Brief State Legislatures Address Medicaid Coverage and Payments in the 2024 Legislative Session

In 2024, states enacted more than 250 bills related to the Medicaid program. NCSL tracks state legislation affecting state Medicaid programs in the Health Costs, Coverage and Delivery Database.

Trending topics include eligibility and benefits, provider taxes and payments, behavioral health, individuals with disabilities, and maternal health with emerging state focus on reentry and social drivers of health.

Eligibility and Benefits

The bulk of Medicaid legislation enacted in 2024-133 bills-addressed Medicaid eligibility and benefits. The majority of these increase eligibility or access to specific benefits, consistent with trends in recent years. Some states are examining additional eligibility requirements for future years.

Some states will now connect individuals to services while their eligibility application is processed. For example, Mississippi lawmakers approved presumptive eligibility for pregnant women and Colorado authorized a presumptive eligibility program for long-term services and supports.

Some states changed post-enrollment eligibility requirements. New Mexico created an exemption from Medicaid estate recovery for certain types of accounts. Estate recovery permits the state to recover certain assets from a deceased beneficiary after their death.

Some states are examining additional eligibility requirements. Idaho and South Dakota passed resolutions related to work requirements for the expansion population. Following the resolution from the legislature, South Dakota voters approved Constitutional Amendment F, a ballot measure authorizing the state to impose a work requirement on individuals eligible under Medicaid expansion.

Lawmakers continued to cover a wide range of new services and benefits, also consistent with trends in recent years. Colorado, Connecticut, Florida, Indiana and New York enacted legislation providing Medicaid coverage for biomarker testing. Illinois and Louisiana covered services to treat menopausal symptoms. More states addressed eligibility and benefits related to maternal and behavioral health, detailed below.

Lawmakers also passed legislation requiring benefits feasibility studies. Connecticut directed the state Medicaid agency to study the feasibility of pursuing family caregiver support benefits, including respite services, through a Section 1115 demonstration waiver. Louisiana created a task force to study expanding the pool of behavioral health care providers eligible for enhanced Medicaid reimbursement.

Provider Taxes and Payments

Provider taxes and payments were top of mind for legislators during the 2024 legislative session.

At least 15 bills addressed provider taxes, a mechanism states use to finance the state share of Medicaid program funds and to finance supplemental payments for providers. California reconfigured the state's Medicaid managed care tax and South Carolina created a provider tax for private ambulance services. Kansas and Louisiana amended their respective hospital tax programs to support rural hospitals.

Twenty-one bills addressed provider payment rate studies and increases, primarily for behavioral health services, dental services and home- and community-based services. Maryland directed the state department of health to study the feasibility of covering certain dental services and setting reimbursement rates for dental providers. Idaho appropriated funds for home- and community-based services provider rate increases. Illinois increased reimbursement rates for a wide range of physical and behavioral health, substance use disorder, emergency, and home- and community-based services. Hawaii enacted legislation requesting the Department of Human Services to establish a working group to address issues related to reimbursement and payments for home- and community-based services providers.

Several bills also address changes in payment methodology. Illinois and Vermont enacted legislation instructing state Medicaid agencies to develop an alternative payment methodology for Medicaid payments to federally qualified health centers. New Hampshire directed its Medicaid agency to reimburse ambulance services for treatment provided on location, such as at a person's home, without transportation to another site.

Behavioral Health

According to the Substance Abuse and Mental Health Services Administration, 19% of people aged 12 or older in 2023 (54.2 million people) needed substance use treatment in the past year. Medicaid funds one quarter of all mental health and substance use treatment nationwide. At least 34 bills addressed some aspect of behavioral health.

States enacted legislation addressing Medicaid benefits, payment and quality for mental health and substance use disorder services. Utah passed legislation permitting reimbursement for nonemergency secured behavioral health transport providers. West Virginia instructed their Medicaid agency to develop performance outcome measures for substance use disorder in-patient providers. Louisiana asked their Department of Health to develop a plan for increased reimbursement rates for substance use disorder services. Oregon established a certified community behavioral health clinic program, created a joint task force on regional behavioral health accountability, and established a Medicaid payment program for behavioral health workforce. Delaware authorized reimbursement for all school-based medically necessary behavioral health services.

Other state legislatures focused on mental health parity and compliance with federal requirements in the Mental Health Parity and Addiction Equity Act. The act requires Medicaid managed care and children's health insurance plans to provide coverage for mental health and substance use disorder services on par with medical and surgical benefits. Alaska and Maryland enacted legislation to ensure compliance with the law for their Medicaid programs. Relatedly, Tennessee required the state's Medicaid managed care plans to provide coverage and reimbursement for mental health services and treatment to the same extent that the plan provides coverage and reimbursement for the treatment of alcoholism and drug dependence.

Individuals with Disabilities

Almost a third of total Medicaid spending provides services for individuals with disabilities, and Medicaid is the largest payer of long-term services and supports for individuals with intellectual and developmental disabilities. Individuals with disabilities often receive Medicaid care through home and community-based services, programs and waivers.

In 2024 legislative sessions, around 25 bills concentrated on Medicaid-eligible individuals with disabilities, with a particular focus on individuals with intellectual and developmental disabilities.

A few states established or modified their Medicaid buy-in programs, an optional Medicaid eligibility group that allows workers with disabilities to earn income above traditional eligibility limits and maintain Medicaid coverage. Tennessee created a Medicaid buy-in program and Maryland and Louisiana increased income limits for their Medicaid buy-in program. Indiana established an intellectual/developmental disability task force to provide recommendations on modifying the Medicaid buy-in program to eliminate barriers for individuals with intellectual and developmental disabilities.

States also examined payments, eligibility, and state home- and community-based services waiver programs for individuals with intellectual and developmental disabilities.

Oklahoma appropriated funds to increase payment for certain long-term care and intermediate care facilities for individuals with intellectual and developmental disabilities. Virginia requires its Medicaid department to disregard Social Security Disability Insurance income when determining waiver eligibility for individuals with developmental disabilities.

Connecticut required the appointment of a working group to study the elimination or reduction of wait lists for the state's waiver program for children and young adults with disabilities. Florida requires its agency to develop a plan for the administration, finance and delivery of a new home- and community-based services waiver program for individuals transitioning into adulthood. The stated aim of this legislation was to prevent crisis enrollment in the state's existing waiver for people with developmental disabilities.

Maternal Health

Medicaid finances 41% of all births in the United States. At least 18 bills focused on maternal health through postpartum coverage extensions, coverage of doula services and maternal behavioral health.

Iowa and Idaho joined 47 states and the District of Columbia in extending Medicaid eligibility for postpartum individuals through 12 months postpartum. Arkansas requires the state Medicaid program to redetermine eligibility for postpartum mothers within eight weeks of giving birth to ensure enrollment and transition of the mother into other available Medicaid coverage.

Doulas are non-clinical professional labor assistants who provide physical, emotional and informational support before, during and after childbirth. Research by eClinicalMedicine, which is part of The Lancet Discovery Science, indicates that women who receive doula care have approximately 52% lower odds of cesarean delivery and 57% lower odds of postpartum depression/postpartum anxiety. Delaware lawmakers added coverage of additional postpartum doula visits to the state's existing doula benefit. For the purposes of Medicaid reimbursement, New Hampshire established a voluntary certification process for doula and lactation service providers.

Maternal behavioral health is the leading underlying cause of pregnancy-related deaths in the United States and maternal substance use during pregnancy is associated with increased risk of adverse health outcomes for both the mother and baby. Nebraska created the Prenatal Plus Program to address maternal behavioral health, which covers services for mothers at risk of having negative maternal or infant health outcomes. Washington created a postdelivery and transitional care program that allows for extended postdelivery hospital care for people with a substance use disorder at the time of delivery.

Emerging Trends: Reentry and Social Drivers of Health

Medicaid coverage for justice-involved individuals pre- and post-release was an emerging topic for state legislatures and Medicaid agencies in 2024. Incarcerated individuals are more likely than the general population to have chronic and infectious diseases including HIV, face challenges receiving medical care and are more than three times more likely to die of any cause following release from incarceration.

In response to new federal flexibilities, including Section 1115 waivers, which allow for states to provide Medicaid covered services prerelease, some states are connecting incarcerated or recently released individuals to health care through the Medicaid program. As of November 2024, 11 states have received CMS approval for Section 1115 waivers that support reentry initiatives.

Minnesota convened a reentry services working group and required the Medicaid agency to submit a Section 1115 reentry waiver. The legislation specified eligible individuals, correctional facilities, services and duration, provider requirements and payment rates. Utah lawmakers required their Medicaid agency to apply for or amend its application for a Section 1115 reentry waiver and expand the state's Medicaid Housing Related Services and Supports Program to include eligible individuals that were released within the previous 12 months. Tennessee required the state Medicaid program to continue to cover expenses for HIV medication for newly incarcerated inmates and allows the usage of federal funds.

States are also exploring Medicaid flexibilities to address social drivers of health. Unmet, adverse social conditions, such as lack of housing or nutrition, may account for up to 40% to 50% of health outcomes. Section 1115 waivers and new federal guidance provide states with the opportunity to address social drivers through the state Medicaid program.

Colorado directed its state Medicaid department to explore the feasibility of seeking federal authorization to provide nutrition and housing services. Louisiana requested the creation of a subcommittee to study ways for Medicaid to invest in community-based social services organizations that address health-related social needs.

States focused primarily on using Medicaid flexibilities to address housing in 2024. Poor housing conditions or instability can impact health outcomes, including for low-income families. Some states sought to leverage Medicaid to remove barriers contributing to housing insecurity. Medical respite facilities can offer relief for at-risk populations by providing temporary shelter in addition to medical care. Nebraska directed the Medicaid agency to seek a waiver to use Medicaid dollars to support two medical respite facilities within the state. Illinois expanded eligibility for its rental assistance program to include certain Medicaid recipients.

If there's one thing to take away from the 2024 legislative sessions it is that Medicaid continues to be a perennially important topic of interest to state legislatures.