Senate approves expansion of Medicaid coverage for long-term residential treatment for co-occurring substance use and mental health conditions

The Senate on voice vote approved S.36, an act to expand Medicaid coverage for long-term residential treatment for people with co-occurring substance use disorder and mental health conditions, after adopting a committee amendment that inserts a "medically necessary" standard for both high-intensity and low-intensity residential care.

The amendment, offered by Senator Lyons on behalf of the Committee on Health and Welfare, adds language requiring that care in high-intensity settings and in lower-intensity recovery residences be prescribed as "medically necessary," as determined by a psychiatrist or appropriate clinical authority. "The language that's added here is medically necessary and that would be something prescribed by a psychiatrist to ensure that medically necessary treatment is available," Lyons said while explaining the committee amendment.

Supporters said the change clarifies coverage for people who need acute withdrawal management and for those who would benefit from longer-term residential support after withdrawal. A senator identified as the senator from Windsor said legislative counsel had clarified inpatient versus outpatient treatment and that outpatient care would remain eligible under the bill; that senator said they would "happily support" the bill as expanded coverage for low-income Vermonters on Medicaid seeking substance misuse treatment.

Committee counsel and the amendment sponsor also noted there are currently no Medicaid providers that treat Vermonters out of state and that in-state capacity is sufficient at present. Lyons told the Senate the amendment responds to questions raised on second reading and that it covers both short-term acute withdrawal care and longer-term recovery residences such as Jenna's Promise, which the committee described as providing nonmedical supports with clinics available on call.

The Senate first adopted the committee amendment on a voice vote and then passed the bill on third reading by voice vote.

Discussion vs. decision: the committee amendment was described as clarifying that covered services must be medically necessary; the Senate formally adopted that amendment and then approved the bill. No roll-call vote or numerical tally was recorded in the transcript; both actions were decided by voice vote.

The bill's supporters and the committee framed the change as making explicit the level of clinical necessity for coverage in both high- and low-intensity residential settings for Medicaid beneficiaries. The Senate record does not show further technical changes or an amendment that altered funding levels in session.

What happens next: with Senate passage recorded on third reading, the bill moves on to the next step in the legislative process (not shown in this transcript).