Despite Obamacare mandate, a dated federal law limits the number of beds available for drug and alcohol treatment via Medicaid

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The Affordable Care Act, which promises sweeping changes to help millions of people with drug or alcohol addiction, requires that treatment be offered to those who are newly insured through the insurance exchanges or Medicaid, the government health plan for the poor and disabled.

"This is the beginning of substance abuse disorders being part of mainstream health care," said Thomas McLellan, former U.S. deputy drug czar and now chief executive officer of the Treatment Research Institute in Philadelphia.

Serious impediments to widespread access remain, including a federal Medicaid law that limits available beds nationwide, say treatment experts and government officials.

"We don't have enough capacity right now," said Becky Vaughn, executive director of State Associations of Addiction Services in Washington.

More than 23 million Americans needed treatment for an alcohol or drug problem in 2012 but only 11% received it, according to estimates from the federal Substance Abuse and Mental Health Services Administration (SAMHSA).

Under the decades-old federal restriction, drug treatment centers with more than 16 beds can't bill Medicaid for residential services provided to low-income adults. The measure was designed to prevent Medicaid funding from going to private mental institutions to avoid warehousing of mental patients.

Drug rehabilitation centers are turning away new Medicaid beneficiaries who are entitled to treatment under Obamacare.

"The unintended consequence is that you are discriminating against an adult who needs help," said Elizabeth Stanley-Salazar, a vice president at the Phoenix House, which offers drug treatment in a dozen states, including California, Florida and Virginia. "We don't do that for any other illness or disease."

A 'DUMB' RESTRICTION

Health officials and treatment centers have raised concerns about the restriction.

In a letter to the Centers for Medicare and Medicaid Services last month, Toby Douglas, California's Health Care Services Department director, said just 10% of the available inpatient beds in the state are in facilities that meet the federal government's size restrictions. He asked the federal government to give the state some flexibility in counting beds.

Similarly, the vast majority of the substance abuse treatment in Colorado is located in centers with more than 16 beds, said Arthur Schut, chief executive officer of Denver-based Arapahoe House. There are ongoing conversations among treatment providers statewide about how to legally get around the restriction so they can offer the newly available benefits to more people, he said.

"Everyone is in agreement about how dumb this is," he said. "It doesn't work economically, and it doesn't work for the people seeking treatment.

There are no plans to change the law, said Suzanne Fields, a SAMHSA senior adviser on health care financing. The federal government is working with states on other options, including treating patients under programs paid for with other federal money.

Fields said federal health officials are meeting with insurance providers and trade groups to supply information and help them ease the transition to the new system of expanded benefits.

In addition to the protections under the Affordable Care Act, long-awaited rules for another federal law — the Mental Health Parity and Addiction Equity Act — were released late last year requiring that coverage for substance abuse and mental health treatment not be more restrictive than other medical coverage. Insurance companies can't have different rules for co-payments or visit limits for substance abuse or other behavioral issues than for medical issues.

Even so, some of the changes have been slow to take root, and despite the new coverage and protections, treatment centers still fight with insurance plans over how long they can keep patients in care.

"There is that natural tension between a payer and a provider that continues," said Les Sperling, chief executive officer of the Central Kansas Foundation.

At the Impact Drug and Alcohol Treatment Center in Pasadena, Calif., administrators said they constantly are trying to persuade insurance carriers to pay for longer stays. "We have to paint a picture for the insurance companies of this sick person who needs a lot more help," said Mark Paquet, admissions director.

'IT TAKES A LONG TIME'

Take Jessica Schabel, 19, from Yucaipa, Calif., who is covered through her parents' plan. Her insurance benefits ran out after 30 days of addiction treatment, but administrators could not get her treatment extended. The facility paid for her to stay an additional 30 days.

Schabel started using heroin and methamphetamine when she was 15, a habit she says she supported by selling drugs. She dropped out of high school and was arrested numerous times.

"For people who have used for years, it takes a long time to break that habit," she said.

Despite all the unanswered questions and obstacles, the new benefits are a relief for those covered under Obamacare, said Tom Delegatto, executive director of business development for the Gateway Foundation in Illinois.

"Nobody is jumping for joy when they have to go into substance abuse treatment," he said. "But they are grateful to have the ability to pay for it. ... They have an opportunity they did not have before."

Kaiser Health News is an editorially independent program of the Kaiser Family Foundation

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