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Colorado Medicaid Expands Addiction Treatment Services Starting Jan. 1

Residential treatment room.jpg
Stephanie Daniel
Colorado’s Medicaid program is expanding its substance use disorder benefit to include new services like residential treatment programs.

Colorado is increasing addiction treatment for Medicaid members.

Starting on Jan. 1, Health First Colorado will expand its substance use disorder (SUD) benefit. Residential and inpatient treatment and withdrawal management services, including detox, will be added to Medicaid’s existing list of covered services.

The new services will be an entitlement benefit, giving Medicaid members access to a full range of treatment options. This continuum of care is important, said Laurel Karabatsos, deputy Medicaid director at the Colorado Department of Health Care Policy and Finance, especially with the impacts of COVID-19 and the state’s ongoing opioid crisis.

“It is one of those illnesses that that really can bring down a whole family and is difficult to treat and then impacts children and parents and the financial stability of families,” she said. “I just think you can't really overstate how important it is to communities when we have a full continuum of services.”

Medicaid will only reimburse providers for medically necessary treatment services. While the expansion does provide a continuum of care, some things will not be covered like the cost of room and board at a residential facility and certain support and ancillary services.

“But it does mean long-term that we’re going to be able to expand our capacity in the state. We have to build that capacity first,” said Robert Werthwein, director of the Office of Behavioral Health. “At the end of the day, it means more dollars going towards substance use residential treatment in the state of Colorado.”

Currently, Colorado’s Office of Behavioral Health pays for 280 beds per day in residential treatment programs. But after Medicaid pays for the expanded SUD benefit for a year and the state increases capacity, Werthwein said, the number of beds could double.

The benefit expansion was authorized by the state legislature in 2018. To get the program up and running, the Department of Health Care Policy and Financing collaborated with the Office of Behavioral Health, Managed Service Organizations, Regional Accountability Entities and providers, and advocated on the implementation of the new SUD services.

The ongoing partnership will include activities to monitor the utilization of the benefit, troubleshoot problems, build capacity for additional services and improve care coordination for members with SUD.