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Committee alerted to SUD voucher shortfall; IMD cap likely to be reached in April
Summary
DHHS told the HR section that the SUD voucher program is expected to reach the 45 percent cap on reimbursements to IMD residential providers in April, creating an estimated $1.8 million shortfall for inpatient services through the end of the biennium.
Chairman Nelson said the committee was "going to run out of money in the inpatient side" of the SUD voucher and asked Pam Segnus, executive director of behavioral health at DHHS, to describe options.
Pam explained the SUD voucher's rules: the program limits IMD (residential/inpatient) reimbursements to 45 percent of total voucher funding to preserve funds for non-IMD outpatient providers. "So that 45% cap is predicted to, we're expecting to hit that cap in April," Pam said. She told members DHHS estimates a roughly $1,800,000 shortfall from April through the end of the biennium if the cap and current run rate hold.
Pam described two near-term options: 1) use departmental roll-up dollars to cover the shortfall this biennium, which would require either internal reallocation authority or legislative action; or 2) request emergency commission approval to move funds, a route the chair said he was reluctant to rely on and wished to avoid.
Committee members asked about program integrity and payer-of-last-resort rules. Pam said DHHS now has procedures and staff to ensure SUD voucher use remains payer of last resort and that providers who later receive Medicaid or commercial reimbursement return voucher payments when applicable.
Members discussed longer-term fixes: raising or recalibrating the IMD cap (for example to 50/50), creating an emergency-trigger mechanism for the voucher fund, or pursuing federal options such as IMD-waiver approaches. Pam warned that changing the cap affects stability and predictability for providers: removing controls can front-load spending and leave providers exposed later in the biennium.
Prairie Recovery Center's David Marion described the operational impacts for residential providers, saying facilities sometimes absorb medical costs or rely on local hospitals and that admissions can be affected by the possibility of losing Medicaid coverage while a person is in an IMD.
The committee asked DHHS to refine options, gather statutory/administrative vehicles for short-term funding, and return with proposed amendment language and financial pathways to prevent treatment interruptions.
