In the ever-changing landscape of healthcare, substance use disorder (SUD) treatment has evolved significantly over the past few decades. From the early days of inpatient care to the rise of outpatient and ambulatory treatment models, the industry has continually adapted to better meet the needs of individuals struggling with addiction. As payers increasingly prefer ambulatory, outpatient care due to its lower costs, providers like Gateway Foundation are working diligently to ensure they can offer the right treatment to the right patient—while also overcoming barriers like increased pre-admission requirements and payer constraints.
The Rise of Ambulatory and Outpatient SUD Treatment
Payers, especially insurance companies and managed care organizations, often have a preference for outpatient or ambulatory treatment options when addressing SUD cases. The rationale is simple: outpatient care tends to be far less expensive than inpatient treatment. For payers, this means significant cost savings, especially in an era where managing healthcare costs is more crucial than ever.
However, while ambulatory care may be more cost-effective, it doesn’t always align with the needs of every patient. Individuals with higher acuity cases—those who have co-occurring mental health disorders or severe substance use problems—may require more intensive care. Outpatient services, while effective for many, may not provide the level of support needed for these individuals.
At Gateway Foundation, a nonprofit providing comprehensive SUD and mental health treatment across nine states, the clinical reality is that the need for both outpatient and inpatient treatment programs is continuing to grow. The foundation treats more than 30,000 patients annually, offering services ranging from outpatient clinics to residential, bedded programs designed to cater to more severe cases.
As Jeremy Klemanski, President and CEO of Gateway Foundation, explains, “We know that the need [for both ambulatory and bedded programs] is unmet. We’re making targeted investments in both areas.” For Gateway Foundation, this balance between outpatient and bedded programs is key to their treatment philosophy. While ambulatory programs are crucial for many patients, they recognize the growing demand for more intensive, inpatient options for those with complex, high-acuity needs.
Why Gateway Foundation Continues to Invest in Bedded Programs
While payers often favor ambulatory care for its lower cost, Gateway Foundation is not backing away from investing in bedded programs. This decision is largely informed by the rising acuity of patients who seek treatment. Across the nation, more individuals are presenting with not only substance use disorders but also co-occurring mental health conditions such as anxiety, depression, and PTSD. These dual diagnoses require more specialized, intensive care that outpatient treatment simply cannot provide.
“The question one might ask is, ‘Why are we pushing higher acuity folks to the less acute service model?’” Klemanski states. As providers across the country witness the increasing severity of cases, the need for bedded programs becomes even more apparent. “We are seeing people who have a higher acuity of both substance use and mental health conditions combined. Those are not folks who are, frankly, easy to treat,” he adds.
For these higher-acuity patients, who often require extended care and close monitoring, inpatient treatment provides a structured environment that supports their recovery journey. Gateway Foundation’s bedded programs cater to these patients, providing the necessary treatment and care that more basic outpatient services cannot offer. This includes both detoxification services and ongoing treatment that helps address the underlying causes of addiction, such as trauma or mental health disorders.
The Growing Pressure from Payers
While Gateway Foundation remains committed to providing a spectrum of care, including bedded services for high-acuity patients, it is not immune to the increasing pressure from payers. Insurance companies and managed care entities often demand a focus on outpatient care due to its lower cost. Additionally, many payers are instituting more stringent pre-admission requirements, such as pre-authorization or additional screenings, to further control costs.
Klemanski reveals that Gateway Foundation has experienced an uptick in pre-admission requirements in certain states. These requirements can act as barriers to treatment access, potentially delaying or preventing patients from receiving the care they need. In some cases, these increased requirements may even violate parity laws, which mandate that insurance providers offer equal coverage for mental health and substance use disorder treatment as they do for physical health conditions.
“Where those [requirements] are not legal or not in line with parity requirements, we’ve pushed back pretty hard,” Klemanski asserts. He emphasizes that when pre-admission requirements become obstacles, they jeopardize the timely access to care that patients urgently need, especially in the critical window when someone is ready to seek help. Delays can lead to treatment drop-offs, with patients abandoning their recovery journey out of frustration or discouragement.
Despite these challenges, Gateway Foundation has been able to work through many of these obstacles by approaching payers with a partnership mindset. “We try to start with the partnership approach and say, ‘Listen, you can’t do this in this state. Why don’t you talk to us? What are you trying to accomplish?’” Klemanski explains.
Parity Laws and the Need for Better Advocacy
Gateway Foundation’s pushback against illegal pre-admission requirements highlights an ongoing issue in the SUD treatment landscape: parity in mental health and substance use disorder treatment. In theory, parity laws are designed to ensure that insurance coverage for mental health and SUD treatment is comparable to coverage for physical health conditions. However, in practice, these laws are not always upheld.
The increased pre-admission requirements introduced by some payers are often at odds with these parity laws, leading to situations where individuals in need of critical care may face unnecessary hurdles before receiving treatment. Advocating for stronger enforcement of parity laws is essential to ensuring that individuals struggling with substance use disorders and mental health conditions are not unfairly discriminated against when accessing care.
Klemanski points to the growing national push to collect long-term treatment data as a potential avenue to demonstrate the effectiveness of bedded treatment options. “The more we can validate for payers that longer lengths of stay in a bedded setting correlate to increased recovery capital, increased health, and increased time to work on social determinants of health, post-acute stay, the more comfortable people can be spending their dollars on that type of care,” he suggests. This data could help persuade payers to invest in more comprehensive, inpatient treatment options for high-acuity patients, demonstrating that the higher upfront costs can lead to better long-term outcomes.
Gateway’s Approach to Growth and Workforce Development
As Gateway Foundation continues to expand its operations—opening new clinics in places like Peoria, Illinois, and investing in new treatment modalities—the organization is also prioritizing workforce development. The SUD treatment sector, like many healthcare fields, is facing significant workforce challenges, including staff shortages and high turnover rates.
In response, Gateway Foundation has implemented a variety of strategies aimed at retaining its workforce. These include doubling the funding for continuing education, covering recertification fees, and launching an advanced education program for staff members. By supporting the professional development of its employees, Gateway Foundation is not only investing in the quality of care but also in the long-term success and stability of the organization.
Looking Ahead: Addressing the National SUD Crisis
Looking forward to the remainder of 2024 and into 2025, Klemanski anticipates ongoing challenges in addressing the substance use disorder crisis. The proliferation of fentanyl and other opioids continues to fuel overdose rates, putting additional strain on treatment providers and healthcare systems across the nation. Moreover, the political landscape—particularly the presidential election cycle—may result in increased pressure for policy changes and greater funding for addiction treatment programs.
“I think we can look forward to the competitive pressure that a presidential election brings to an incumbent administration and a potential new administration and hope that it creates some movement or some increased awareness around just how bad that picture is in a lot of communities,” Klemanski says.
For Gateway Foundation, the key to navigating these challenges will be to maintain its commitment to providing high-quality care while also advocating for the changes needed to improve access to services. This includes addressing the ongoing workforce crisis and ensuring that parity laws are enforced, all while continuing to expand its reach to meet the growing demand for substance use disorder treatment.
Conclusion: A Balanced Approach to SUD Treatment
As the landscape of substance use disorder treatment continues to evolve, it’s clear that there is no one-size-fits-all solution. While payers may favor outpatient care due to its lower costs, the clinical reality is that many patients require more intensive, inpatient services to address the complexity of their conditions. For organizations like Gateway Foundation, the key to success lies in offering a comprehensive array of services, from ambulatory treatment to bedded programs, while also navigating the complexities of payer requirements and advocating for policies that ensure equitable access to care. By balancing the needs of patients with the realities of the healthcare market, Gateway is poised to continue making a positive impact in the fight against substance use disorders.
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