What CMS’ New Marketplace Proposal Means for Behavioral Health Providers, Payers

The U.S. Centers for Medicare & Medicaid Services (CMS) is looking to expand access to behavioral health services by making mental health facilities and substance use disorder treatment centers into essential community providers (ECP).

The changes, which are part of the Notice of Benefit and Payment Parameters for 2024 proposal, would mean that health plans offered through federal and state-based marketplaces are required to cover these behavioral health providers.

If passed, the changes could make it easier for patients to get behavioral health services. It could also put the pressure on payers to contract with behavioral health providers.


“Adding mental health and substance use disorder facilities to the list of Essential Community Providers would be meaningful in a couple of ways,” Michelle Guerra, a senior consultant in population health and health equity at RTI Health Advance, told Behavioral Health Business. “First, it would expand access to behavioral health care for members on marketplace plans. And second, it sends a clear message that behavioral health is an essential type of health care, reducing stigma around behavioral health.”

The proposal would impact the roughly 14.5 million people enrolled in health plans through the marketplace, the bulk of whom are individuals who do not qualify for Medicare, Medicaid or Children’s Health Insurance Program (CHIP) coverage. That number could grow as the public health emergency (PHE) comes to an end and states begin eligibility redeterminations for Medicaid.

The proposal may reduce the number of out-of-network behavioral health facilities, potentially driving down costs for patients, according to Guerra. In fact, she noted that behavioral health facilities are five times more likely to be out of network than medical surgical inpatient facilities, according to research from risk-management, benefits and technology firm Milliman.


It’s not just patients that would be impacted by the proposal. In response, payers may need to amp up their contracts with mental health and substance use disorder providers in their service area.

“That could mean reaching out to some mental health and substance use disorder facilities [that] were unable or unwilling to contract in the past – maybe due to unattractive reimbursement or difficult prior authorization requirements,” Guerra said. “It is a chance for payers and non-network facilities to come back to the table and work out a contract that can meet both parties’ needs. Payers likely will need to be more flexible in their contracting efforts to bring more of these facilities on board such as considering higher reimbursements or other incentives.”

The new proposal also seeks to expand the current overall 35% provider participation threshold to federally qualified health centers (FQHCs) and family planning providers (FPPs). FQHCs and FPPs are two of six types of care providers designated as ECPs.

“FQHCs and FFPs may already include integrated behavioral health services or partnerships with other community-based behavioral health providers,” Guerra said. “Requiring payers to up their contracting efforts with FQHCs and FFPs could increase access to behavioral health services for members, closing the wide gap between the demand for behavioral health services and short supply of providers.”

In addition to the changes to behavioral health providers, the proposal also includes provisions aimed at streamlining the process of choosing a health plan on the marketplace and making it easier for individuals losing their Medicaid or CHIP coverage to enroll. Specifically, the rule would allow people losing their coverage to enroll in a marketplace health plan 60 days before or 90 days after the loss of coverage.

Up to 18 million people are at-risk of losing their Medicaid coverage when the PHE ends, according to research from the Urban Institute. Roughly 4 million people currently enrolled in Medicaid will be left without insurance, the research predicts. Additionally, about 3.2 million children will transfer from CHIP to another health plan.

The federal government has rolled out a number of initiatives focused on expanding access to behavioral health services for Medicare and Medicaid beneficiaries.

For example, earlier this month, CMS announced a new proposal for Medicare Advantage (MA), which would add psychologists, licensed clinical social workers and prescribers of medication for opioid use disorder (OUD) to the list of evaluated specialties under MA. The proposal also included new behavioral health wait time standards.

Additionally, CMS finalized new rules that allows behavioral health providers to bill for licensed professional counselors (LPCs) and licensed marriage and family therapists (LMFTs) visits. The rules also allow hospital outpatient departments to bill for in-home telebehavioral health services.

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