The first Trump administration created a waiver that allows states to exempt themselves from the 16-bed limit for Medicaid mental health reimbursement.
Posted by On with Kara Swisher, Checked
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On with Kara SwisherAug 10, 2026
Sources show the first Trump administration announced in November 2018 a Medicaid waiver opportunity letting states seek federal reimbursement for short-term inpatient mental health treatment in facilities with more than 16 beds, despite the IMD exclusion. The claim's wording is a looser paraphrase, and the waiver requires states to apply and meet budget-neutrality conditions, but the core assertion holds.
What was said
… It's very specific. It's a 16 bed limit. Now, that inevitably means that the money doesn't go very far because, you know, imagine if hospitals couldn't be more than 16 beds. It'd be crazy. That's what happened with mental health. And so, the first Trump administration created a waiver states can exempt themselves from. This That's a very practical thing you could we haven't done that in California a practical way of getting more money into the system. I don't think it really is intractable. I think you just need a sort of, you know, practical approach where you work through these problems. …
On with Kara Swisher · · from the transcriptPost →What we found
Supports. CNN reports that CMS, announced by HHS Secretary Alex Azar in November 2018, detailed a new Medicaid waiver opportunity through which states may bypass the 16-bed reimbursement restriction on inpatient psychiatric treatment.[3]
Supports. AJMC reports that HHS Secretary Azar said CMS was giving states more flexibility to enact inpatient mental health treatment for Medicaid beneficiaries, reversing the IMD exclusion's bar on payment in facilities with more than 16 beds.[4]
Supports. The American Action Forum confirms the Trump Administration announced it would offer state Medicaid programs waivers to the IMD exclusion to expand access to mental health treatment, and notes approval of 17 state waivers.[5]
Supports. AP reports that the Trump administration opened the way for state waivers from the 16-bed IMD exclusion in 2017 for substance abuse treatment and was then weighing similar mental health waivers, which the Congress.gov CRS report on the IMD exclusion's 16-bed limit corroborates as background.[1][2]
Context. States must guarantee the waiver is budget-neutral to the federal government and must not come at the expense of community-based mental health care, so the waiver is conditional rather than an automatic exemption.[3]
Sources
5 sources: 1 fact-checker, 1 primary, 1 tier 2, 2 not rated
- 1Trump administration weighs mental health coverage optionapnews.com · fact-checker · cited for: supports
- 2states rather than the federal government - Congress.govcongress.gov · primary source · cited for: supports
- 3States may now broaden mental health treatment under ...cnn.com · tier 2 · cited for: supports, context
- 4HHS Lifting IMD Exclusion for Medicaid Payment for Inpatient Mental ...ajmc.com · not rated · cited for: supports
- 5Tackling the IMD Exclusion - AAF - The American Action Forumamericanactionforum.org · not rated · cited for: supports
Where this claim was made
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