CMMI’s Innovations in Behavioral Health: Promoting Physical and Mental Well-being

Health Highlights


Information about the model was gathered from CMMI’s IBH website, fact sheet, press release, and February 29 webinar.

On January 18, 2024, the Center for Medicare and Medicaid Innovation (CMMI) at the Centers for Medicare and Medicaid Services (CMS) announced Innovations in Behavioral Health (IBH), a new eight-year model focused on adult Medicaid and Medicare enrollees with moderate to severe mental health conditions and substance use disorders (SUD). CMS released substantial additional information about the model during a February 29 webinar and intends to release a notice of funding opportunity (NOFO) in Spring 2024.1 IBH will provide funding for states to work with behavioral health practices to develop and implement new care delivery models, with a focus on care management, that aim to integrate physical and behavioral health. The IBH care delivery model must be accompanied by a value-based payment (VBP) methodology. Consistent with CMMI’s “Strategy Refresh,” IBH adds to CMMI’s growing portfolio of Medicaid and Children’s Health Insurance Program (CHIP)-focused models – including the States Advancing All-Payer Health Equity Approaches and Development (AHEAD) model, Transforming Maternal Health (TMaH) Model, and the Cell and Gene Therapy Access model.

State Medicaid agencies will administer the IBH model in partnership with state agencies that oversee mental health and SUD services and Medicaid managed care plans where relevant. Up to eight states will be eligible to receive up to $7.5 million in cooperative agreement funding over the course of the model’s eight-year implementation timeline, which is slated to begin in the fourth quarter of 2024. Cooperative agreement funding will be used to build capacity at both state Medicaid agencies and behavioral health practices. Participating behavioral health practices will have the option of participating in IBH for only their Medicaid populations or for both their Medicaid and Medicare populations. CMS aims for IBH to produce the following outcomes:

  • Enhanced quality and delivery of whole person care
  • Increased access to behavioral health, physical health, and health-related social needs (HRSN) services
  • Improved health and equity outcomes
  • Fewer avoidable emergency department and inpatient visits
  • Strengthened health information technology systems capacity

Key Features of IBH

At its core, IBH establishes a care delivery framework for states to create integrated models of care, with a focus on care management, for adults with significant mental health and SUD needs; requires the use of a VBP methodology to reimburse for a state’s care model; and provides financial support for states and practices to be successful in this new paradigm. Key features of the IBH model are described below.

  • Behavioral Health Provider Participation Requirements: State Medicaid agencies will recruit licensed, Medicaid-enrolled behavioral health practices that offer outpatient mental health and/or SUD treatment services to participate in the IBH model. A wide variety of provider types may be eligible to participate, including Certified Community Behavioral Health Clinics (CCBHCs), community mental health centers, tribal health organizations, outpatient opioid treatment programs, federally qualified health centers, and independent practitioners.
  • Care Delivery Framework: CMS’s IBH care delivery framework offers states flexibility in how they structure their care model, while requiring several key components, including:
    • Care Integration – Behavioral health practices participating in IBH must integrate certain aspects of physical health care into their care delivery. Specifically, CMS requires that practices screen and assess patients for both physical and behavioral health conditions; make closed loop referrals for physical health services; conduct person-centered planning and treatment; and monitor select physical health conditions (e.g., diabetes and hypertension) in addition to behavioral health conditions. Practices are not required to offer co-located physical health services.
    • Care Management – Practices must provide ongoing, whole-person care management across an individual’s needs, including physical health, behavioral health, and HRSN. Care management must encompass use of an interprofessional care team that includes an individual’s physical and behavioral health providers in addition to other types of providers, such as community health workers or peer support specialists.
    • Health Equity – CMS will require practices to screen for and provide referrals to services addressing HRSN and report on these data. Practices must also implement a population health needs assessment and develop a health equity plan. HRSN screening is a consistent requirement across all recent CMMI models.
  • Foundational Supports: Recognizing that many behavioral health providers were ineligible to receive EHR adoption incentives under the HITECH Act, state Medicaid agencies can use IBH funding for targeted investments in health information technology (HIT) capacity, interoperability, and clinical decision support tools, including electronic health records, at participating practices. These efforts complement a broader $20 million investment by Substance Abuse and Mental Health Services Administration (SAMHSA) and the Office of the National Coordinator for Health Information Technology (ONC) to advance HIT in behavioral health practices over the next three years. IBH funding may also be used to fund telehealth infrastructure and population health management tools. Collectively, this strategic funding can support IBH practices in implementing new care models and facilitating the data exchange required to manage care across individuals’ physical and behavioral health needs. In addition to supporting technology, funding can be used for other types of capacity building at participating practices, including staffing and workforce development efforts and quality improvement. States will use a subset of their cooperative agreement funding to invest in infrastructure at practices that are only participating in IBH for their Medicaid population; practices participating for both their Medicaid and Medicare population will apply to CMS directly for infrastructure funding.

    As noted above, states will also leverage the cooperative agreement funding to build state Medicaid agency capacity to implement IBH. The funding can support development of HIT infrastructure at the state level, design of the Medicaid VBP methodology, and provision of technical assistance to behavioral health practices, among other purposes.
  • VBP Model: For Medicaid, states are required to develop a VBP methodology for services included in the care delivery framework (e.g., screenings, assessments, care management) provided to attributed Medicaid enrollees at IBH-participating practices. If relevant, states can adapt payment methodologies they are already using for other federally sponsored behavioral health reform initiatives, such as CCBHC or Health Homes (see additional detail below).

    For practices participating in IBH for Medicare, CMS has indicated that the payment methodology will include two components: (1) a prospective, risk-adjusted “integration support payment” to cover required components of the care delivery framework and (2) a performance-based payment. Notably, CMS projects that the integration support payment will be between $200 to $220 per member per month. Initially, the performance-based payments will be pay-for-reporting; participants will begin to transition to pay-for-performance payments in the fifth year of IBH. Practices will only be expected to assume upside risk. Quality measures will be aligned across Medicaid and Medicare.

Considerations for State Medicaid Agencies

IBH presents an exciting opportunity for states to accelerate their behavioral health transformation efforts in the midst of the current mental health and SUD crises. At the same time, when deciding whether to respond to the IBH NOFO, states will be focused on ensuring that IBH can complement and build upon, and not duplicate or conflict with, their efforts to date.

As states assess whether to apply to participate in IBH, considerations include:

  • Alignment of IBH with other state-driven behavioral health care delivery reforms. CMS recognizes that IBH shares similarities with other CMS and SAMHSA initiatives, including CCBHCs, Promoting Integration of Primary and Behavioral Health Care (PIPBHC), and Medicaid Health Homes. Accordingly, in its February 29 webinar, CMS noted that “state recipients can build off existing Medicaid and state-based initiatives to implement IBH.” For states without mature integrated care or care management models for Medicaid enrollees with significant behavioral health needs, IBH presents a significant catalyst to advance efforts in this area. States that have participated in the CCBHC demonstration or PIPHC or that have a Health Home program will be looking to align IBH with their existing integrated care models. While CMS has provided preliminary indication that IBH will be synergistic with these programs, it has not yet released additional details. States will be looking to understand the extent to which IBH will support their existing efforts versus requiring states and behavioral health practices to shift course.

    Additionally, many states offer home and community-based services (HCBS) such as supported employment and respite to Medicaid enrollees with significant behavioral needs under a Medicaid authority requiring conflict-free case management (e.g., 1915(c) waivers, 1915(i) State Plan amendments). When conflict-free requirements are in place, a single provider cannot conduct both case management and service delivery for the same individual2—a bifurcation that is antithetical to IBH’s emphasis on integrated care management at the site of care. States with robust HCBS benefits for populations with significant behavioral health needs will be interested in whether IBH provides flexibility on conflict-free case management requirements to permit practices to provide case management and HCBS to the same individual.
  • Sufficiency of foundational supports to meet market needs. Given the historical federal underinvestment in HIT at behavioral health providers, some behavioral health practices may need significant funding to build data exchange capabilities and conduct the population health management activities necessary to maximize their success in VBP arrangements. States will be assessing whether funding available under IBH is sufficient to recruit a diverse, critical mass of providers to participate in the model. States will likely evaluate how they can braid multiple funding sources to maximize the impact of IBH in addition to the probability that practices will also opt into the model for their Medicare populations, giving practices access to additional funding.
  • Opportunities to leverage existing VBP arrangements. States that have already invested heavily in instituting alternative payment models for behavioral health practices (e.g., the prospective payment system for CCBHC) will be interested in understanding the degree to which they will be able leverage their existing methodologies versus making significant changes that would be burdensome to both the state and practices.
  • Interest in Medicare-Medicaid alignment. Unlike CCBHC, PIPBHC, and Health Homes, IBH presents the opportunity for Medicare participation, which is likely to be enticing to states with a strong interest in promoting Medicare-Medicaid alignment. This may be especially true in rural states and others in which public payers predominate. At the same time, given that Medicare generally covers a substantially smaller array of behavioral health services as compared to Medicaid, practices may be more limited in their efforts to link Medicare enrollees to the behavioral health services that they need.

Next Steps

In Spring 2024, CMS will release a NOFO that will include further details on IBH and, importantly, the formal application for states interested in participating in the model. CMS intends to award cooperative agreements to as many as eight state Medicaid agencies in the second half of 2024, and the model is expected to launch a three-year planning period in of the last quarter of 2024. IBH will ultimately be implemented for five years, from the fourth quarter of 2027 to the third quarter of 2032.

Manatt has published other resources on CMMI’s TMaHGUIDE and MCP models for reference.

1 CMS has also indicated that the “State NOFO application period” will be in the second and third quarters of 2024.

2 42 CFR 441.301(c)(1)(vi); 42 CFR 441.730(b)(5)



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