Institutions for Mental Diseases (IMD) Exclusion and Substance Use Disorders: Lay of the Land

Executive Summary

The Medicaid Act prohibits the use of federal funding for services provided in Institutions for Mental Diseases (IMDs). In response to the overdose epidemic, two competing pathways have been implemented that allow states to circumvent the IMD exclusion: the SUPPORT Act’s state plan amendment (SPA) option and the use of section 1115 demonstrations. This issue brief summarizes research demonstrating the lack of quality of SUD care in these institutions. Given that the SUPPORT Act SPA option is set to expire in 2023, the paper also explains key differences between the options to help policymakers make informed decisions moving forward.

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