Health Blog

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Medicaid and Mental Health

May 2, 2016

17461045-mmmainCurrently, the majority of dollars spent on mental health come from Medicaid, which coupled with Medicare equate to $88 billion in 2009, according to the Substance Abuse and Mental Health Services Administration.  The need for behavioral healthcare is a well-documented and growing problem within America’s Medicaid population.

Spending for behavioral health in the Medicaid population has soared from $6.6 billion in 1986 to $35.7 billion in 2005. The Medicaid population spends 10.4 percent on mental health whereas private insurers spend less than half this amount. While at the same time, many states are lacking the resources and funding to provide the benefits for Medicaid, including Illinois where some providers are still awaiting millions in funding. Medicaid spending for mental health is rising at an average rate of 6.4 percent a year. The share that states and local agencies are taking on for mental health is decreasing while Medicaid is having to brunt an increasing portion of the responsibility and costs.

This is a look at the spending and utilization rates of the Medicaid population in 2011 according to a Modern Healthcare report:


  • $131.18 billion: total Medicaid spend for enrollees with a behavioral health diagnosis
  • Over 20%: amount of Medicaid spend on enrollees with a behavioral health condition
  • $13,303: average spending for enrollees with a behavioral health diagnosis


There are also many administrative roadblocks when it comes to providing the needed care to the Medicaid population. The reimbursement rates for mental health are a function of what each individual state budgets for Medicaid. These figures are not being adequately funded with the increasing demand.  Approximately 32 million individuals will gain access to behavioral health coverage for the first time by 2020 from the Affordable Care Act.

Clearly there is a desperate need for an affordable, accessible, and scalable behavioral health treatment option. Prevail is an ideal solution for a socially as well as demographically diverse population that lacks behavioral health clinicians, while having an enormous need for behavioral health treatment. Over the last six years Prevail has built and developed truly novel, clinically proven behavioral health treatment.

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