The Promise of MediCal Expansion


nicholas-vrataricIn 2011, more than four out of 10 low-income Californians between the ages of 18 and 64 were without healthcare coverage. With the official implementation of the Affordable Care Act on January 1, 2014, however, these figures will change drastically and millions more low-income Americans will have access to Medicaid, our national health program for individuals with limited incomes and resources. Starting next year, almost all childless adults under 138% of the Federal Poverty Level will be eligible for Medicaid—an unprecedented service expansion that will make healthcare accessible to several million Americans.

This dramatic expansion of Medicaid, known in California as MediCal, is a central component of healthcare reform, and will provide public healthcare coverage to between 1.4 and 1.7 million Californians. In Los Angeles County alone, it is estimated that more than 600,000 individuals could become eligible for this program in the new year.

In addition to this expansion, the US Department of Health and Human Services recently issued a final rule increasing parity between substance use/mental health disorders and medical/surgical benefits in group and individual health plans. This parity ruling was stronger than anticipated, and will help guarantee that patients utilizing substance abuse and mental health services do not experience barriers to treatment or unfair financial ramifications resulting from their need for treatment. The ruling builds on the Affordable Care Act’s designation of substance use disorder as one of 10 essential benefits that must be covered by health plans.

More details are also starting to emerge about insurance coverage for the populations CLARE traditionally treats—and what substance use disorder (SUD) treatment benefits may look like for these individuals. Many of the individuals who will be seeking services in CLARE’s Pico Recovery programs will access coverage through MediCal expansions, and it is encouraging to hear that the benefits they receive will prove to be more robust than originally thought.

Although SUD services will continue to be carved out and administered by individual counties through the Drug MediCal program, healthcare reform promises to improve upon the current benefits available for SUD treatment under Drug MediCal. At the moment, Drug MediCal covers a very spare basket of benefits, including only outpatient counseling, narcotic treatment programs (such as methadone), day care rehabilitative services, residential services for perinatal patients, and Naltrexone, a prescription drug used for the management of alcohol and opioid dependence.

Proposed expansions in Drug MediCal promise to supplement this list of benefits fairly substantially. Starting in 2014, clients covered by Drug MediCal will also be covered for inpatient detoxification, intensive outpatient services, day treatment, individual and group counseling, medical treatment for withdrawal, and transitional residential services—all of which are significant additions that enhance a client’s chances of successful recovery.

One key element that remains absent from this expansion, however, is clear-cut plan for covering long-term residential recovery. Although the new Drug MediCal does make provisions for “transitional residential” services, it remains unclear what length of stay will be covered by this benefit. It seems unlikely that these transitional services will comprise more than 60 days of treatment, even though most service providers understand that, for someone who needs residential treatment, three months is generally the minimum recommended stay.

In addition, due to older laws governing Medicaid, MediCal will not provide reimbursement for treatment in a residential facility with more than 16 beds. This prohibition threatens to make residential treatment too costly a proposition for both providers and clients, even though it is an important component of the SUD care continuum and a necessary benefit for people experiencing severe substance use disorder.

Even though more work is certainly necessary on the residential treatment provisions of Drug MediCal, it has become clear that outpatient treatment will be the key modality for clients covered by these plans. Under the new Drug MediCal, outpatient treatment, counseling, and even detoxification (possibly through techniques such as medication-assisted therapy) will be the norm, and this shift is prompting CLARE and agencies like us to shift the way we think about treatment.

Under healthcare reform, behavioral health services (of which SUD is a component) will be increasingly tied in with primary healthcare, and many people accessing outpatient treatment will do so through referrals from federally qualified healthcare clinics (FQHCs). In order to prepare for this reality, CLARE is working with two of the Westide’s largest FQHCs—Venice Family Clinic and the Westside Family Health Clinic—to create partnerships that will enable clients to move efficiently from a primary healthcare setting into an SUD treatment setting.


Many details about healthcare reform remain unresolved, but we are slowly starting to gain clarity on the overall picture. CLARE has spent years proactively preparing for these changes, and we are continuing to lay the foundation for success in the new system. As millions more Californians gain access to healthcare coverage that will enable them to seek life-saving SUD services, CLARE is prepared to meet the ever-increasing demand for high-quality, cost-effective treatment and ensure that we can offer recovery to anyone in need.

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