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Senate orders third reading of bill to expand Medicaid coverage for medically necessary residential SUD and co‑occurring mental‑health treatment
Summary
S.36 would require Medicaid to cover medically necessary high- and low-intensity residential treatment episodes for Vermonters with substance‑use disorders and co‑occurring mental‑health conditions, plus a review of Medicaid payment models for residential treatment; the Senate amended and ordered the bill for third reading.
The Vermont Senate on March 20 ordered third reading of S.36, a bill to expand Medicaid coverage for medically necessary residential treatment for people with substance-use disorder (SUD) and co-occurring mental-health conditions, and to require a policy review of Medicaid payment models for residential SUD services.
Major provisions
- Requires the Agency of Human Services to provide coverage for medically necessary high‑intensity, medically monitored residential treatment episodes for Medicaid beneficiaries with SUD and co‑occurring mental‑health conditions, when prescribed by an appropriate licensed health-care professional employed by a participating residential treatment program. - Requires coverage for medically necessary low‑intensity clinical‑managed residential treatment episodes under the same prescription and program‑participation conditions. - Coverage is required for the full length of stay prescribed by the treating health-care professional; providers must consider clinical best practices across the continuum of care. - Directs the Agency of Human Services to review Medicaid payment models for residential SUD treatment services including cost, co‑occurring needs, and post-residential supports, and to submit recommendations and proposed legislation by December 1, 2025. - Repeals certain provisions that had not taken effect related to incarceration in DOC facilities; effective date set to July 1, 2025 for statute sections as indicated.
Committee testimony and amendments
Health and Welfare reported amendments to clarify that coverage is limited to medically necessary residential treatment (Senator Hart noted insertion of “medically necessary” before intensity level language). Multiple providers and agency witnesses testified, including the deputy commissioner for the Vermont Department of Health, the state opioid treatment authority, Department of Vermont Health Access staff, Medicaid director Monica Overby, providers from Spectrum Youth and Family Services, and recovery‑sector leaders.
Appropriations review
The Appropriations Committee reported the bill as budget‑neutral in its current form, noting limited or no cost as written; Appropriations indicated the Health and Welfare amendment would be better offered before third reading and supported the bill as written pending that amendment.
Outcome
The Senate adopted the Health and Welfare committee amendment on the floor and ordered third reading by voice vote. Senators asked clarifying questions about whether out‑of‑state residential providers participate in Vermont Medicaid and whether the bill expands outpatient coverage (the chair said Medicaid arrangements and out‑of‑state agreements would be clarified before third reading and that the bill focuses on residential, medically necessary services).
