Closing a Critical Coverage Gap in Medicare
In 2024, following stalwart efforts by Congress, the Centers for Medicare & Medicaid Services, providers, advocacy organizations, and directly-impacted communities alike, Medicare closed a gap in its addiction treatment coverage by adding a benefit for intensive outpatient treatment programs (IOPs) for the treatment of mental health conditions and substance use disorders (SUDs), including opioid use disorder (OUD). Less than two years later, this move is already helping people nationwide. Much more than a technical adjustment, this coverage expansion is actively catalyzing better clinical outcomes, smarter spending, and broader access to lifesaving care.
Evidence of Unequal Access to OUD Treatment in Medicare
Although approximately 2 million Medicare beneficiaries have an OUD, research shows that they are far less likely to receive quality treatment than people who are enrolled in Medicaid. Moreover, Medicare beneficiaries ages 65 and older with OUD are less likely to access appropriate treatment than beneficiaries under age 65. For example, in 2020, only 8% of older beneficiaries with OUD received medications for opioid use disorder (MOUD), compared to 25% of younger beneficiaries, although both are still far below the Medicaid rate (57%).
Medicare beneficiaries cite financial barriers as a key reason for not receiving the SUD care they need, which is consistent with other findings that those who receive subsidies to pay for their prescription medications are more likely to receive MOUD. That is why comprehensive insurance coverage of the full continuum of SUD care is so vital—and the new coverage of IOP in Medicare is already having an impact on older adults, as well as other patients.
Real-World Results from IOP Integration
Through my (Mr. Shaheen’s) integration at New Season of IOPs into opioid treatment programs (OTPs), I have seen firsthand how thousands of patients’ lives are changing for the better. Patients participating in IOPs—defined as nine to nineteen hours per week of individualized treatment including group and individual counseling—showed dramatically higher engagement and compliance with treatment plans.
On the standardized BARC-10 scale, which measures the likelihood of sustained recovery, IOP patients increased their scores by 4.56 points, a clinically significant jump that moves many patients above the threshold associated with long-term recovery. Additionally, employment rates, housing stability, family reunification, and outcomes related to probation and child welfare systems all improved among IOP patients.
Implications for the Overdose Crisis Among Older Adults
For those of us steeped in this work, the results are unsurprising. We have long known that recovery is not one-size-fits-all, and as such, it is paramount that all patients have access to the full spectrum of evidence-based substance use treatment, including IOPs.
If we are serious about addressing the persistent overdose crisis, including among seniors whose rate of fatal overdose has increased by an alarming 400% in the last two decades, we must eliminate the health insurance barriers that keep far too many from obtaining the care they need to become and stay well.
Spillover Effects Across Payers and States
Today, New Season operates more than 50 IOPs within OTPs across nearly a dozen states, including Florida, New Hampshire, Georgia, Ohio, and New Mexico. Uptake among Medicare beneficiaries has been enormous, demonstrating pent-up demand among older adults and people with disabilities who previously had few affordable options.
In Florida, for example, armed with Medicare’s new IOP benefit, I (Mr. Shaheen) successfully made the case with several Medicaid managed care plans in the state that covering planned, evidence-based treatment is not only clinically effective, but it is far less expensive than paying for repeat emergency room visits and long-term hospitalizations. The logic resonated. Medicare’s leadership created leverage that improved care access across Medicaid and, eventually, private insurance plans. This is not just compassionate policy—it is fiscally responsible health care.
Remaining Gaps in Medicare’s SUD Benefit Design
Yet gaps remain. Medicare still does not cover residential substance use treatment, keeping the full continuum of care out of reach for most older adults. Additionally, IOP is still not available in all settings of treatment, including many community-based SUD treatment clinics that serve patients outside of OTPs. Regulatory hurdles—such as requirements for separate entrances—likewise continue to constrain access. And prior authorizations, especially in Medicare Advantage, can delay care by days, which can unfortunately be a death sentence for those in crisis.
Policy Considerations Moving Forward
These gaps are unacceptable as more than 6 million Medicare beneficiaries struggle with SUDs. Medicare’s addition of IOP coverage, including within OTPs, illustrates the profound success of expanding access to care and reasserts the urgent need to address all remaining gaps and barriers.
When insurers cover the full spectrum of evidence-based SUD treatment, patients do better, and systems save money. Medicare’s IOP coverage proves what is possible. Medicare must continue down this path of expanding coverage and reducing financial barriers to SUD treatment, and all insurers—public and private—must promptly follow suit so that every American can access and afford the specific care they need, when they need it most.
Jim Shaheen is the Chairman of the Board of the National Association of Behavioral Health and the CEO of New Season Treatment Centers, which provides comprehensive outpatient care for opioid use disorder.
Deborah Steinberg is a senior health policy attorney at the Legal Action Center, advocating at the state and federal levels to expand access to comprehensive and equitable substance use disorder and mental health care.
