Medicaid Bump Act
The Medicaid Bump Act would add a new federal funding mechanism to support increases in Medicaid spending on behavioral health services (including mental health and substance use services). Specifically, it would create a 90 percent federal match for the amount by which a state’s quarterly spending on behavioral health services under Title XIX exceeds the state’s baseline level from a 2019 benchmark. This increased matching would apply to expenditures over that baseline, subject to accountability requirements designed to ensure funds are used to expand and improve behavioral health services rather than replace existing state spending. The bill also directs HHS to issue guidance within 180 days to define which services count as behavioral health services, and to begin applying these changes to eligible quarters after a one-year wait period from enactment. In addition, the Act requires annual reports from HHS to Congress detailing state-by-state behavioral health payments, rates, and utilization.
Key Points
- 1Establishes a new 90% federal matching rate for increases in Medicaid behavioral health spending, measured as the amount by which quarterly expenditures exceed the 2019 baseline for those services (with baseline defined using a 4-quarter period ending March 31, 2019), subject to a maintenance-of-effort provision.
- 2Adds an accountability and maintenance-of-effort requirement: states must use the additional funds to supplement (not supplant) existing state funding for behavioral health services and to improve delivery, including higher provider payments and measures to reduce staff turnover and increase capacity, efficiency, and quality.
- 3Requires the U.S. Department of Health and Human Services to issue sub-regulatory guidance within 180 days to define which services count as behavioral health services for purposes of the increased-match provision.
- 4Effective date: the amendments apply to calendar quarters beginning on or after January 1 of the year that starts one year after enactment (i.e., roughly the first quarter after the first anniversary of enactment; for example, if enacted in 2025, applicable starting January 1, 2026).
- 5Adds a reporting requirement: within one year of enactment and annually thereafter, HHS must report to Congress on behavioral health services under Title XIX, including payment rates, the rationale for rates, and utilization by state.