Following is National Alliance on Mental Illness (NAMI) Policy on Institutions for Mental Diseases Exclusion in Medicaid law

(5.4.8) Institutions for Mental Diseases (IMDs)
( The federal government currently denies Medicaid reimbursement for persons otherwise Medicaid eligible who are over 21 and under 65 years of age if such persons reside in facilities designated as “Institutions for Mental Diseases” (IMDs). State hospitals, nursing homes, and residential facilities of 16 or more beds may be classified as IMDs if they provide specialized “mental illness” services, have over 50 percent of their patients diagnosed as “mentally ill,” or meet certain other criteria.
( NAMI believes that the application of the IMD rule most dramatically affects persons suffering from schizophrenia and other brain disorders because these individuals tend to fall within the impacted age group and thereby are denied Federal Financial Participation (FFP) in their treatment solely on the basis of where they happen to reside, assuming they would meet all other Medicaid eligibility requirements.
( The IMD rule is thus discriminatory and works against the provision of necessary health care for young and middle-aged adults with brain disorders.
( NAMI calls upon the United States Congress to repeal the IMD rule and to adopt uniform standards of Medicaid eligibility based upon individual resources and the need for services, rather than upon the location in which services are provided or the residence of the recipient.