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. Author manuscript; available in PMC: 2025 Mar 1.
Published in final edited form as: J Subst Use Addict Treat. 2023 Dec 8;158:209247. doi: 10.1016/j.josat.2023.209247

Introduction of Medicare Coverage in Opioid Treatment Programs: Findings from the First Three Years

Amanda J Abraham 1, Samantha J Harris 2, Courtney R Yarbrough 3
PMCID: PMC10947910  NIHMSID: NIHMS1952783  PMID: 38072386

Abstract

Background:

Prior to January of 2020, there was no Medicare reimbursement for services delivered in opioid treatment programs (OTPs). OTPs are the only authorized providers of opioid use disorder (OUD) treatment with methadone, a critical tool to address the opioid overdose crisis. While prior research has examined the availability of MOUD other than methadone for Medicare beneficiaries, research has not identified organizational and local Medicare beneficiary characteristics associated with Medicare insurance acceptance among OTPs.

Objectives:

This study has two objectives: 1) to determine the extent to which OTPs began accepting Medicare insurance in the first three years following the new Medicare OTP benefit; and 2) to identify organizational characteristics and local Medicare beneficiary characteristics associated with OTP acceptance of Medicare.

Methods:

We used data from the 2021–2023 National Directory of Drug and Alcohol Abuse Treatment Facilities to examine OTP acceptance of Medicare. We used logistic regression to identify organizational characteristics and local Medicare beneficiary characteristics associated with OTP acceptance of Medicare (n=4,630 OTPs).

Results:

By 2022, about 78.7% of OTPs accepted Medicare, compared to only 41.1% of non-OTPs. The odds of Medicare acceptance were lower among for-profit OTPs, compared to non-profit OTPs, and higher among OTPs that accepted Medicaid and private insurance. Additionally, the odds of accepting Medicare were lower for OTPs located in the Northeast, Midwest, and South, compared to OTPs located in the West. Finally, the odds of accepting Medicare were higher for OTPs located in counties with higher percentages of Non-Hispanic White Medicare beneficiaries.

Conclusions:

We found high rates of Medicare acceptance among OTPs in the first three years of the Medicare OTP benefit, suggesting increased access to OUD treatment via OTPs for Medicare beneficiaries. While promising, results indicate potential geographic and racial/ethnic disparities in access to OTPs.

Keywords: Opioid Treatment Program, Medicare, Treatment Access, Methadone

1. Introduction

Over the past two decades, opioid-related overdose deaths among older adults (55+) have dramatically increased, reaching an all-time high of 15.96 deaths per 100,000 in 2021 (Mason et al., 2022). While the prevalence of opioid use disorder (OUD) among Medicare beneficiaries has also risen sharply, in 2021 only an estimated 17.7% of Medicare beneficiaries with OUD received any medication for opioid use disorder (MOUD) (Office of Inspector General, 2022; Parish et al., 2022; Shoff et al., 2021).

Low rates of Medicare insurance acceptance among specialty substance use treatment programs are a major barrier to OUD treatment access among Medicare beneficiaries. In 2016, only 13.8% of all non-opioid treatment programs (non-OTPs) accepted Medicare and offered any MOUD covered by Medicare (i.e., buprenorphine and naltrexone) (Harris et al., 2020). Similarly, prior research indicates low availability of buprenorphine and naltrexone prescribers in Medicare Part D (Abraham et al., 2019). The same study also finds regional differences in access to both buprenorphine and naltrexone prescribers, as well as racial/ethnic disparities in access to buprenorphine prescribers (Abraham et al., 2019).

Lack of Medicare reimbursement for opioid treatment programs (OTPs) has been a critical gap in Medicare coverage of OUD treatment. OTPs are the only points of access to treatment with methadone in the United States. Methadone, associated with reductions in opioid use and increased treatment retention, is an essential tool to address the opioid overdose crisis (Nielsen et al., 2022). To close this OUD treatment coverage gap, a Medicare benefit category for OTPs was created under the SUPPORT Act. The Medicare OTP benefit category, effective January 1, 2020, allowed Medicare coverage for methadone and other OTP services for the first time (SUPPORT Act, 2018), expanding access to methadone for Medicare beneficiaries.

While prior research has examined the availability of MOUD other than methadone for Medicare beneficiaries (Abraham et al., 2019; Abraham et al., 2018; Harris et al., 2020) and county-level access to OTPs that accepted Medicare (Harris et al., 2023), research has not examined characteristics of OTPs and local Medicare beneficiary characteristics associated with the organizational decision to accept Medicare among OTPs. It is important to examine this topic as OTPs differ in their organizational structures and populations served which may affect their propensity to accept Medicare payments (Andrews et al., 2014; D’Aunno & Pollack, 2002). To address this gap in the literature, the current study has two objectives: 1) determine the extent to which OTPs began accepting Medicare insurance in the first three years following the new Medicare OTP benefit; and 2) identify organizational and local Medicare beneficiary characteristics associated with OTP acceptance of Medicare from 2020–2022.

2. Material and Methods

2.1. Data and Measures

We analyzed OTPs in the 2021–2023 National Directory of Drug and Alcohol Abuse Treatment Facilities (the Directory), which corresponds to data from the 2020 and 2021 National Survey of Substance Abuse Treatment Services (N-SSATS) and the 2022 National Substance Use and Mental Health Services Survey (N-SUMHSS). The Substance Abuse and Mental Health Services Administration (SAMHSA) published the directory, a list of facilities providing substance use treatment in the US. SAMHSA provides federal certification that permits an OTP to dispense methadone. Federal regulations restrict methadone administration and dispensing to federally certified OTPs. While non-OTPs cannot dispense methadone, these treatment programs may offer buprenorphine and naltrexone for OUD treatment. For comparison, we calculated the percentage of non-OTPs that accepted Medicare in 2020–2022 (n= 34,240 non-OTPs).

OTP acceptance of Medicare insurance was a dichotomous measure (0=OTP does not accept Medicare insurance, 1=OTP accepts Medicare insurance). We also included several organizational characteristics of OTPs including program ownership (private for-profit, private non-profit, or government owned), Joint Commission (JC) or Commission on the Accreditation of Rehabilitation Facilities (CARF) accreditation, whether the OTP offered outpatient or residential treatment services, whether the OTP offered detoxification, and whether the OTP accepted Medicaid and private insurance. All OTP characteristics were dichotomous variables.

The 2019–2021 Medicare Geographic Variation file provided county-level characteristics of Medicare beneficiaries, including average Medicare beneficiary age and average beneficiary Hierarchical Condition Category (HCC) score as well as the percentage of Fee-for-Service Medicare beneficiaries, female beneficiaries, dual-eligible beneficiaries, and Non-Hispanic White beneficiaries. We also included indicators for Census Region from the US Census Bureau (Northeast, Midwest, South, and West). We drew additional county characteristics from the 2019–2021 American Community Survey five-year estimates, including the percent of county residents living in rural areas, percent uninsured in the county, percent of county residents living in poverty, and the county unemployment rate. Finally, we included state-level, age-adjusted opioid-related overdose deaths rates among Americans 55 years and older from Centers for Disease Control and Prevention (CDC) WONDER for the years 2019–2021 (Centers for Disease Control and Prevention, 2020). This study lagged all county variables and state opioid-related overdose deaths by one year.

2.2. Statistical Analyses

First, we calculated descriptive statistics for all variables. Second, we used logistic regression with robust standard errors and year fixed effects at the facility level to identify organizational characteristics of OTPs and county Medicare beneficiary characteristics associated with OTP acceptance of Medicare from 2020–2022. Analyses excluded 100 OTPs with missing data on the dependent or independent variables over the study period (about 2.1% of all OTPs over the study period), resulting in a final sample size of 4,630. We used Stata version 17.0 to conduct analyses.

3. Results

In 2020, approximately 60.8% of OTPs reported accepting Medicare insurance in the first year of the new Medicare benefit, compared to 39.0% of non-OTPs. By 2022, about 78.7% of OTPs accepted Medicare, an almost 18.0 percentage point increase from 2020, compared to only 41.1% of non-OTPs. Figure 1 shows the percentage of OTPs that accepted Medicare by program ownership type and year. For-profit OTPs comprised the majority of OTPs, representing about 63.7% of OTPs in 2020 and 68.7% of OTPs in 2022. Over the study period, a higher percentage of non-profit OTPs accepted Medicare, compared to both for-profit and government owned programs. By 2022, 84.5% of non-profit OTPs accepted Medicare, compared to 77.6% of for-profit OTPs and 73.6% of government owned OTPs.

Figure 1: Percentage of OTPs Accepting Medicare by Year and Ownership Type, 2020–2022.

Figure 1:

Authors’ analysis of data from the 2021–2023 National Directory of Drug and Alcohol Abuse Treatment Facilities, corresponding with survey responses from 2020–2022.

In the adjusted logistic regression model (Table 1), the odds of accepting Medicare were lower among for-profit OTPs (AOR=0.71, p<.01) compared to non-profit OTPs. The odds of Medicare acceptance were also lower for OTPs offering residential treatment services (AOR=0.17, p<.001). The odds of Medicare acceptance were higher for OTPs accredited by the Joint Commission or the Commission on the Accreditation of Rehabilitation Facilities (AOR=2.06, p<.001), OTPs offering outpatient treatment services (AOR=1.37, p<.10), OTPs accepting Medicaid (AOR=12.08, p<.001), and OTPs accepting private insurance (AOR=3.14, p<.001).

Table 1:

Logistic Regression Predicting OTP Acceptance of Medicare, 2020–2022 (n=4,630)a

AOR (95% CI) p-value
Private for-profit 0.71 (0.57–0.87) 0.001
Government owned 0.88 (0.61–1.25) 0.469
Private non-profit (referent)
Accredited by JC/CARF 2.06 (1.57–2.72) 0.000
Offers outpatient services 1.37 (0.96–1.93) 0.079
Offers residential treatment services 0.17 (0.12–0.23) 0.000
Offers detoxification 1.05 (0.89–1.24) 0.572
Accepts private insurance 3.14 (2.65–3.73) 0.000
Accepts Medicaid 12.08 (9.58–15.25) 0.000
Northeast 0.34 (0.24–0.48) 0.000
Midwest 0.41 (0.28–0.60) 0.000
South 0.62 (0.43–0.90) 0.012
West (referent)
Percent FFS Medicare beneficiaries 1.00 (0.99–1.01) 0.802
Average Medicare beneficiary age 0.85 (0.79–0.92) 0.000
Percent female Medicare beneficiaries 1.12 (1.03–1.21) 0.008
Percent dual eligible Medicare beneficiaries 0.99 (0.97–1.00) 0.132
Percent Non-Hispanic White Medicare beneficiaries 1.01 (0.998–1.02) 0.083
Average Medicare beneficiary HCC score 3.43 (0.70–16.86) 0.130
Percent rural 1.00 (0.99–1.01) 0.580
Percent in poverty (65+) 1.02 (0.98–1.05) 0.336
Unemployment rate 0.99 (0.92–1.07) 0.810
Percent uninsured 0.98 (0.95–1.01) 0.126
Age-adjusted rate of opioid overdose deaths (55+) 0.99 (0.97–1.00) 0.119
2020 (referent)
2021 2.69 (2.21–3.28) 0.000
2022 3.19 (2.55–3.99) 0.000
a

Authors’ logistic regression analysis of data from the 2021–2023 National Directory of Drug and Alcohol Abuse Treatment Facilities (corresponding with survey responses from 2020–2022), Medicare Geographic Variation Public Use File (2019–2021), American Community Survey (2019–2021), and CDC WONDER (2019–2021). Note: 100 OTPs were excluded from the regression analysis due to missing data. AOR= Adjusted Odds Ratio; CI=Confidence Interval.

The odds of accepting Medicare were lower for OTPs in the Northeast (AOR=0.34, p<.001), Midwest (AOR=0.41, p<.001), and South (AOR=0.62, p<.05) versus the West. The odds of accepting Medicare were higher for OTPs in counties with higher percentages of Non-Hispanic White Medicare beneficiaries (AOR=1.01, p<.10) and female beneficiaries (AOR=1.12, p<.01), while the odds of accepting Medicare were lower for OTPs located in counties with older Medicare beneficiaries on average (AOR=0.85, p<.001).

4. Discussion

Results suggest that OTPs responded rapidly to the new Medicare OTP benefit. By 2022, approximately 78.7% of OTPs reported accepting Medicare. To put this finding in context, only about 41.1% of non-OTPs reported accepting Medicare in the same year, and the percentage of non-OTPs accepting Medicare did not increase significantly over the study period.

For-profit OTPs, which comprise approximately 83.7% of OTPs in the South in our sample, were less likely to accept Medicare than non-profit OTPs. This finding is consistent with prior studies which indicate lower levels of Medicaid insurance acceptance among for-profit OTPs as well as geographic disparities in access to OTPs that accept Medicaid, particularly in the South (Abraham et al., 2018; Abraham et al., 2021; Jones et al., 2019). Taken together, these results suggest disparities in access to methadone for both Medicare and Medicaid beneficiaries residing in the South.

Consistent with prior research, we observed an association between Medicare acceptance and Medicaid and private insurance acceptance in OTPs (Harris et al., 2020), suggesting that administrative experience with insurance claims is a potential facilitator for Medicare participation. In addition, the average weekly Medicare bundle fee for regular methadone treatment is substantially higher than the average weekly Medicaid bundle fee, thus OTPs stand to increase reimbursement by accepting Medicare insurance (Clemans-Cope et al., 2022). As more OTPs accept both Medicare and Medicaid insurance, it may be possible that positive spillovers are observed between Medicare and Medicaid reimbursement structures. For example, some fee-for-service Medicaid programs do not offer reimbursement for take-home doses of methadone; however, Medicare policies offer a specific reimbursement code for take-home doses. Future research should examine the interaction between these two programs now that Medicare is a payor for OTP services.

We also found that OTPs offering residential treatment services were less likely to accept Medicare, which is not surprising given that Medicare does not cover residential substance use treatment (Parish et al., 2022; Steinberg et al., 2021). To examine the relationship between OTP program quality and the likelihood of accepting Medicare, we used a proxy measure of program quality, program accreditation by JC or CARF (Andrews, 2014; D’Aunno & Pollack, 2002; Ducharme & Abraham, 2008; Mark et al., 2020). Consistent with prior research examining substance use treatment program acceptance of Medicaid insurance (Andrews, 2014), we found that higher-quality programs, as measured by JC/CARF accreditation, had higher odds of accepting Medicare.

Regression results also highlight potential racial/ethnic disparities in access to OTPs for Medicare beneficiaries, as we found a marginally significant positive relationship between OTP Medicare acceptance and the percentage of Non-Hispanic White Medicare beneficiaries in the county. This result is also consistent with prior studies of buprenorphine and naltrexone prescriber availability in Medicare Part D (Abraham et al., 2019), as well as studies examining access to MOUD in Medicaid and other patient populations (Dunphy et al., 2022; Mark et al., 2022).

Our results also indicate potential geographic disparities in the propensity of OTPs to accept Medicare, as we found that OTPs in the Northeast, South, and Midwest were less likely to accept Medicare insurance compared to OTPs in the West. Indeed, at the facility level, the percentage of OTPs that reported accepting Medicare insurance in the West (88.5%) was almost 13.0 percentage points higher than OTPs in the Northeast (75.6%) and the South (74.6%), and about 7.5 percentage points higher than OTPs in the Midwest (81.0%) in 2022. However, while we found that OTPs located in the West were more likely to accept Medicare, there are 1.5 times more OTPs that accept Medicare per capita in the Northeast compared to the West.

In contrast to a recent study, which found rural-urban differences in the likelihood a county had at least one OTP that accepted Medicare (Harris et al., 2023), we did not find a relationship between county rurality and the likelihood an OTP accepting Medicare. This difference is likely because the current study does not include counties without OTPs. We only examine counties with OTPs, almost all of which are predominantly urban.

Finally, Medicare acceptance among OTPs was not associated with opioid-related overdose death rates among older Americans measured at the state-level. This finding stands in contrast to results from a recent paper examining county-level access to OTPs that accepted Medicare (Harris et al., 2023). As discussed above, the current study examines the decision of OTPs to accept Medicare rather than the geographic distribution of such programs. It could be that the state measure of opioid overdose mortality does not adequately capture local treatment need among the Medicare population, or that an OTPs decision to accept Medicare is less driven by local treatment need (as measured by state level opioid-related overdose deaths) and more driven by organizational factors and characteristics of local Medicare beneficiaries. However, our current findings do suggest that in states with the highest need for MOUD, OTPs did not disproportionately begin to accept Medicare reimbursement relative to OTPs states with less MOUD need. Thus, further efforts may be needed to target OTP acceptance of Medicare in the communities with the highest need.

4.1. Limitations

This study has several limitations. First, the Directory does not list all facilities offering substance use treatment services. Only facilities identified by Single State Agencies and/or facilities responding to the prior year’s survey are listed. Second, we were not able to examine rates of MOUD prescribing or OUD treatment outcomes. Third, this study uses a repeated cross-sectional design, thus causality cannot be established. Fourth, the first year of the Medicare OTP benefit coincides with the onset of the COVID-19 pandemic, during which numerous policies were enacted including greater flexibility in take-home doses and expansion of telehealth services for Medicare beneficiaries (Centers for Medicare and Medicaid Services, 2023; Substance Abuse and Mental Health Services Administration, 2020). Fifth, this study did not examine whether overall travel time to MOUD for Medicare beneficiaries decreases because of the new Medicare OTP benefit. However, future research should examine whether access to OTPs for Medicare beneficiaries is associated with reductions in travel time to MOUD given that prior research identifies travel time as a major barrier to methadone access (Joudrey et al., 2020).

5. Conclusions

We found high rates of Medicare acceptance among OTPs in the first three years of the Medicare OTP benefit, suggesting increased access to OUD treatment via OTPs for Medicare beneficiaries. While promising, results indicate potential geographic and racial/ethnic disparities in access to methadone for Medicare beneficiaries. To address these disparities, the federal government should consider expanding methadone service delivery sites to include Federally Qualified Health Centers and/or pharmacy-based dispensing. Furthermore, we found that for-profit OTPs continue to dominate the OTP landscape and were less likely to accept Medicare than non-profit OTPs. Future research should examine whether the OTP Medicare benefit translates into improvements in care for Medicare beneficiaries with OUD.

Highlights.

  • We assess OTP Medicare acceptance in the first three years of the Medicare OTP benefit

  • By 2022, about 78.7% of OTPs accepted Medicare, compared to only 41.1% of non-OTPs

  • For-profit OTPs were less likely than non-profit OTPs to accept Medicare

  • Results indicate potential geographic and racial/ethnic disparities in OTP access

Funding:

This work was supported by the National Institutes of Health [grant numbers UL1TR002378, R01DA047365].

Footnotes

Conflicts of interest

The authors have no conflicts of interest to report.

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