As the state struggles with suspected Medicaid fraud, waste, and abuse, the Maryland Department of Health stated Thursday that new licenses for specific addiction and mental health providers will be suspended for an additional six months.
The moratorium, which was initially scheduled to end this year, was first announced in June in response to the rapid expansion of new providers. Licenses for intense outpatient treatments, partial hospitalization, and mental rehabilitation are all impacted.
The Banner, in partnership with The New York Times Local Investigations Fellowship, disclosed on Friday that state officials had neglected to adequately screen and audit addiction treatment providers for years, resulting in an influx of new programs, some of which employed practices that officials characterized as dishonest and unlawful.
The inquiry focused on PHA Healthcare, a government-funded program for addiction treatment that placed patients in free housing where many overdosed and relapsed while offering little assistance. Since 2022, the program has been connected to at least 13 fatalities.
The state is attempting to resolve issues in the field by halting the issuing of new permits. In a news release on Thursday, the health department stated that it is also revising regulations, switching to a new Medicaid payment processor, examining potentially underutilized services, and looking into new, less expensive services.
“Quality behavioral health care for Marylanders continues to be a top priority of the Department,” Alyssa Lord, the state’s deputy secretary of behavioral health, said in a statement. “This pause is one essential part of a larger plan to ensure much-needed oversight and compliance of new provider applications and protect Marylanders in need of behavioral health services.”
The extension is not surprising, according to a statement released Thursday by Shannon Hall, executive director of the Community Behavioral Health Association of Maryland, which applauded the license pause earlier this year. Hall stated that she thinks “substantial progress toward effective provider management will be coming soon” since a new Medicaid payments vendor will begin operations on January 1.
