Federal Rule Blocks Many Rehabilitation Facilities from Treating People Covered Under the Affordable Care Act

The Affordable Care Act (“ACA”) allows states to expand Medicaid to cover more low-income individuals, as well as cover alcohol and substance abuse treatment programs. However, a Federal rule enacted half a century ago prohibits Medicaid coverage for “community based” rehabilitation facilities that have more than 16 beds. As a result, many facilities are unable to provide treatment to the increased number of individuals now eligible for substance abuse treatment under the ACA’s Medicaid expansion. Although some facilities have sacrificed beds to fit within the guidelines and others have simply absorbed the cost of taking in more patients, only Congress has the power to change the rule to provide Medicaid coverage for larger treatment facilities.

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