Medicaid Financing of State and County Psychiatric Hospitals
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Acknowledgments
The authors of this report are Debra Draper, Megan McHugh, Lori Achman, and Sylvia Kuo of Mathematica Policy Research, Inc. Judith Teich, of the Center for Mental Health Services (CMHS), Substance Abuse and Mental Health Services Administration (SAMHSA) was the Government Project Officer, and Jeffrey A. Buck, Associate Director for Organization and Financing, CMHS/SAMHSA, served as advisor.
Disclaimer
Material for this report was prepared by Mathematica Policy Research, Inc., for the Substance Abuse and Mental Health Services (SAMHSA), U.S. Department of Health and Human Services (DHHS), under Contract Number 282-98-0021, Task Order No. 29. The content of this publication does not necessarily reflect the views or policies of CMHS, SAMHSA, or DHHS.
Public Domain Notice
All material appearing in this report is in the public domain and may be reproduced or copied without permission from SAMHSA or CMHS. Citation of the source is appreciated. However, this publication may not be reproduced or distributed for a fee without the specific, written authorization of the Office of Communications, SAMHSA, DHHS.
Electronic Access and Copies of Publication
This publication can be accessed electronically at www.samhsa.gov. For additional free copies of this document, please call SAMHSA's Mental Health Information Clearinghouse at 1-800-789-2647.
Recommended Citation
Draper DA, McHugh MC, Achman L, Kuo S. Medicaid Financing of State and County Psychiatric Hospitals. DHHS Pub. No. (SMA) 03-3830 Rockville, MD: Center for Mental Health Services, Substance Abuse and Mental Health Services Administration, 2003.
Originating Office
Center for Mental Health Services
Office of the Associate Director for
Organization and Financing
Substance Abuse and Mental Health Serices Administration
1 Choke Cherry Road Room 6-1057 Rockville MD 20850
tel. 240-276-1959
fax. 240-276-1395
www.mentalhealth.samhsa.gov
DHHS Publication No. (SMA) 03-3830
Printed 2003
Table of Contents
Executive Summary
I. Introduction
A. Historical Context of Public Psychiatric Hospitals
B. Focus of This Report
C. Study Methods
D. Organization of the Report
II. Sources of Medicaid Funds for State and County Psychiatric Hospitals
A. IMD Optional Services
B. Medicaid Managed Care
C. Disproportionate Share Hospital Payments
D. Administrative Payments
E. Conclusion
III. Medicaid Funding of State and County Psychiatric Hospitals in Five States
A. The Role of Public Psychiatric Hospitals in States’ Public Mental Health Systems
B. States as Primary Funders of State and County Psychiatric Hospitals
C. Sources of Medicaid Funds
D. Conclusion
IV. National Estimate of Medicaid Funding
A. Previous Estimates of Medicaid Fundings
B. National Estimate of Medicaid Funding of Public Psychiatric Hospitals
C. Assumptions and Limitations of the National Estimate
D. Conclusion
V. Conclusions
A. Medicaid Funding and Public Psychiatric Hospitals
B. Pressures Affecting Future Medicaid Funding
References
Endnotes
Figures
Figure I.1 Number of Psychiatric Hospitals by Ownership Type, 1970 – 1998
Figure I.2 Number of Psychiatric Hospital Beds by Ownership Type, 1970 – 1998
Figure II.1 Total IMD DSH (including public and private IMD payments), 1991 – 2000
Figure B.1 Hypothetical Example of a State Medicaid Financing Strategy
Figure C.1 State Psychiatric Hospitals in Arkansas
Figure C.2 State and County Psychiatric Hospitals in California
Figure C.3 State and County Psychiatric Hospitals in Iowa
Figure C.4 State and County Psychiatric Hospitals in Maryland
Figure C.5 State and County Psychiatric Hospitals in New Jersey
Tables
Table II.1 IMD Optional Services by State
Table II.2 1915(b) and 1115 Waiver Provisions Affecting IMDs
Table II.3 State DSH Allocations by Psychiatric Hospital Ownership, FY 1998
Table II.4 IMD DSH Payments by State (including public and private IMD payments), 2001
Table III.1 Revenues of State-Owned Psychiatric Hospitals by Source and Percentage of Total (in millions of dollars)
Table III.2 Number and Percentage of Children/Adolescent and Geriatric Beds in the State Psychiatric Hospital Systems
Table IV.1 Conversion of Federal Medical Assistance Percentage (FMAP) to Available State Financial Information
Table IV.2 Total Medicaid Funding of State Psychiatric Hospitals in Five Case Study States (in millions of dollars)
Table IV.3 Total Estimate of Medicaid Funding of State and County Psychiatric Hospitals: 2001 (in billions of dollars)
Table D.1 Descriptions and Limitations of Currently Available Data on Medicaid Financing of Public Psychiatric Hospitals
Appendixes
Appendix A. Expert Advisory Panel Members
Appendix B. The Use of Intergovernmental Transfers in the Disproportionate Share Hospital Payment Program
Appendix C. Profiles of Public Psychiatric Hospitals in the Five Case Study States
Profile of Public Psychiatric Hospitals in Arkansas
Profile of Public Psychiatric Hospitals in California
Profile of Public Psychiatric Hospitals in Iowa
Profile of Public Psychiatric Hospitals in Maryland
Profile of Public Psychiatric Hospitals in New Jersey
Appendix D. Data Limitations
SMA03-3830
08/2003
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