Drug Medi-Cal Organized Delivery System

California’s pilot to overhaul substance use disorder treatment in Medi-Cal


Why This Work Matters

California’s Medi-Cal program is modernizing its system for treating people with substance use disorders (SUDs). This effort to expand access and improve quality is sorely needed and stands to help millions of people get care.

SUD is a common chronic illness. Nearly three million people — more than 8% of California’s residents — reported meeting criteria for an SUD in the past year. The most common SUD is alcohol use disorder, which affects three in four Californians who have an SUD. About one in three people with an SUD meets criteria for misuse of, or dependence on, illicit or prescription drugs. Young people are especially hard hit, with 18- to 25-year-olds having dramatically higher rates of SUD than other age groups.

Background

Appropriate SUD treatment in Medi-Cal, as it is in the private health care system, has long been difficult to access. In Medi-Cal, SUD treatment is run by individual counties through a program separate from medical care called Drug Medi-Cal. This program provides a limited set of treatment services. Access is poor, reimbursement rates are low, and quality is highly variable.

To overhaul its SUD treatment system, California’s Department of Health Care Services applied for and received the nation’s first Medicaid Section 1115 waiver to implement an SUD demonstration program. This undertaking, named the Drug Medi-Cal Organized Delivery System (DMC-ODS) pilot program, means that for the first time, Medi-Cal patients needing treatment are being assessed according to nationally recognized criteria and referred for treatment according to their individual needs. Other states are making similar efforts. Vox profiled Virginia’s program, which is similar to DMC-ODS.

Approach

The goal of DMC-ODS is to reorganize the SUD treatment system using a continuum of care modeled on the American Society of Addiction Medicine criteria for SUD treatment. First developed in 1991, these criteria are used by SUD specialists across the country to create individualized, comprehensive treatment plans. The range of services provided by DMC-ODS is much broader than what has been available under the Drug Medi-Cal program, and requires evidence-based treatment from providers.

Participation in DMC-ODS is voluntary, and 40 of California’s 58 counties are participating. As of July 1, 2018, 19 counties are providing services under the pilot, representing nearly 75% of the Medi-Cal population statewide. When the remaining 21 counties that have submitted implementation plans to participate begin services, over 97% of Medi-Cal enrollees will have access to a DMC-ODS pilot program. Counties that choose to participate operate as a managed care plan for SUD treatment, setting their own rates for each covered service and contracting with providers to deliver care.

DMC-ODS has been described as a once in a generation opportunity to advance SUD treatment by organizing care, expanding services, and integrating treatment into the larger health care system. CHCF is proud to be working with state agencies, county governments, and other partners to help launch the county DMC-ODS pilots, understand what works, and address remaining challenges to increasing access for people in need of these critical health care services. Our work in this area is described below.

Landscape and Publications

  • A report from Harbage Consulting explains how DMC-ODS works and why it is so important for patients, with a focus on Riverside, Los Angeles, Marin, and Santa Clara Counties. Also available are a brief overview of the program (PDF), and a brief summary of the impact the program has had on treatment of substance use disorder (PDF).
  • A CHCF Almanac report describes the prevalence of SUDs in California, and the existing treatment system and gaps (to be published in summer 2018).
  • CHCF commissioned a report that emphasizes the need and right that adolescents have to access SUD treatment through Medi-Cal.
  • The UC Berkeley Institute of Governmental Studies conducted a statewide poll that showed Californians’ support for insurance coverage for SUD treatment and their belief that such treatment can help people with substance use disorders lead “healthy and productive lives.”

Technical Assistance

  • CHCF is supporting the Department of Health Care Services’ implementation of DMC-ODS in counties and in the Indian Health Program Organized Delivery System.
  • The University of California, Los Angeles, Integrated Substance Abuse Programs are conducting an expanded evaluation of DMC-ODS pilots.
  • Federal and state law complicates data-sharing for patients receiving SUD treatment, which can be a challenge to integrating care. CHCF has published several legal papers to explain the legal and regulatory landscape.

CHCF’s work on DMC-ODS is part of our focus on improving access to care and coverage. It also complements CHCF’s effort to address the opioid epidemic, a component of which focuses on increasing access to integrated addiction treatment.

For more information, please contact Catherine Teare, associate director of high-value care at CHCF.