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The Crucial Role Medicaid and Social Workers Play in Providing Access to Substance Use Treatment

Makeba Royall, LCSW Senior Practice Associate, Behavioral Health

May 2025

Introduction

Medicaid is an insurance plan that provided access to care to 78 million people to include those with limited income, children and families, pregnant women, people with disabilities and people in long term care facilities. Medicaid has not only provided access to medical care, but it has also played a significant role in access to substance use treatment. In March 2025, Congress recommended reducing the budget to $880 billion over the next 10 years which would impact the role Medicaid plays in providing critical services to individuals with mental health and substance use conditions. This behavioral health practice tool highlights the importance of Medicaid assistance for those who are dealing with substance use disorders and why cutting Medicaid would further harm the communities in which we serve as social workers.


Substance Use Treatment

Although Medicaid differs from state to state, “states expanded coverage for substance use disorders (SUD) services in recent years” (Guth et al., 2023), and Medicaid covers services that are essential for treatment and recovery efforts related to substance use disorders. With the use of Medicaid, enrollees have been able to receive detoxification, inpatient rehabilitation, partial hospitalization, intensive outpatient, and residential services. In a recent 2021 report to Congress the following data was provided:

More than three-quarters (78 percent) of Medicaid beneficiaries treated for a SUD in 2021 received at least one service in an outpatient setting, and 42 percent received at least one service in an inpatient setting during the year. Nearly half of Medicaid beneficiaries treated for a SUD (43 percent) in 2021 received emergency services, which was the most common type of SUD service provided during the year. Less than one-third (28 percent) of beneficiaries treated for a SUD who received care in an inpatient or residential setting in 2021 also received at least one outpatient or home- or community-based SUD service within 30 days of being discharged (Becerra & U.S. Department of Health and Human Services, 2023).

In addition to hospital based or outpatient care, Medicaid has played a vital role in care coordination efforts with the use of community-based organizations that often assist with bridging the gap between follow-up care in hospital and outpatient settings. Becerra & U.S. Department of Health and Human Services (2023), reported, “among the Medicaid beneficiaries treated for an opiate use disorder (OUD) who received any SUD service in an inpatient or residential setting during 2021, 57 percent received at least one outpatient or home- or community-based service within 30 days of discharge; 46 percent of this same group received two or more of these services. These rates of follow-up care after discharge from an inpatient or residential setting are substantially higher than for Medicaid beneficiaries treated for a SUD more generally.”

According to the data Medicaid’s importance and value to the community is crucial and it ensures access to care, improvement in wellness and more importantly supports recovery efforts. According to Saunders et al. (2024), “counseling/therapy, medication and other services (including screening/assessment) have the highest utilization rates” amongst Medicaid enrollees.


Impact of Potential Medicaid Cuts

Medicaid enrollees may experience difficulties accessing care due to the possibility of a reduction in funding, which could have an effect on millions of people. According to Saunders et al. (2023) mild, moderate, or severe mental health or substance use disorders affect 39% of Medicaid enrollees, which is a significant percentage. National Alliance on Mental Illness (NAMI) reports Medicaid pays for one in four dollars spent on mental health and substance use care (National Alliance on Mental Illness, n.d.). Those with substance use disorders are put in a vulnerable situation when Medicaid funding is eliminated. Without the support of Medicaid, enrollees, families, and children who are living with substance use conditions may have limited access to care, leaving them without therapeutic support and care coordination services. Additionally, Medicaid funding impacts community work, which is the core of the social work profession.


How Social Workers Help

Social workers have been called to provide crisis intervention through mobile crisis, 988 and other crisis hotlines to deal with community engagement and support that includes substance use and mental health conditions. Nearly three-quarters of responding states (33 of 45) reported mobile crisis coverage for adults in fee-for-service FFS programs (Saunders et al., 2023b). And while “the financing of crisis response systems is still emerging, with Medicaid currently a main insurer reimbursing for crisis services” (NRI, Inc., 2023), the ability of states to continue providing their already limited services to help address the substance use and mental health needs of the community would be impacted by concerns about funding for these services if Medicaid funding is cut.

As social workers we are tasked to manage an already difficult, complex, and underfunded crisis. As we navigate the multitude of changes happening during this Presidential term our advocacy efforts will be essential to the profession and the communities in which we serve. Social workers assist in navigating social determinants of health disparities. Our ability to address treatment disparities and access to care associated with social determinants of health is hampered by declining Medicaid funding. Now it is our moment to take the lead and share our knowledge of how insurance coverage is essential to the integration of preventive, affordable health care and health.

As we continue to keep an eye on the budget, let us make sure to closely watch any changes that occur both nationally and in your state.

  • Discuss with your employers the impact this can have on the individuals, children, and families you are working with and further explore the contingency plan if a decline in funds impacts substance use treatment efforts.
  • Research grant opportunities that may generate funding to help support your efforts.
  • Increase collaboration efforts by sharing resources and referring individuals to local organizations and healthcare providers.
  • Utilize and inform individuals about sliding fee scales.
  • Offer pro bono services to those with hardships and without medical insurance.
  • Advocate and raise community awareness regarding the potential impact of funding cuts. Urge congress to protect Medicaid by calling and writing letters to Congress, sharing our stories, and continue to raise awareness about the importance of Medicaid funding priorities that help with prevention, treatment and recovery efforts related to substance use. Please visit NASW Action Center (https://www.socialworkers.org/Advocacy/Action-Center), which currently has an action alert urging members of Congress to protect Medicaid.


NASW Resources

Threats to Medicaid and Medicare: Potential Impacts on Vulnerable and Marginalized Populations


Resources

Becerra, X. & U.S. Department of Health and Human Services. (2023). T-MSIS Substance Use Disorder (SUD) Data Book. In Report to Congress. https://www.medicaid.gov/medicaid/data-systems/downloads/2021-sud-data-book.pdf

December 2024 Medicaid & CHIP Enrollment Data Highlights | Medicaid. (n.d.-b). https://www.medicaid.gov/medicaid/program-information/medicaid-and-chip-enrollment-data/report-highlights

Guth, M., Saunders, H., Niles, L., Bergefurd, A., Gifford, K., & Kennedy, R. (2023, May 25). How do States Deliver, Administer, and Integrate Behavioral Health Care? Findings from a Survey of State Medicaid Programs | KFF. KFF. https://www.kff.org/mental-health/issue-brief/how-do-states-deliver-administer-and-integrate-behavioral-health-care-findings-from-a-survey-of-state-medicaid-programs/

National Alliance on Mental Illness. (n.d.). Proposed Cuts to Medicaid Deeply Unpopular Across Party Lines, New NAMI-Ipsos Poll Finds | NAMI. NAMI. https://www.nami.org/press-releases/proposed-cuts-to-medicaid-deeply-unpopular-across-party-lines-new-nami-ipsos-poll-finds/

National Alliance on Mental Illness. (2025, April 10). Medicaid State Fact Sheets | NAMI. NAMI. https://www.nami.org/advocacy/state-fact-sheets/medicaid/

NRI, Inc. (2023). Financing Behavioral Health Crisis Services: 2022. https://www.nri-inc.org/media/pa3i4qjl/financing-bh-crisis-services-update-4-3-23.pdf

Medicaid & Mental Health One-Pager

Saunders, H., Euhus, R., Burns, A., & Rudowitz, R. (2024, March 28). SUD Treatment in Medicaid: Variation by Service Type, Demographics, States and Spending | KFF. KFF. https://www.kff.org/mental-health/issue-brief/sud-treatment-in-medicaid-variation-by-service-type-demographics-states-and-spending/

Saunders, H., Guth, M., & Panchal, N. (2023, May 25). Behavioral Health Crisis Response: Findings from a Survey of State Medicaid Programs | KFF. KFF. https://www.kff.org/mental-health/issue-brief/behavioral-health-crisis-response-findings-from-a-survey-of-state-medicaid-programs/