Most States Allow Medicaid Managed Care Plans Discretion To Restrict Substance Use Disorder Treatment Benefits: Study examines Medicaid managed care plans’ restrictions on substance use disorder treatment
Abstract
Managed care plans, which contract with states to cover three-quarters of Medicaid enrollees, play a crucial role in addressing the drug epidemic in the United States. However, substance use disorder benefits vary across Medicaid managed care plans, and it is unclear what role states play in regulating their activities. To address this question, we surveyed thirty-three states and Washington, D.C., regarding their substance use disorder treatment coverage and utilization management requirements for Medicaid managed care plans in 2021. Most states mandated coverage of common forms of substance use disorder treatment and prohibited annual maximums and enrollee cost sharing in managed care. Fewer than one-third of states forbade managed care plans from imposing prior authorization for each treatment service. For most treatment medications, fewer than two-thirds of states prohibited prior authorization, drug testing, "fail first," or psychosocial therapy requirements in managed care. Our findings suggest that many states give managed care plans broad discretion to impose requirements on covered substance use disorder treatments, which may affect access to lifesaving care.
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The finding that 43.0% of SUD service utilizations were self-pay is consistent with documented barriers to SUD treatment, including lack of insurance, inadequate coverage benefits, cash-only payment acceptance, and patients' self-pay preference due to stigma-related privacy concerns.
“our finding that 43.0% of SUD service utilizations were self-pay is consistent with documented barriers to SUD treatment, including lack of insurance,24 inadequate coverage benefits across various insurance types,24, 31-36 cash-only payment acceptance (i.e., non-acceptance of any insurance) by SUD treatment providers,36 and patients’ self-pay preference due to stigma-related privacy concerns.24”
From County-Level Variation in Substance Use Disorder Service Utilization by Insurance Payers and Self-Pay in the United States (2026) · cites this paper as [34]
Utilization management strategies are commonly used in Medicaid and private insurance plans to regulate SUD treatment benefits through mechanisms such as prior authorization, drug testing, annual maximums, duration restrictions, high deductibles, and monthly caps on total prescriptions.
“Moreover, utilization management strategies are commonly used in Medicaid and private insurance plans to regulate SUD treatment benefits through mechanisms such as prior authorization, drug testing, annual maximums, duration restrictions, high deductibles, and monthly caps on total prescriptions,24, 26, 34-35”
From County-Level Variation in Substance Use Disorder Service Utilization by Insurance Payers and Self-Pay in the United States (2026) · cites this paper as [34]
Cites
Comparative effectiveness of different treatment pathways for opioid use disorder.
Wakeman, S. E., Larochelle, M. R., Ameli, O., Chaisson, C. E., McPheeters, J. T., Crown, W. H., Azocar, F., & Sanghavi, D. M. (2020) · JAMA Network Open · doi:10.1001/jamanetworkopen.2019.20622 · Cited by 995 · see citing works
Medicaid benefits for addiction treatment expanded after implementation of the Affordable Care Act
Andrews, C. M., Grogan, C. M., Smith, B. T., Abraham, A. J., Pollack, H. A., Humphreys, K., Westlake, M. A., & Friedmann, P. D. (2018) · Health Affairs · doi:10.1377/hlthaff.2018.0272 · Cited by 54 · see citing works
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Han, B., Compton, W. M., Jones, C. M., Stimson, D. T., Barfield, E. T., Bellgowan, J. F., Hobin, J. A., & Volkow, N. D. (2026) · The Journal of Clinical Psychiatry · doi:10.4088/jcp.26m16340
- Authors
- Peterson, L. A., Andrews, C. M., Abraham, A. J., Westlake, M. A., & Grogan, C. M.
- Affiliations
- University of Chicago (US)
- University of South Carolina (US)
- University of Georgia (US)
- Venue
- Health Affairs
- Publisher
- Health Affairs Publishing, LLC
- Published
- 2024-07-01
- Volume
- 43
- Issue
- 7
- Pages
- 1038-1046
- ISSN
- 0278-2715 (ISSN-L)
- 1544-5208
- OpenAlex
- W4400183362
- Cited by
- 12
- References
- 2
- Citations by year
- 2026: 4 · 2025: 8
- FWCI
- 4.25
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- Health Affairs (publishedVersion)
- PubMed (publishedVersion)
- Funders
- Agency for Healthcare Research and Quality (T32HS000084)
- National Institute on Alcohol Abuse and Alcoholism (R01AA029097)
- National Institute on Drug Abuse (R01DA052425)
- Topics
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Healthcare Policy and Management
- Health Sciences › Medicine › Epidemiology › Substance Abuse Treatment and Outcomes
- Health Sciences › Medicine › Public Health, Environmental and Occupational Health › Opioid Use Disorder Treatment
- Keywords
- Medicaid managed care, addiction treatment, government regulation, prior authorization, drug testing, psychosocial interventions, access to addiction treatment, state health policy
- MeSH terms
- Prior Authorization, Humans, Managed Care Programs, Medicaid, United States, Cost Sharing, Insurance Coverage, Substance-Related Disorders
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