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Removes the Medicaid "IMD exclusion" so Medicaid can pay for services delivered in institutions for mental diseases (IMDs) for people under age 65, and requires states to add a plan and annual reporting showing expanded access to outpatient and community behavioral health, crisis services, care coordination, screening for co‑occurring conditions, strategies to engage youth and adults in need, utilization-review safeguards for least‑restrictive care, and detailed facility-level data on costs, use, lengths of stay, and post‑discharge outpatient treatment (including MAT). The change takes effect on enactment, with extra time allowed for states that need new state legislation to comply.
The bill expands federal Medicaid support and care coordination for behavioral health—improving access, crisis response, and continuity of care for people with serious mental illness—while increasing state costs, administrative burdens, and the risk of greater institutionalization if community services are not scaled up.
Medicaid beneficiaries under 65: Federal Medicaid will pay for care in psychiatric residential (IMD) facilities for this group, increasing access to inpatient behavioral health services.
People with mental-health crises and communities: States must expand crisis stabilization, mobile crisis teams, and community-based behavioral health services, which can reduce emergency room visits and police encounters.
Medicaid beneficiaries discharged from IMDs: The bill requires better oversight and reporting on post-discharge outpatient care (including medication-assisted treatment), improving continuity of care and follow-up treatment.
State governments and taxpayers: Expanding Medicaid payment for IMD stays for under-65 enrollees will likely increase state Medicaid spending and could require budget reallocations or higher state costs.
Medicaid beneficiaries and people with disabilities: If community-based capacity isn't expanded quickly, expanded federal coverage may lead to increased use of institutional IMD beds and longer stays instead of community-based care.
Medicaid beneficiaries and health systems: Expanded coverage could increase demand for IMD beds and longer institutional stays if community services lag, worsening capacity constraints.
Introduced June 17, 2025 by Salud Carbajal · Last progress June 17, 2025