating provider has agreed to accept for services provided.

Medicare Part B offers mental health coverage for partial hospitalization and outpatient levels of care. Psychiatric evaluation, diagnosis tests, medication management, and individual, group, and family psychotherapy services are covered by Medicare Part B. In cases where a higher level of care is beneficial, Medicare Part A provides coverage for inpatient mental health services. To determine if a specific service is covered, refer to Medicare.gov.

How to find a therapist near you that accepts Medicaid?

Medicare Part B covers mental health services provided by a wide range of clinicians, including psychiatrists, clinical psychologists, social workers, nurse practitioners, and outpatient therapists. You can search for Medicare-participating providers in your area by specialty on Medicare.gov.

Coordination of Benefits for therapy

It’s common for those enrolled in Medicare to have supplemental coverage with a private payer. In this case, it’s important to understand the coordination of benefits. If you have healthcare coverage with more than one insurer, there will be a distinction between the primary and secondary payer. For successful processing, behavioral health claims must first be submitted to the primary payer. After the primary benefits are assigned, the claim will be forwarded to the secondary payer for further benefit determination. You may need to complete a coordination of benefits process with your insurers to determine the primary payer; we recommend doing so proactively to avoid delays in reimbursement.

Becoming a Medicaid or Medicare Provider

It’s a troublesome time for those seeking mental healthcare; demand for services is at an all-time high, provider shortages are nationwide, and financial strains are forcing patients to skip sessions. These factors have brought attention to the dire need to expand access to care. With over 150 million Americans enrolled in government health plans, there’s an overwhelming opportunity to serve a traditionally underserved population by becoming a Medicaid and Medicare-participating provider.

Considerations:

As with anything, there are pros and cons to accepting assignments from Medicaid and Medicare, and critically evaluating the opportunity is essential for the health of your practice. A few things to consider:

Opportunities

Expansive clientele base - the phrase “therapist near me that accept medicaid” is searched for more than 3,500 times a month!
Increased community reach
Affordable service offerings

Obstacles

Lower reimbursement rates
Licensure limitations
Potential for delayed payments

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Becoming a Medicaid or Medicare-participating therapist opens the door to serving an entirely new population within your community. It guarantees your practice will play an instrumental role in expanding access to affordable care, but it also introduces new limitations and challenges to navigate.

Getting Credentialed with Medicaid and Medicare

Medicaid and Medicare are often discussed together, but it’s important to understand these are separate programs, each with a different credentialing process. You can choose whether you will accept Medicaid, Medicare, or both! It’s common for clientele demographics to influence this decision. Because Medicaid and CHIP are state-specific, you’ll need to contact your local Medicaid agency for instructions on becoming a participating provider. Confirm whether Medicaid participation includes CHIP, as this may vary by state.

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There are three steps to Medicare Provider Enrollment. First, you’ll need to obtain a National Provider Identifier (NPI). Then, enroll in PECOS and complete the Medicare Enrollment Application. Once submitted, you’ll be assigned a regional Medicare Administrative Contractor (MAC). Your MAC will process your application, requesting any additional documentation deemed necessary. You’ll receive enrollment updates from your MAC, but you can also check the status of your application here.

How Nirvana Helps

We’re here to help people to access the care they need, the care we all deserve. We view mental health as a human right, not a nice-to-have. We envision a world where anyone can access care, regardless of cost, and we’re dedicated to providing resources to close the gap. Did you know low reimbursement rates are the main barrier preventing therapists from participating with Medicaid and Medicare?

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Low reimbursement rates are the main barrier preventing therapists from participating with Medicaid and Medicare. Though Nirvana cannot support government health plans, our Out-of-Network Reimbursement Calculator and Full Billing Support can be used for all eligible clients, significantly reducing administrative burdens. In addition, when working with Nirvana, you’ll have more time to focus on growing your practice so that choosing to accept Medicaid/Medicare doesn’t have to be such a financial strain!

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We believe controlling cost is key to improving access to this care. Medicare has long advocated for consumer protections such as price transparency and mandatory coverage for basic health services, which alleviates the stress of financial uncertainty when seeking care. This aligns with Nirvana’s mission: mending a broken system and finding solutions for patients and therapists.

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We know that what helps a client doesn’t always benefit a therapist and vice versa. So we’re interested in creating solutions that work for your practice and your clients, all while staying true to our mission of expanding access to care. Nirvana takes the hassle out of insurance so you can focus on what matters most: providing care and growing your practice.

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