SEC. 2. DEMONSTRATION PROJECT TO INCREASE SUB-
STANCE USE PROVIDER CAPACITY UNDER 
THE MEDICAID PROGRAM. 
Section 1903 of the Social Security Act (42 U.S.C. 
1396b) is amended by adding at the end the following new 
subsection: 
‘‘(aa) DEMONSTRATION PROJECT TO INCREASE SUB-
STANCE USE PROVIDER CAPACITY.— 
‘‘(1) IN
GENERAL.—Beginning January 1, 
2019, the Secretary shall conduct a 5-year dem-
onstration project under which the Secretary shall 
provide to an eligible State (as defined in paragraph 
(2)(A)) payments, in accordance with paragraph (3), 
with respect to expenditures by such eligible State 
for incentives, training, and technical assistance for 
providers under the State plan (or a waiver of such 
plan) to expand substance use treatment and recov-
ery services for individuals enrolled under such State 
plan (or waiver), including each of the following ac-
tivities: 
‘‘(A) Activities that support the develop-
ment of an assessment of the behavioral health 
treatment needs of the State to determine the 
extent to which providers are needed (including 
the types of such providers and geographic area 
of need) to improve the network of providers 
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that treat substance use disorders under the 
State plan (or waiver), including: 
‘‘(i) An estimate of the number of in-
dividuals enrolled under the State plan (or 
a waiver of such plan) who have a sub-
stance use disorder. 
‘‘(ii) Information on the capacity of 
providers to provide substance use disorder 
services to individuals enrolled under the 
State plan (or waiver), including informa-
tion on providers who provide such serv-
ices. 
‘‘(iii) Information on the gap in sub-
stance use disorder treatment under the 
State plan (or waiver) based on the infor-
mation described in clauses (i) and (ii). 
‘‘(iv) Projections regarding the extent 
to which participating under the dem-
onstration project would increase the num-
ber of providers offering substance use dis-
order services under the State plan (or 
waiver) during the period of the dem-
onstration project. 
‘‘(B) Activities that, taking into account 
the results of the assessment described in sub-
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paragraph (A), support the recruitment, train-
ing, and provision of technical assistance for 
current, new, and prospective participating pro-
viders under the State plan (or a waiver of such 
plan) that specialize in substance use disorder 
treatment and recovery. 
‘‘(C) Activities that specifically expand, in-
cluding through the provision of incentives, the 
number of providers participating under the 
State plan (or waiver) that— 
‘‘(i) are authorized to dispense drugs 
approved by the Food and Drug Adminis-
tration for individuals with a substance use 
disorder who need withdrawal management 
or maintenance treatment for such dis-
order; 
‘‘(ii) have in effect a registration or 
waiver under section 303(g) of the Con-
trolled Substances Act for purposes of dis-
pensing narcotic drugs to individuals for 
maintenance treatment or detoxification 
treatment and are in compliance with any 
regulation promulgated by the Assistant 
Secretary for Mental Health and Sub-
stance Use for purposes of carrying out 
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the requirements of such section 303(g); 
and 
‘‘(iii) are licensed or certified under 
applicable State law to provide substance 
use disorder treatment and recovery serv-
ices. 
‘‘(D) Activities that specifically expand, in-
cluding through the provision of incentives, the 
number of providers participating under the 
State plan (or waiver) that have the qualifica-
tions to address the treatment and recovery 
needs of— 
‘‘(i) individuals enrolled under the 
State plan (or a waiver of such plan) who 
have neonatal abstinence syndrome, in ac-
cordance with guidelines issued by the 
American Academy of Pediatrics and 
American College of Obstetricians and 
Gynecologists relating to maternal care 
and infant care with respect to neonatal 
abstinence syndrome; 
‘‘(ii) postpartum women and infants, 
particularly the concurrent treatment and 
comprehensive case management of post-
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partum women and infants, enrolled under 
the State plan (or a waiver of such plan); 
‘‘(iii) adolescents and young adults be-
tween the ages of 12 and 21 enrolled 
under the State plan (or a waiver of such 
plan); or 
‘‘(iv) American Indian and Alaska Na-
tive individuals enrolled under the State 
plan (or a waiver of such plan). 
‘‘(2) ELIGIBLE STATES.— 
‘‘(A) DEFINITION.—For purposes of this 
subsection, the term ‘eligible State’ means a 
State selected by the Secretary under subpara-
graph (B). 
‘‘(B) SELECTION.—For purposes of this 
subsection, the Secretary shall select 10 States 
that meet the criteria for eligibility under sub-
paragraph (C). In selecting such States, the 
Secretary shall— 
‘‘(i) select States in a manner that en-
sures geographic diversity; 
‘‘(ii) give preference to States with a 
prevalence of substance use disorders (in 
particular opioid use disorders) that is 
comparable to or higher than the national 
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average prevalence, as measured by aggre-
gate drug overdoses, or any other measure 
that the Secretary deems appropriate; and 
‘‘(iii) take into consideration the qual-
ity of applications submitted under sub-
paragraph (D). 
‘‘(C) CRITERIA FOR ELIGIBILITY.—To be 
eligible for selection under subparagraph (B), a 
State shall— 
‘‘(i) have a State plan (or waiver of 
the State plan) approved under this title; 
and 
‘‘(ii) submit to the Secretary an appli-
cation in accordance with the requirements 
in subparagraph (D). 
‘‘(D) APPLICATIONS.—For purposes of this 
paragraph, a State shall submit to the Sec-
retary, at such time and in such form and man-
ner as the Secretary requires, an application 
that includes such information, provisions, and 
assurances, as the Secretary may require, in ad-
dition to the following: 
‘‘(i) A proposed process for under-
taking the assessment described in para-
graph (1)(A). 
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‘‘(ii) A proposed process for reviewing 
reimbursement methodologies and other 
policies related to substance use disorder 
services under the State plan (or waiver) 
that may create barriers to increasing the 
number of providers delivering substance 
use disorder services. 
‘‘(iii) A proposed process for devel-
oping a plan that will result in long-term 
and sustainable provider networks under 
the State plan (or waiver) that will offer a 
continuum of care for substance use dis-
orders. Such plan shall include the fol-
lowing: 
‘‘(I) Specific activities to increase 
access to providers (including pro-
viders that specialize in providing sub-
stance use disorder services, hospitals, 
health care systems, and Federally 
qualified health centers) that offer 
substance use disorder treatment, re-
covery, and support services, including 
short-term detoxification services, out-
patient substance use disorder serv-
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ices, and evidence-based peer recovery 
services. 
‘‘(II) 
Strategies 
that 
will 
incentivize 
providers 
described 
in 
paragraph (1)(C) to obtain the nec-
essary training, education, and sup-
port to deliver substance use disorder 
services in the State. 
‘‘(III) Milestones and timeliness 
for implementing activities set forth in 
the plan. 
‘‘(IV) Specific measurable targets 
for increasing the substance use dis-
order provider network under the 
State plan (or a waiver of such plan). 
‘‘(iv) A proposed process for reporting 
the information required under paragraph 
(4)(A), including information demonstrat-
ing the progress of the efforts of the State 
to expand the capacity of providers to de-
liver substance use disorder services during 
the period of the demonstration project 
under this subsection. 
‘‘(v) A projected five-year budget for 
the State to carry out under the dem-
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onstration project under this subsection 
the activities set forth in the plan. 
‘‘(3) PAYMENT.— 
‘‘(A) IN GENERAL.—For each quarter oc-
curring during the period for which the dem-
onstration project is conducted, the Secretary 
shall pay under this subsection, subject to sub-
paragraph (B), to each eligible State an amount 
equal to 90 percent of so much of the sums ex-
pended during such quarter as are attributable 
to activities described in paragraph (1). 
‘‘(B) NON-DUPLICATION OF PAYMENT.—In 
the case that payment is made under subpara-
graph (A) with respect to expenditures for ac-
tivities carried out by an eligible State under 
the demonstration project under this sub-
section, payment may not also be made under 
subsection (a) with respect to expenditures for 
the same activities carried out by the eligible 
State. 
‘‘(4) REPORTS.— 
‘‘(A) STATE REPORTS.—A State receiving 
payments under this subsection shall, for the 
period of the demonstration project under this 
subsection, submit to the Secretary a quarterly 
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report, with respect to expenditures for activi-
ties for which payment is made to the State 
under this subsection, on the following: 
‘‘(i) The specific activities with re-
spect to which payment under this sub-
section was provided. 
‘‘(ii) The number of providers that de-
livered substance use disorder services in 
the State under the demonstration project 
compared to the estimated number of pro-
viders that would have otherwise delivered 
such services in the absence of such dem-
onstration project. 
‘‘(iii) The number of individuals en-
rolled under the State plan (or a waiver of 
such plan) who received substance use dis-
order services under the demonstration 
project compared to the estimated number 
of such individuals who would have other-
wise received such services in the absence 
of such demonstration project. 
‘‘(iv) Other matters as determined by 
the Secretary. 
‘‘(B) CMS REPORTS.— 
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‘‘(i) INTERIM
REPORT.—Not later 
than October 1, 2022, the Administrator 
of the Centers for Medicare & Medicaid 
Services shall submit to Congress an in-
terim report on activities carried out under 
the demonstration project under this sub-
section. 
‘‘(ii) FINAL REPORT.—Not later than 
October 1, 2024, the Administrator of the 
Centers for Medicare & Medicaid Services 
shall submit to Congress a final report on 
activities carried out under the demonstra-
tion project under this subsection.’’. 
Æ 
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