The Effects of States' Substance Use Waivers on Healthcare Utilization and Opioid-related Overdoses Among Medicaid Enrollees with Opioid Use Disorder

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Project summary Abuse of opioids is a public health crisis: in 2016, 2.1 million people had an opioid use disorder (OUD) and more than 40,000 people died from an opioid overdose. There is clear evidence that people with OUD can be effectively treated using medication and behavioral interventions such as counseling. Depending on the severity of the addiction, treatment can occur in outpatient settings (e.g., office visits for individual therapy) or might require more intensive care in inpatient settings such as residential facilities or hospitals. However, a large share of people with OUD still do not receive optimal treatment. Medicaid plays a crucial role in addressing the opioid crisis. It covers health care for almost 40 percent of people with OUD, and state Medicaid programs provide a variety of OUD treatment services affecting health outcomes for people with OUD. Some of these benefits are federally mandated (e.g., inpatient or ED services in general hospitals), while others are optional (e.g., medications, case management) and determined by public policy decisions at the state level. However, it is not clear what kind of policies are most successful in reducing the number of opioid overdoses among Medicaid beneficiaries. In 2015, the Centers for Medicare & Medicaid Services (CMS) issued guidance allowing states to receive federal funding to support substance use treatment through Section 1115 Medicaid waivers for “Institutions for Mental Diseases” (IMDs), defined as facilities with more than 16 beds that specialize in mental health or substance use treatment. In the absence of these waivers, federal law prohibits states from using federal matching funds to pay for Medicaid services provided in IMDs. The waivers relax this prohibition, while simultaneously requiring states implement a variety of other changes, including, for example, comprehensive OUD coverage, opioid treatment guidelines and care coordination among providers. Currently, 27 states have received an SUD waiver. This application proposes a comprehensive mixed-methods assessment of the effects of the Medicaid SUD waiver implementation. Our proposal has three aims. First, we use Medicaid claims data to examine the effect of the waiver on health care utilization, including medication use over time (2014-2021) and across states. Second, we assess the effect of the waiver on opioid-related overdoses. Third, we combine quantitative results with qualitative data collection to identify waiver elements and contextual factors that were associated with a successful reduction in opioid-related overdoses. The proposed research will provide critical information to state Medicaid programs about public policies that are most successfully addressing the opioid crisis.