OHA receives federal approval for Medicaid behavioral health provider rate increases

Oregon Health Authority has received federal approval to increase Medicaid behavioral health fee-for-service (FFS) provider rates by a net average of 30 percent. 

The increase will enable OHA to continue investments to improve access to care, incentivize culturally and linguistically specific services, invest in workforce diversity and support staff recruitment.

Eligible Behavioral Health providers in rural and non-rural areas that provide culturally, and linguistically specific services will receive increases of 22 percent and 27 percent respectively for several outpatient services.

The legislature allocated $42.5 million through HB 5202 in 2022 for behavioral health rate increases, which is expected to bring approximately $112 million in matching federal Medicaid funds for increases across both FFS and increases paid through Coordinated Care Organizations (CCO).

This past week, the Centers for Medicare and Medicaid Services approved the FFS portion of the increase, which amounts to $24 million, with an estimated matching federal Medicaid funds of $56 million.

The combined $154.5 million in rate increases will boost funding for treatment programs and will expand access for people seeking mental health and substance use treatment.

OHA is still awaiting approval for the CCO rate increases from CMS.

Under the proposed fee-for-service rate increases for providers:  

  • Programs providing children with intensive psychiatric treatment received rate increases of approximately 37 percent.
  • Substance use disorder residential treatment services received rate increases of approximately 32 percent.
  • Adult residential mental health treatment programs received rate increases of 30 percent.
  • Adult outpatient mental health treatment programs received rate increases of approximately 29 percent.

“This federal approval represents a win-win that provides a revenue boost to providers that can be used toward expanding the scope of services to Medicaid clients, while providing us with the revenue to continue making strategic investments to stabilize our behavioral health system,” said OHA Chief Financial Officer Dave Baden. 

The increases to the Oregon Health Plan fee-for-service fee schedule will be effective retroactively to July 1, 2022. If approved by CMS, the 2023 CCO contract will include agreements to support CCO rate increases for their behavioral health provider networks, effective January 1, 2023.