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State Doubles Rate It Will Pay for Medication Management, Key Drug Addiction Service

Decision part of larger battle to stem tide of opioid addiction in New Jersey

recovering drug addict

State officials have doubled the reimbursement rate New Jersey will pay to doctors who provide a treatment that has proven particularly effective with many opiate addicts, the latest adjustment to an ongoing reform of how the government pays for behavioral health services for some of its poorest, most vulnerable patients.

The Department of Human Services, which oversees mental health and addiction programs, told provider organizations last Tuesday that psychiatrists could collect twice as much as they currently do for offering Medicaid patients medication management — a process of regular outpatient checkups for patients who are taking prescription drugs to quell cravings and withdrawal feelings related to opioid use.

The change also supports the state’s growing effort to tackle New Jersey’s epidemic of opiate addiction and came on the same day that Gov. Chris Christie announced the Department of Health would kick off a process to add nearly 900 psychiatric hospital beds, an effort to address a capacity crunch that experts said presents a major hurdle to those seeking to get clean.

The news of a higher medication-monitoring rate was welcomed by nonprofit provider groups who have said larger Medicaid payments are essential if they are going to stay solvent and continue to deliver housing, day programs, and other services to those with mental health and addiction issues. State officials issued a new payment schedule last summer, as part of the payment-reform process, but have tinkered with several key rates after providers raised concerns that the changes would leave them short.

Debra Wentz, president and CEO of the New Jersey Association of Mental Health and Addiction Agencies, called it a “great step forward,” and thanked staff at the state’s Division of Mental Health and Addiction Services for working with her members to protect these safety-net services and those they serve. She said the change “was the result not only of NJAMHAA and many of its members making their voices heard and echoed by other stakeholders, but by those voices being listened to and acted on by our colleagues at the various state offices.”

Christie has heralded the payment reform, in which the state is moving from a system of monthly contracts to a fee-for-service model that pays providers for specific patient treatments, as something long-overdue and promised to commit an extra $127 million — almost all federal funding — to boost payment rates. Historically low Medicaid reimbursement rates, which some doctors complain barely cover costs, are seen as a major hurdle to care, since there is little incentive for doctors to participate in the government insurance program.

But when DMHAS announced the new rates last spring, providers found that — even with an increase to many categories — they would still be left short under the new system and programs for as many as 20,000 patients could be endangered. Leaders of these nonprofit organizations have met repeatedly with DMHAS officials to share their concerns and, in addition to rate adjustments, the state agreed to let some organizations delay their fee-for-service transitions until July 2017, and offered some bridge funding to help ease the shift. But in August, Christie said no more extensions will be granted, insisting New Jersey’s providers need to adopt a format that is now standard nationwide.

Providers have also rallied lawmakers to the cause. In January the Legislature approved a measure (A-4146), championed by Assemblywoman Valerie Vainieri Huttle (D-Bergen), and others, to create a panel to oversee the fee-for-service transition and report back to state officials on the process. Christie has not signed the bill into law.

A number of providers have said the medication-management rates are particularly important. The use of medication-assisted therapy is gaining ground as new, more effective prescriptions are developed and experts better understand how it can help drug addicts reclaim their lives. But under the old rate, some organizations said they were actually losing money every time they offered the management service.

“I can’t do that — I’ll go out of business,” Jim Cooney, chief executive officer with Ocean Mental Health Services, told an Assembly committee in November. At the time, it was overseeing nearly 3,000 clients, and Cooney feared that without higher rates he would be unable to cover physician costs and hundreds of patients would lose out on care.

To address this concern, DMHAS has agreed to raise the payment for medication evaluation and management services from the current $24.63 for ten minutes to $49.06; 40-minute sessions will rise from $81.40 to $161.02, according to a letter the agency shared with providers. Wentz, with NJAMHAA, said the change makes the fee-for-service transition “more viable” for those that provide this service.

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