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Montana Wants To Expand Institutional Mental Health And Addiction Treatment. What’s The Downside?


The Gianforte administration's approach could have sweeping impacts for Montana State Hospital and private providers across the state.

Montana Free Press

Mara Silvers Reporter

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Walking around Rimrock’s 40-bed addiction treatment facility in Billings, CEO Lenette Kosovich says as many as half of the beds could be empty on any given day.

It’s not for lack of need. With about 90,000 Montanans estimated to have a substance use disorder and roughly 10% of those seeking treatment, demand for detox and rehabilitation services is high. Kosovich places the blame for the unused beds on a decades-old federal rule dictating which mental health and addiction services can be covered by Medicaid, the public health insurance program for low-income people, and what treatments are out of bounds for government reimbursement.

The 1965 rule was meant to guard against the historically unethical warehousing of mentally ill people at large facilities, referred to as Institutions of Mental Disease (IMD), and to incentivize states to invest in smaller-scale community- based treatment. Kosovich’s 40-bed facility, the largest treatment center at Rimrock, is on the wrong side of the IMD rule. Because it’s licensed for more than 16 beds, it can’t accept patients insured by Medicaid.

“It infuriates me because it’s not just,” Kosovich said, calling the hurdle for publicly insured patients, as opposed to those with private insurance, “a parity issue.”

Rimrock has worked within the rule to create treatment avenues for Medicaid patients, such as serving them in smaller residential facilities licensed for fewer than 16 beds and having the facility’s detox center licensed separately as a “suite” within the larger building. But in the coming months, to Kosovich’s relief, those workarounds will be a thing of the past.

A new agreement between state and federal health officials carves out an exception to the IMD rule, allowing Kosovich’s 40-bed facility to scale up treatment for an estimated 350 additional Medicaid patients a year. But the win for Rimrock is only part of the state’s overall plan to expand inpatient treatment beds for Montanans with acute mental illnesses and substance use disorders. And that broader goal has been stalled by one prominent and beleaguered psychiatric facility with hundreds of patients: the Montana State Hospital in Warm Springs. ONE STEP FORWARD, ONE STEP BACK Montana’s health department received approval in July for part of a plan it submitted to the federal Centers for Medicaid and Medicare Services (CMS) last October. That proposal would help implement Republican Gov. Greg Gianforte’s signature HEART Initiative, a far-reaching set of reforms meant to improve mental health and substance use treatment in Montana partly funded by recreational marijuana tax revenues.

Among other requests, the state asked for Medicaid to cover short-term treatments for serious mental illness, serious emotional disturbance and addiction at facilities with more than 16 beds, an exception to the IMD rule. The proposal identified Rimrock and the state psychiatric hospital as existing institutions that...