Examples from three states illustrate the dimensions of the problem Medicaid-eligible persons with mental disorders endure while they wait for their Medicaid benefits to become available.

People discharged from hospitals or released from prisons in Maryland, many of them with serious mental illnesses, routinely go for weeks before they receive new or restored Medicaid benefits that will allow them to receive prescribed medications, emphasized psychiatrist Fred Osher, M.D., director of the University of Maryland’s Center for Behavioral Health, Justice, and Public Policy.

"During these [waiting] periods, there is no system in place for these patients to receive medication and psychiatric services. Consequently, many [relapse], ending up back in the correctional system," Osher said. The same serious treatment gap exists in Maryland for Medicaid-eligible patients discharged from acute-care and psychiatric hospitals.

"In Virginia this scenario is happening every day at hospitals, correctional facilities, and institutions," said Caitlin Wright, program director of the Virginia chapter of the National Alliance on Mental Illness (NAMI). Psychiatric patients in Virginia wait a minimum of 30 days before being approved for Medicaid.

During these 30 days, there is no system in place for local hospitals in Virginia to step in and provide benefits such as medication to those persons, explained Wright. She added that "to make matters worse, there is a Virginia ruling that does not allow social workers to apply for Medicaid [on behalf of] patients. And keep in mind that these are 12-page forms." In addition, community mental health centers usually require at least a one-month wait for an appointment to see a psychiatrist. Wright noted that she is sometimes forced to send patients waiting for Medicaid to local clinics for one-time prescriptions or the emergency room of a nearby hospital with a pharmacy.

In New York State, "the scenario of patients being discharged without Medicaid benefits and thus access to the requisite medications and community support services is a problem for consumers" in all regions, according to Susan Batkin, director of social work at the Urban Justice Center, which has developed a statewide coalition in New York to investigate the Medicaid gap.

Similarly, Diane Sonde said that for the 15 years that she has been the director of Goddard Riverside’s Project Reachout, a program that assists homeless mentally ill people on Manhattan’s Upper West Side, this has been a problem: "Patients are released from jails, hospitals, and institutions without active Medicaid coverage. Without medical coverage, they cannot afford medications," said Sonde, adding, "Patients stop taking their medications for a variety of reasons, and this is a key one."