Maryland's Medicaid reform: Will the gain outweigh the pain?

Abstract

J 1, 1997, marked the first day of chaos in Maryland’s public mental health system, when the state enacted its Medicaid 1115 waiver proposal. Literally overnight the entire system—for both general medical care and mental health care—underwent enormous changes in service delivery. The waiver, approved by the Health Care Financing Administration, allows the state to combine multiple state and federal health care funds and bypass traditional Medicaid regulations. Maryland is not alone in this initiative; nearly every state in the country either has or is proposing a Medicaid grant waiver in an attempt to control the skyrocketing costs of Medicaid. According to the director of Maryland’s Mental Hygiene Administration, the new mental health system is seen as a model for other states. Yet in Maryland the system changes continue to be controversial. Many providers are concerned that new fiscal and administrative burdens have undermined their ability to serve patients. This column focuses on how policy decisions have affected clinical service and practice during the first few months of implementation of the Medicaid waiver, as well as on the important questions that remain to be answered.