While the nearly $2 trillion American Rescue Plan (ARP) touches almost every facet of the US economy impacted by COVID-19, behavioral health is a central feature of the legislation.
The Biden administration and Congress have targeted nearly $5 billion in supplemental funding for existing behavioral health programs and services, as well as new value-based initiatives. Although this is one-time funding, it will be allocated over a period of years and affords states and providers a financial bridge to build their capacity for services into the future.
ARP funding for behavioral health is targeted in several key areas: block grant funding, workforce, and local community provider services, as well as new value-based models to promote expansion of community crisis services.
States and providers should use the funds to address immediate needs exacerbated by the COVID-19 pandemic, but also build a roadmap for the future.
Some state officials, provider leadership, and stakeholders alike are concerned about the one-time injection of ARP funds and the sustainability of the service expansion into the future. However, with the right strategy, ARP funding can be used to build internal capacity for providing services and as a bridge to sustainable funding options.
Five ways to capitalize on this one-time funding opportunity
Assessment of service gaps: ARP mental health and substance abuse block grant funding gives states an opportunity to update their gap assessments for the continuum of care of behavioral health services. Targeted investments in lagging service areas are critical to address behavioral health needs.
Long-term planning: The ARP can provide states and providers resources to examine their 5-year or 10-year behavioral health plans. Beyond immediate gaps and needs, understanding future enrollment and margin impacts, and examining longer-term delivery and funding needs is critical. The continued transition away from commercial insurance to Medicare and Medicaid has significant implications for both states and providers.
Workforce investments: ARP behavioral health funding creates the potential for states to ensure that providers enhance their workforce and address workforce needs to improve access to care. Education and awareness for existing workforce behavioral health needs will encourage retention. Partnerships with local community colleges and other educational institutions will be important to the availability of the future workforce.
Value-based payment initiatives: Value-based payment models are proliferating and they will occupy a central place in the new administration’s health policy initiatives, as witnessed in part by the inclusion in the ARP of a new Medicaid bundled payment for behavioral health crisis services. Through available ARP funding, states now have the opportunity to design and test new payment models to achieve the long-term goals of improving quality and generating program savings. Advancing health equity and reducing disparities should be central features of these new value-based models.
Prevention services: Questions about the sustainability of services expanded under the ARP are legitimate, especially in public programs like Medicaid that have seen significant enrollment growth with widespread job losses due to COVID. State healthcare leaders should be focused on maximizing the use of ARP behavioral health funding for allowable prevention services as a key component of their long-term plan for sustainability.
Obtaining maximum benefits from ARP behavioral health funding will ultimately be tied to careful planning and close coordination with other ARP funds, such as its state and local recovery funding stream.
Guidehouse is helping states and community providers obtain and leverage ARP funds to develop strategic behavioral health plans. Learn how.
Summary of ARP's behavioral health funding streams
Community Mental Health and Substance Abuse Block Grants
The ARP offers states a total of $3 billion in key mental health and substance abuse dollars through their block grant programs with the Substance Abuse and Mental Health Services Administration (SAMHSA).
The Community Mental Health Services Block Grant program allows states and territories to provide comprehensive mental health services and address needs and gaps in existing treatment services for those with severe mental health conditions.
The Substance Abuse Prevention and Treatment Block Grant program allows states and territories to undertake programs and services to prevent and treat substance use disorder. This funding is being allocated by SAMHSA as a supplemental appropriation for federal fiscal year 2021, yet the ARP allows states to use the monies through September 30, 2025.
Communities and community providers that meet the criteria as Certified Community Behavioral Health Clinics (CCBHCs) will receive $400 million directly in grants. CCBHCs ensure evidence-based integrated addiction and mental health services, including 24/7 crisis response and medication-assisted treatment for addiction.
Behavioral health workforce recruitment and training
The ARP provides $80 million to the Health Resources Services Administration for grants and contracts to both public and private nonprofits to plan, develop, operate, or participate in health professions and nursing training in evidence-informed strategies for reducing and addressing suicide, burnout, and behavioral health impacts to the healthcare workforce.
Another $100 million is being allocated to colleges and other educational institutions for recruitment and training of clinical mental health and substance abuse workforce members.
In recognition of the impact of COVID-19 on the healthcare workforce, the ARP contains $20 million to fund an awareness campaign directed at healthcare professionals and first responders, encouraging them to seek treatment for their own mental health needs and to help health professionals identify risk factors in themselves and others.
Local community-based needs
The ARP provides a dedicated fund of $50 million to SAMHSA for grants to state, local, tribal, and territorial governments, tribal organizations, nonprofit community-based entities, and primary care and behavioral health organizations to address increased community behavioral health needs worsened by the COVID-19 public health emergency.
These funds will be used to promote care coordination among local entities; train the mental and behavioral health workforce, relevant stakeholders, and community members; expand evidence-based integrated models of care; address surge capacity for mental and behavioral health needs; provide mental and behavioral health services to individuals with mental health needs (including co-occurring substance use disorders) as delivered by behavioral and mental health professionals utilizing telehealth services; and support, enhance, or expand mental and behavioral health preventive and crisis intervention services.
The continuing impact of the opioid crises during the pandemic was also recognized in the ARP with $30 million targeted for grants to states, tribes, and nonprofits to support community-based overdose prevention programs, syringe services programs, and other services to reduce harmful behavior exacerbated by the pandemic.
Value-based crisis services
The ARP addresses a key need within the behavioral health continuum of care— mobile crisis services—in a new value-based model that is aimed at rapid expansion of these services to address the need in the community while avoiding unnecessary hospital emergency department visits.
With 85% federal funding share for the first 12 quarters of a 5-year commitment, states now have the ability through either a Medicaid waiver or state plan amendment to implement a new “bundled payment” for qualifying mobile crisis.
Centered around screening and assessment, stabilization and de-escalation, and coordination and referral to community-based services, this initiative can provide a pathway for states to enhance or redesign their crisis response services.
Planning for this new payment design will be key, and ARP provides $15 million in Department of Health and Human Services-distributed state planning grants.