Should Medicaid rates be a top priority?

New Hampshire’s Medicaid program sets the rates for how much it will reimburse providers for a service, which is like the way insurance companies negotiate prices with health care providers. Some lawmakers believe New Hampshire needs to significantly raise the reimbursement rates for mental health.

Mental health reimbursement rates in NH

New Hampshire has not raised its Medicaid reimbursement rates for mental health since 2006.  The rates are well below the national average and are only about 58% of the rates paid by private insurers.

Last year, the Department of Health and Human Services (DHHS) used $6 million in one-time funds to temporarily raise Medicaid reimbursement rates for mental health services.  They requested an additional $6 million in the next two budget years to maintain those higher rates.  However, the New Hampshire 10-Year Mental Health Plan recommends an additional $3 million each year to raise New Hampshire’s rates to the national average. 

Gov. Chris Sununu’s budget proposal covers the minimum requested by DHHS.  Some lawmakers believe that is not enough – they want that extra $3 million a year, or more. 

One bill in the Legislature, SB 5, makes an immediate contribution of $3 million to raise mental health reimbursement rates for the rest of this fiscal year. Legislators may also decide to raise the reimbursement rates through their own budget proposals. 

Arguments to prioritize a rate increase

Low Medicaid reimbursement rates contribute to the shortage of community mental health care providers.

According to the state’s 10-Year Mental Health Plan, “Low reimbursement rates translate into lower salaries, limited benefit [sic] and ultimately, into migration of the needed workforce out of the state.”

This shortage of community mental health providers means residents have trouble finding treatment. Patients are more likely to end up in crisis in the emergency room, waiting for one of the state’s in-patient beds to open.  The state is currently facing a lawsuit over people waiting for mental health treatment in emergency rooms.

Mental health is also related to the state’s opioid crisis, since people may turn to opioids and other drugs as a way to self-medicate.

After Sununu’s budget address, Deputy Speaker Karen Ebel said:

“The governor’s budget address completely omitted any mention of New Hampshire’s ongoing opioid crisis. It is irresponsible to leave out this critical issue and a complete oversight to fail to include the current bipartisan efforts to address this epidemic, and our state’s mental health crisis, by increasing provider reimbursement rates for mental health services and substance use disorder treatment which will ensure Granite State families are able to get the help that they need, and New Hampshire providers can afford to deliver that vital care.”

Arguments against a big rate increase

A big increase in Medicaid reimbursement rates for mental health is hardly a silver bullet to solve the shortage of mental health providers, however.

The state’s low unemployment rate and high college education costs contribute to the shortage of mental health care workers.  Overall, private insurance also tends to reimburse mental health services for less than other health care services.  

New Hampshire might attract more mental health care workers to the state by:

• having mental health service providers combine their employees into a single benefit pool, which might improve their ability to buy better affordable benefits; 
• establishing a student loan repayment program for mental health workers;
• pursuing higher private insurance fees for mental health services;

• improving licensure reciprocity with other states;
• and more.

The governor’s budget also includes investments in many other mental health initiatives, including two-thirds of the recommendations in the 10-Year Mental Health Plan.  For example, his budget includes $40 million for a new secure psychiatric hospital, which will move patients out of the state prison.

Learn more about New Hampshire's Medicaid reimbursement rates

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