Needs Assessment Methodologies in Determining Treatment Capacity for Substance Use Disorders: Environmental Scan Final Report. RESULTS III: HOW STATES OPERATIONALIZE NETWORK ADEQUACY STANDARDS


This section presents information obtained through a separate process in the environmental scan, reviewing procedures and policies related to network adequacy standards in selected states. Network adequacy standards established by the states reflect the "what should be" condition in a needs assessment as defined (at least implicitly) at the level of state policy making.

On May 6, 2016, CMS published the Medicaid and Children's Health Insurance Program Managed Care Final Rule (Managed Care Rule) which revised Title 42 of the Code of Federal Regulations (CFR) to include language that required states to develop network adequacy standards and ensure adequate provider capacity for their Medicaid program. Specific language in these regulations requires states to develop and assess standards for certain specialty services including behavioral health (mental health and SUD services). These changes aimed to align Medicaid managed care regulations with requirements of other major sources of coverage. There are three parts of the Managed Care Rule that comprise the majority of network adequacy standards: Title 42 of the CFR Part 438.68 Network adequacy standards, Part 438.206 Availability of services, and Part 438.207 Assurances of adequate capacity and services. Each of these parts is described below.

Network Adequacy Standards--Time and Distance

Part 438.68, Network adequacy standards, requires states to develop time and distance standards for adult and pediatric behavioral health (mental health and SUD treatment) providers. Time means the number of minutes it takes a beneficiary to travel from the beneficiary's residence to the nearest provider site. Distance means the number of miles a beneficiary must travel from the beneficiary's residence to the nearest provider site. While states are required to establish time and distance standards, Plans are required to meet the standards for time or distance. For example, some states require that SUD services must be within 15 miles from the beneficiary's residence or within a 30-minute drive from the beneficiary's residence.

Network Adequacy Standards--Timely Access

Part 438.206, Availability of services, requires the Plans to meet state standards for timely access to care and services, taking into account the urgency of the need for services. Timely access standards refer to the number of business days in which a Plan must make an appointment available to a beneficiary from the date the beneficiary, or a provider acting on behalf of the beneficiary, requests a medically necessary service.

Network Certification Requirements

Part 438.207, Assurances of adequate capacity and services, requires each Plan to submit documentation to the state Medicaid agency to demonstrate that it complies with the following requirements:

  • Offers an appropriate range of services that is adequate for the anticipated number of beneficiaries for the service area (i.e., as defined by the state).

  • Maintains a network of providers, operating within the scope of practice under state law, that is sufficient in number, mix, and geographic distribution to meet the needs of the anticipated number of beneficiaries in the services area.

Some states are using newer approaches to determine if they have sufficient capacity to meet the needs of beneficiaries with SUD; California and North Carolina are described below. The North Carolina example illustrates how the state required Plans to use the assessment to identify service gaps and strategies for addressing these gaps.


The California Department of Health Care Services (DHCS) has developed and will be putting into place (in July 2018) a process to implement the federal managed care regulations regarding time, distance, and timely access to SUD services included in the Drug Medi-Cal program. This includes that SUD managed care plans document that it meets the federal network adequacy requirements. DHCS also incorporated state legislation from the fall of 2017 that codified the federal managed care requirements for Medi-Cal including the Drug Medi-Cal program.

DHCS has developed a tool for counties (who are the state's Drug Medi-Cal Plans) to assess the adequacy of the SUD provider network against the needs of Medi-Cal beneficiaries with an SUD. Specifically, the state has developed a Network Adequacy Certification Tool (NACT) for Plans to collect information on location, current capacity, and projected capacity of SUD providers. The NACT collects information on:

  • The site (physical location) of each organization that renders SUD services--this includes county owned and operated facilities and other contracted network provider sites.

  • The type of SUD provider that renders the service (individual practitioners, outpatient clinics, intensive outpatient programs, residential programs, and opioid treatment programs).

  • The age group served, hours of operation, FTE of practitioners, licensed capacity for Opioid Treatment Programs (OTPs), distance between site and closest public transportation, telehealth capabilities, and language capacities.

  • Current number of Medi-Cal beneficiaries served by the provider and the maximum number of Medi-Cal beneficiaries the provider will accept. It also collects information regarding the projected utilization of Drug Medi-Cal services for the following year.

The NACT also requires the Drug Medi-Cal Plan to summarize the provider count for the geographic areas they serve (by provider type and age group) as well as provide the expected utilization for the following modalities: outpatient SUD clinics, intensive outpatient program and OTPs. Information regarding the NACT will be included in the Final Report.[8]

Using the information from the NACT, the Plan must submit to DHCS geo-access maps of all the network providers in the Plan's service area. The map must plot the time and distance for all SUD network providers, stratified by service type, and geographic location using beneficiary addresses, provider addresses and time (minutes)/distance (miles) standards set forth by the state. The Plan also has to provide information on the number and percent of Medi-Cal beneficiaries with SUD that were without access to SUD services. The state has established the following time and distance standards for SUD services:

  • Outpatient services (three tiers)--for more populated counties the standard is up to 15 miles or 30 minutes from a beneficiary's place of residence; for less populated counties the standard is 30 miles or 60 minutes from a beneficiary's place of residence; for sparsely populated counties the standard is 60 miles or 90 minutes. The time and distance standards identify which counties fall into which of the three tiers.

  • OTPs (four tiers)--same tiers the state has developed for outpatient services, but between the second and third tier this is another tier that has an access requirement of 45 miles or 75 minutes. The time and distance standards identify which counties fall into which of the four tiers.

Access standards for outpatient SUD services are appointments within ten days from the request for services; for OTPs, the standard is within three days from request to appointment. The distance and time variance for OTPs is based on the beneficiaries need in an OTP to receive their medication daily, since imminent withdrawal will occur without such medication.

North Carolina

Similar to California, the North Carolina Department of Health and Human Services (DHHS) has developed network adequacy and access requirements for its behavioral health managed care plans that are based on standards reflected in the final federal Medicaid rule. However, North Carolina requests that the plans use this information to identify the gaps in network adequacy and accessibility as well as strategies to address the identified gaps. DHHS has developed a tool that set forth requirements for Local Management Entities-Managed Care Organizations (LME-MCOs) to conduct a Community Behavioral Health Service Needs, Providers and Gaps Analysis. The Division of Mental Health, Developmental Disabilities and Substance Abuse Services and the Division of Medical Assistance--both Divisions within DHHS --have contracts with LME-MCOs containing requirements for assessments of community need, availability of providers, and gaps in services. DHHS requires LME-MCOs to develop a strategic plan to address gaps for Medicaid and non-Medicaid beneficiaries. The tool is used to collect and analyze information across both mental health and SUD services using five categories: outpatient services (including individual practitioners), location-based services (e.g., IOP, OTPs), community/mobile service (mobile crisis and employment services for SUD), site-based crisis services including detoxification, inpatient services, and specialized services (SUD residential treatment). The tool collects information on:

  • Number of providers that are accepting new consumers (Medicaid and non-Medicaid).

  • Number of consumers (Medicaid and non-Medicaid) with choice of two providers within 30 miles/45 minutes.

  • Medicaid and non-Medicaid beneficiaries' (individuals with low income served with state general revenue and federal block grant funds) access to services.

Each LME-MCO must provide geo-maps for each Medicaid-funded service listed in the requirements. The LMEs-MCOs are also required to provide additional information for the Gaps/Needs Analysis, including the size/geographic location/distribution of specific cultural and special populations. The plan must describe the obstacles and barriers to serving these populations and the gaps they experience in accessing SUD services.

The LMEs-MCOs are required to discuss the gaps they find from the administration of the tool with local leaders, staff, and consumers of SUD organizations. This includes:

  • A description of methods used to get input from consumers and family members regarding service needs, gaps and strategies, including efforts to achieve geographic and disability-specific representation.

  • The service gaps in the SUD service system that were identified by consumers and family members.

  • The methods used to get input from stakeholders other than consumers and family members regarding service needs, gaps and strategies and the SUD service gaps were identified by other stakeholders.

A copy of the 2018 North Carolina Network Adequacy and Accessibility Analysis Requirements Tool will be included in the Final Report.[9]