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Mental Health, Addiction Agencies Facing Problems With New Billing Reforms

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Mental Health, Addiction Agencies Facing Problems With New Billing Reforms

Providers say the shift to fee-for-service reimbursement may hurt ability to serve the neediest patients

Medical Costs

Some New Jersey behavioral health providers fear an overhaul to the billing system designed to increase historically low Medicaid reimbursements may hurt their ability to provide treatment for those not covered by the government-subsidized plan and too poor to pay for their own treatment.

The concern comes amid wider confusion for community health providers and patient advocates about the widespread changes to the state’s Medicaid payment system that took effect a month ago. State officials have said the reform will improve efficiency and flexibility.

But the reform also has another, less-publicized goal: to shift much of the financial burden to the federal government. That means a shift to fee-for-service charging, ending the sliding scale many providers used to help patients with private insurance that does not cover behavioral health, those who can’t afford the copays required by their plans, and those not covered by Medicaid or any other insurance.

Providers have welcomed the new investment Gov. Chris Christie made to increase Medicaid rates, which have long been a source of concern. But they are concerned that, despite the higher reimbursements, they will not have enough to cover their operational costs.

“Suddenly the only thing that counts is who has Medicaid,” said Joe Masciandaro, president and CEO of CarePlus NJ, which provides behavioral care at two-dozen sites in Northern New Jersey. “The reality is, the cost of care out-of-pocket for some families is just prohibitive.”

Christie has heralded an additional $127.8 million he included in this year’s budget to help fund higher payments to a network of more than 100 community providers who treat some of the state’s most vulnerable and emotionally unstable adults. But the extra dollars – which allowed the state to more than double some rates – came with a requirement that providers start to shift their billing practices from an annual contract system to one under which they are paid for each patient service.

The state Department of Human Services, which oversees the network of private mental health and substance disorder providers, has staggered the rollout of this transition over the next 18 months and has met repeatedly with behavioral health leaders to share updates and answer questions. While most states have already undergone similar transitions, the changes are the most significant reform to New Jersey’s system in nearly 30 years.

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The Supportive Housing Association of New Jersey (SHA) is a statewide, nonprofit organization, founded in 1998, whose mission is to promote and maintain a strong supportive housing industry in New Jersey serving people with special needs.

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