Cross-State Analysis of Section 1115 Serious Mental Illness and Serious Emotional Disturbance Demonstration Monitoring Data

On November 13, 2018, the Centers for Medicare & Medicaid Services (CMS) published a State Medicaid Director Letter (SMDL #18-011) announcing opportunities for Medicaid section 1115 demonstrations to improve the quality of care for adult beneficiaries with serious mental illness (SMI) or children beneficiaries with serious emotional disturbance (SED). This demonstration opportunity allows states to develop service delivery systems that address specific concerns about the SMI/SED care continuum and to phase in a range of strategies to address those concerns. Under the SMI/SED demonstration authority, states can receive federal financial participation (FFP) for services provided to Medicaid beneficiaries during short-term stays for acute care services in psychiatric hospitals or residential mental health treatment facilities that qualify as institutions for mental diseases (IMDs). States’ receipt of FFP for such services depends on the states taking actions to ensure that IMDs provide high-quality care and that beneficiaries have access to community-based services. States must demonstrate these actions by achieving four milestones described in the SMDL, which reflect the five goals of the demonstration (also stated in the letter).

The purpose of this cross-state analysis (CSA) is to support CMS in monitoring the progress of Medicaid section 1115 SMI/SED demonstrations. CSA reports present analyses of state-submitted monitoring data that describe the availability of mental health services at the beginning of the demonstrations and annually thereafter, implementation plans pertaining to demonstration milestones, and progress toward demonstration milestones. This report focuses on data from the 12 states that submitted implementation plans by February 1, 2024.

Findings suggest that states with SMI/SED demonstrations are making progress toward expanding the availability of crisis stabilization services and community-based mental health services.