SE Minnesota News

Rep. Brad Finstad, who represents Minnesota’s 1st district in the U.S. Congress, has introduced new legislation aimed at expanding access to inpatient mental health care. The bill, titled the Restoring Inpatient Mental Health Access Act of 2025, seeks to remove a longstanding federal restriction that limits Medicaid funding for mental health institutions with more than 16 beds.

Currently, under Title XIX of the Social Security Act, Medicaid cannot use federal funds to pay for care in certain mental health facilities if they primarily treat people with mental illness and have more than 16 beds. This policy is known as the “IMD exclusion.” It was established decades ago to encourage states to provide treatment in community settings rather than large institutions. However, critics argue that this has limited access to necessary inpatient care.

If enacted, Finstad’s bill would eliminate the IMD exclusion and allow federal Medicaid dollars to help cover costs for individuals receiving inpatient treatment in larger mental health hospitals or residential facilities.

Olmsted County Commissioner David Senjem commented on the proposed legislation: “Thank you Representative Finstad for advancing this extremely important legislative initiative aimed at helping individuals seriously afflicted with mental illness. We know from decades of experience that outpatient, community-based, treatment is not sufficient for every individual in every circumstance leading too often to a life of hopelessness, despair, and homelessness. Lifting the IMD exclusion will give many individuals across Minnesota and America the necessary inpatient treatment needed for a new lease on life and brighter days ahead.”

The proposed act aims to increase access to inpatient care for those experiencing a crisis requiring hospitalization. It would also ease financial pressures on states and hospitals by allowing Medicaid cost-sharing for these services and reduce strain on emergency rooms and jails that currently house people unable to receive appropriate inpatient mental health treatment.

Finstad has served in Congress since 2022 after replacing Jim Hagedorn as representative of Minnesota’s 1st district. He previously served in the Minnesota House of Representatives from 2003 to 2009 and holds a BS degree from the University of Minnesota. Born in New Ulm in 1976, he continues to reside there.

The IMD exclusion currently prevents federal Medicaid funding for services delivered in certain institutions for adults aged 21 through 64 but allows funding if care is provided outside such facilities or within smaller ones not primarily engaged in treating people with mental diseases.