North Macedonia: U.S. Government Has Provided Funding to Support Democracy Activities

Since fiscal year 1991, the United States has provided over a billion dollars in assistance to North Macedonia. In recent years, USAID and State have expressed concern about an erosion of democracy in the country. These concerns were heightened by the onset of a political crisis in February 2015, when the then-opposition party released phone conversations revealing alleged corruption in the ruling party. This crisis prompted the four major political parties to invite the United States and the European Union to help broker an agreement. The parties later agreed to hold early parliamentary elections in December 2016. Though the opposition party formed a majority coalition, the President refused to give the opposition leader a mandate to form a new government until May 2017, after protesters violently attacked North Macedonia's Parliament.

This report examines (1) U.S. government funding for democracy assistance in North Macedonia and (2) the extent to which USAID adhered to relevant policies in selecting recipients of democracy assistance in North Macedonia. GAO analyzed U.S. government data and documents and interviewed U.S. officials in Washington, D.C., and in Skopje, North Macedonia.

The U.S. government provided more than $45 million for democracy assistance in North Macedonia through the U.S. Agency for International Development (USAID), National Endowment for Democracy (NED), and U.S. Department of State (State) in fiscal years 2012 through 2017. During this 5 year period—the most recent for which funding data were available—USAID obligated about $38 million to support rule of law and human rights, governance, political competition and consensus building, civil society, and an independent media and free flow of information. NED—a nongovernmental organization funded largely through appropriated funds—provided $4.2 million for activities such as training in investigative reporting and rule of law. The U.S. embassy in Skopje obligated at least $3.7 million for rule of law and human rights, governance, and civil society. State's Bureau of International Narcotics and Law Enforcement Affairs (INL) and Bureau of Democracy, Human Rights, and Labor (DRL) also provided funding for democracy initiatives. However, GAO is unable to report State's total obligations, because INL's data were unreliable and because DRL, due to the regional nature of its projects, does not track country-level obligations for North Macedonia.

Legend: USAID = U.S. Agency for International Development, NED = National Endowment for Democracy, State = U.S. Department of State.

Note: Only obligations from the Public Affairs Section of the U.S. Embassy in Skopje are shown for State. State's other funding data were either unreliable or not tracked at the country level.

GAO's review of 13 USAID democracy assistance awards, representing roughly half of USAID obligations in fiscal years 2012 through 2017, found that the agency generally complied with operational policy intended to ensure a fair and transparent selection process. USAID policy requires officials to consider merit review criteria specified in public notices and to assess applicants against these criteria. GAO found that the merit review criteria USAID included in public notices were generally consistent with the criteria that selection committees used to evaluate applicants. GAO also found that selection committees generally discussed the relative strengths and weaknesses of award applications and recorded these discussions in selection memorandums, consistent with USAID policy.

In prior work, GAO recommended that State identify and address factors affecting the reliability of INL's democracy assistance data. State concurred and, in July 2019, reported that INL was continuing efforts to improve data reliability. GAO will continue to monitor State's efforts to ensure this recommendation is fully implemented.

The United States has provided more than $1 billion in assistance to  North Macedonia since that country declared its independence from  Yugoslavia in 1991. In recent years, the U.S. Agency for International  Development (USAID) and the Department of State (State) have  expressed concerns about an erosion of democracy in North Macedonia  after the agencies assessed that government control over the judiciary  and media was increasing. In February 2015, the leader of the opposition  party began releasing wiretapped phone conversations that allegedly  revealed corruption on the part of leaders of North Macedonia’s ruling  party, triggering a political crisis.

The crisis prompted the country’s four main political parties to invite the  United States and the European Union (EU) to facilitate negotiations to  broker an agreement, known as the Przino Agreement, which the major  political parties signed on June 2, 2015. U.S. and EU officials continued  to engage North Macedonia’s political parties to implement the  agreement, which culminated in early parliamentary elections in  December 2016. Although the leader of the then-opposition party formed  a majority coalition in February 2017, the President of North Macedonia,  Gjorge Ivanov, refused to give the party’s leader the mandate to form a  new government until May 2017, following a violent attack by protesters  on the country’s Parliament. North Macedonia’s political parties formed a  new government in May 2017. Before and throughout the crisis, USAID,  State, and the National Endowment for Democracy (NED)—a  nongovernmental, nonprofit organization funded largely through  appropriated funds—provided democracy assistance to organizations in  North Macedonia to fund a range of activities, including assistance to  strengthen the political parties, monitor elections, and support an  independent media.

You asked us to examine U.S. democracy assistance in North Macedonia  and U.S. government actions during North Macedonia’s political crisis.  This report examines (1) U.S. funding for democracy assistance in North  Macedonia during fiscal years 2012 through 2017, the most recent 5-year  period for which these data were available, and (2) the extent to which  USAID adhered to relevant policies in selecting recipients of democracy  assistance in North Macedonia. We will issue a separate, classified report  on political events in North Macedonia from January 2012 through June  2017 and the U.S. government’s actions in North Macedonia during that  period.

To address these objectives, we reviewed documents and data on  democracy assistance awards provided by USAID, State, and NED,  including planning and strategy documents.  We analyzed documents and  data for a sample of USAID’s awards between fiscal years 2012 through  2017. To determine the data’s reliability, we interviewed cognizant  officials and reviewed relevant documentation. We also interviewed  USAID, State, and NED officials in North Macedonia as well as  representatives of implementing partners and of the government of North  Macedonia in Skopje, North Macedonia. In addition, we interviewed  USAID, State, and NED officials, and implementing partner  representatives, in Washington, D.C. For further information about our  scope and methodology, see appendix I.

We conducted this performance audit from May 2017 to October 2019 in  accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives.

The United States has maintained a cooperative relationship with North  Macedonia across a broad range of political, economic, cultural, military,  and social issues since North Macedonia gained its independence from  Yugoslavia in 1991. The United States formally recognized North  Macedonia in 1994, and the countries established full diplomatic relations  in 1995. Following a civil conflict between the country’s ethnic Albanian  minority and the Macedonian majority in 2001, the United States and the  EU mediated a resolution and supported efforts to agree to a peaceful,  political solution to the crisis, known as the Ohrid Framework Agreement.  Figure 1 shows Macedonia’s location in southeastern Europe. corridor from Western and Central Europe to  the Aegean Sea

2,118,945 (146th largest in the world, 2018 $31.03 billion gross domestic product in 2017

22.4 percent unemployment rate (2017 est.)

Macedonian, 64.2 percent; Albanian, 25.2  percent; Turkish, 3.9 percent; Romani, 2.7  percent; Serb, 1.8 percent; other, 2.2 percent  (2002 est.)

In 2011, USAID and State assessed that North Macedonia’s conservative  party, the Internal Macedonian Revolutionary Organization–Democratic  Party for Macedonian National Unity (known as VMRO-DPMNE, or  VMRO) was consolidating political power when it became the ruling party  in 2006. USAID and State found that government control over North  Macedonia’s judiciary, Parliament, media, civil society, and local  government was increasing.

In December 2012, security personnel ejected members of the Social  Democratic Union of Macedonia (SDSM), the main opposition party, from  the Parliament building, along with journalists who had been observing  the session, after SDSM members protested VMRO’s proposed budget.  SDSM boycotted Parliament for approximately 2 months after this  incident but returned in March 2013, when the parties reached an  agreement. In May 2014, SDSM boycotted Parliament again, accusing  VMRO of having violated the country’s electoral code in April 2014  elections, in which VMRO retained its parliamentary majority.

In December 2014, USAID concluded that inadequate mechanisms for  competition and political accountability represented the primary  democracy and governance problems in North Macedonia. USAID noted,  among other things, that the ruling party had deployed public resources  and control of the media to limit competition; captured executive,  legislative, and judicial institutions; and put pressure on, and excluded,  civil society.

In February 2015, the leader of SDSM began releasing phone  conversations allegedly recorded by the government’s counterintelligence  service that revealed widespread corruption and state capture by the  ruling party, VMRO, triggering a political crisis. (See fig. 2 for a timeline  of the crisis.) Street protests followed these leaks. The four main political  parties invited the United States and EU to facilitate negotiations to  broker a peaceful resolution to the crisis, known as the Przino Agreement,  in June 2015. The parties agreed to, among other things, hold free and  fair elections by the end of April 2016.

After two failed attempts to hold elections in early 2016, the United States  and EU convened North Macedonia’s political parties for another round of  negotiations in the summer of 2016. The parties reached agreement on a  number of key reforms and set the conditions for parliamentary elections  by the end of 2016. These elections took place on December 11, 2016,  without a clear majority winner. Although SDSM leader Zoran Zaev  formed a majority coalition in February 2017, then-President Ivanov  refused to give Zaev the mandate to form a new government until May  2017, following a violent storming of Parliament by hundreds of protesters  in April. In May 2017, President Ivanov authorized SDSM to form a  government with a coalition of ethnic Albanian parties.

The new coalition government expressed support for North Macedonia’s  accession to the EU and membership in the North Atlantic Treaty  Organization (NATO). On February 12, 2019, the Republic of Macedonia  formally changed its name to the Republic of North Macedonia, ending a  longstanding dispute over its name with Greece, which had for years  exercised its veto power in NATO to block North Macedonia’s  membership (see the text box for details of North Macedonia’s NATO  aspirations and name dispute with Greece). On February 6, 2019, NATO  members signed an accession protocol with North Macedonia, paving the  way for North Macedonia to become the 30th member of NATO. The EU  states also opened the path to potential EU accession negotiations with  North Macedonia in June 2019, contingent on the country’s full  implementation of its agreement with Greece and its demonstrated  progress in implementing EU-recommended reforms. However, the EU  postponed the decision until no later than October 2019. On February 15,  2019, the U.S. government recognized North Macedonia’s name change.

North Macedonia’s NATO Aspirations and Name Dispute with Greece  In 2008, having determined that North Macedonia met North Atlantic Treaty Organization (NATO)  membership criteria, NATO allies decided that North Macedonia would be invited to join NATO as  soon as North Macedonia and Greece, a NATO member, resolved a dispute regarding North  Macedonia’s name. A brief timeline of this dispute follows.  1991: The “Republic of Macedonia” declared its independence from the former Yugoslavia.  Greece objected to this name, viewing “Macedonia” as representing territorial claims against  Greece, which has a northern province by the same name. Because Greece has veto power  in NATO, it was able to prevent the Republic of Macedonia from joining the organization.  1995: Greece and the Republic of Macedonia reached an interim accord in which Greece  agreed not to block applications by the Republic of Macedonia to international organizations if  made under the name “Former Yugoslav Republic of Macedonia.”  2008: At a NATO Summit in Bucharest, Greece blocked the Republic of Macedonia’s bid to  join NATO.   Dec. 2011: The International Court of Justice ruled that Greece had been wrong to block the  Republic of Macedonia’s bid to enter NATO in 2008, but the decision did not affect NATO’s  consensus-based decision-making process.  June 12, 2018: The foreign ministers of Greece and the Republic of Macedonia signed the  Prespa agreement, whereby the Republic of Macedonia would change its name to the  Republic of North Macedonia, Greece would no longer object to North Macedonia’s Euro- Atlantic integration, and both countries would promise to respect existing borders.  Sept. 30, 2018: The Republic of Macedonia held a referendum on changing its name to the  Republic of North Macedonia, with nearly 92 percent of votes in favor of the change. Overall  turnout for the referendum was about 37 percent, as opponents of the name change  boycotted the referendum.   Oct. 19, 2018: A two-thirds majority in North Macedonia’s Parliament voted in favor of the  name change.  Jan. 11, 2019: North Macedonia’s Parliament approved a constitutional amendment that  renamed the country to the Republic of North Macedonia.  Jan. 25, 2019: The Greek Parliament voted to approve the deal outlined in the Prespa  agreement.  Feb. 6, 2019: NATO’s 29 members signed an accession protocol with North Macedonia,  paving the way for the country to become the 30th member of the alliance.

Feb. 8, 2019: Greece became the first NATO member to ratify the accession protocol.  Feb. 12, 2019: The Republic of Macedonia formally changed its name to the Republic of  North Macedonia.

Feb. 15, 2019: The U.S. government recognized the Prespa Agreement’s entry into force and  North Macedonia’s name change.

According to State, democracy assistance seeks to advance freedom and  dignity by assisting governments and citizens to establish, consolidate,  and protect democratic institutions, processes, and values. These  components include participatory and accountable governance, rule of  law, authentic political competition, civil society, human rights, and the  free flow of information. Democracy assistance falls into six program  areas—Rule of Law, Good Governance, Political Competition and  Consensus-Building, Civil Society, Independent Media and Free Flow of  Information, and Human Rights—each with different program elements.  See appendix V for descriptions of democracy program areas and  program elements.

The U.S. government provides democracy assistance through multiple  bureaus and offices in USAID, State, and NED. For a list of these  agencies’ roles and responsibilities related to democracy assistance  overseas, see table 1.

Agency Operational Policies for Assistance

Federal laws governing agencies’ use of contracts and grants seek to  promote discipline in the selection and use of procurement contracts,  grant agreements, and cooperative agreements; maximize competition in  making procurement contracts; and encourage competition in making  grants and cooperative agreements. USAID’s operational policy, the  Automated Directives System, incorporates these requirements into  agency guidance. Thus, in selecting recipients of democracy assistance,  agency staff are required to guarantee the integrity of the competitive  award process by ensuring overall fairness and considering all eligible  applications for an award.

Strategic Objectives for Democracy Assistance in North Macedonia

Since North Macedonia’s separation from Yugoslavia in 1991, the United  States has provided democracy assistance to support North Macedonia’s  Euro-Atlantic integration and the development of prosperous and  democratic institutions. This assistance has focused on promoting rule of  law, political processes, citizen engagement, and free media. In light of  North Macedonia’s 2015 political crisis, as well as democratic backsliding  observed in the years before the crisis, USAID narrowed its assistance  goals for the country to focus on more inclusive citizen engagement in  civic life, political processes, and the free flow of information to support  better functioning checks on executive authority.

The USAID mission in North Macedonia’s strategic plan for 2011 through  2015 identified three primary objectives of U.S. democracy assistance in  North Macedonia:

Promote greater checks and balances in democratic processes by  empowering local governments, promoting greater equilibrium among  the branches of government at the national level, and promoting  political accountability.

Develop a basic education system that prepares youth for a modern  economy and stable democracy by improving students’ basic skills,  expanding workforce skills, and enhancing ethnic integration in the  education sector.

Increase job-creating private-sector growth in targeted sectors by  improving the country’s business environment in critical areas and  strengthening key private-sector capacities.

Additionally, USAID and State relied on a broader strategic framework,  the integrated country strategy, when developing democracy projects in  North Macedonia. This interagency, multiyear, overarching strategy  outlines U.S. policy priorities and objectives for North Macedonia. Its  objectives include improving North Macedonia’s democratic and civil  society environment to improve the country’s prospects for joining NATO  and for completing accession negotiations with the EU.

U.S. Agencies Obligated More Than $45 Million for Assistance for North Macedonia, but Total State Department Obligations Cannot Be Reliably Reported

U.S. government agencies obligated more than $45 million in democracy  assistance funding for North Macedonia in fiscal years 2012 through  2017, according to agency award documents and data (see table 2).  This assistance was provided to support U.S. strategic objectives for  North Macedonia, including promoting the rule of law, political processes,  citizen engagement, and free media. USAID obligated approximately $38  million, and NED obligated approximately $4.2 million. Additionally, the  Public Affairs Section of the U.S. Embassy in Skopje provided about $3.7  million in assistance. However, we are unable to report total State  obligations for democracy assistance for North Macedonia because of  uncertainty about the reliability of award data from State’s Bureau of  International Narcotics and Law Enforcement Affairs (INL). In addition,  State’s Bureau of Democracy, Human Rights, and Labor (DRL) provided  democracy assistance in North Macedonia solely through regional grants  and did not specify which obligated funds were provided for democracy  assistance in North Macedonia. See appendixes II through IV for a full list  of USAID, NED, and State awards for democracy assistance in North  Macedonia in fiscal years 2012 through 2017.

USAID Obligated Approximately $38 Million for Democracy Assistance Program Areas

USAID provided about $38 million in democracy assistance for North  Macedonia in fiscal years 2012 through 2017. As table 3 shows, the  majority of USAID funding—approximately $17 million—supported  projects in the civil society program area, while more than $7 million  supported political competition and consensus building.

Several USAID bureaus and offices provided democracy assistance in  North Macedonia during that period. The Bureau for Democracy, Conflict,  and Humanitarian Assistance and the Bureau for Europe and Eurasia  provided such assistance through contracts, grants, and cooperative  agreements. According to agency documents, USAID supported U.S.  foreign policy in North Macedonia by promoting democracy and respect  for the rule of law and human rights, through activities such as supporting  civil society organizations and developing the capacity of independent  media outlets in the country. USAID also promoted political competition  and accountability by working with political parties and state institutions to  enable an environment for free and fair elections.

In addition, USAID’s Office of Transition Initiatives (OTI) provided short- term assistance to groups in the country. OTI established an office in  North Macedonia in September 2015 to support reform processes  outlined in the Przino Agreement. According to OTI documents, OTI  supports U.S. foreign policy objectives by promoting stability, peace, and  democracy through fast, flexible, short-term assistance targeted to key  political transition and stabilization needs. The office works with civil  society organizations, media groups, and government institutions to  increase access to reliable information, promote free and open civic  discourse, and support democratic reforms. In North Macedonia, OTI  funded initiatives such as a televised debate series that presented civil  dialogue and diverse viewpoints on issues affecting citizens of North  Macedonia. OTI grants have also supported digital media initiatives and  civic engagement projects.

USAID assistance supported initiatives in a range of democracy program  areas. Table 4 shows examples of USAID projects across different  program areas, some of which are related to democracy assistance.

NED Obligated Approximately $4.2 Million for Democracy Assistance Activities

NED awarded 72 grants totaling nearly $4.2 million in North Macedonia in  fiscal years 2012 through 2017. Of these, six grants, totaling almost $1.7  million, were awarded to two of NED’s core institutes—the National  Democratic Institute and the Center for International Private Enterprise— while 66 grants, totaling about $2.6 million, were awarded to other  organizations. In addition, NED awarded 61 grants totaling more than  $17.1 million for regional programs that included North Macedonia. NED  does not disaggregate cost data by individual country due to the nature of  the Balkan regional programs NED supports. Thus, we are unable to  report the amounts NED provided in North Macedonia through regional  programs during the period of our review.

After the onset of the political crisis in 2015, NED focused its democracy  assistance in North Macedonia on three program areas: promoting good  governance, supporting independent media, and fostering positive  interethnic relations. NED grants supported a range of initiatives,  including projects to improve investigative reporting on democratic  reforms and rule-of-law matters, and to encourage youth leadership and  activism.

NED’s funding to the National Democratic Institute and the Center for  International Private Enterprise supported a range of activities in North  Macedonia. The institute worked with the country’s Parliament to improve  its management and organization of the legislative process by, among  other things, assisting Parliament in reviewing its legislative and oversight  procedures. Other National Democratic Institute initiatives included  encouraging participation by various groups in the democratic process,  including the Roma population, women, and civil society organizations.  The Center for International Private Enterprise received funding for one  grant devoted to developing youth leadership.

State Obligated At Least $3.7 Million for Democracy Assistance, but Some Project-Level Funding Could Not Be Determined

Several State offices—U.S. Embassy Skopje, INL, and DRL—provided  funding for democracy assistance in North Macedonia, but only the  funding provided by the embassy can be reliably reported. The embassy’s  Public Affairs Section provided at least $3.7 million in democracy  assistance in North Macedonia in fiscal years 2012 through 2017. INL  was unable to provide reliable data on obligations on its awards in North  Macedonia. DRL obligated more than $2 million to support democracy  assistance activities at the regional level but due to the regional nature of  its projects, was unable to provide country-level breakdowns of  obligations.

U.S. Embassy Skopje Provided Democracy Assistance Grants to Organizations in North Macedonia

In fiscal years 2012 through 2017, Embassy Skopje’s Public Affairs  Section obligated approximately $3.7 million in democracy assistance  grants to organizations in North Macedonia. According to State officials,  the embassy works with the Coordinator of U.S. Assistance for Europe  and Eurasia to allocate democracy assistance and helps align assistance  activities with the U.S. strategic goals for North Macedonia. The  embassy’s Public Affairs Section also provides democracy assistance  through other means, including media training programs, youth  engagement projects, speaker programs, and the Democracy  Commission Small Grants Program.

The embassy granted $1.8 million for 91 grants through the Democracy  Commission Small Grants Program in fiscal years 2012 through 2017.  According to the embassy, grants through this program, which cannot  exceed $24,000, support nongovernmental organizations’ efforts to  promote the rule of law, independent media, interethnic community  building, the empowerment of women and youth, human rights, and the  institutionalization of open and pluralistic democratic political processes.  Examples of awards for Democracy Commission grant–funded activities  include the following:

Women’s Rights Center ($22,900). This award funded a program to  strengthen the capacities of organizations that are working with  women victims of domestic violence.

Civil Lyceum Project ($17,830). This project aimed to mobilize youth  in Skopje to become more involved in the civil society sector and to  help create young leaders who understand the value of civic  engagement and advance democratic values.

Way Out ($7,858). This award funded the maintenance and  development of the online version of a student magazine.

The remainder of the embassy’s Public Affairs Section awards for  assistance in North Macedonia supported activities such as youth  engagement projects, speakers, and media training programs, which  included short-term trips for journalists from North Macedonia to receive  training in the United States.

INL Project-Level Funding Data Are Unreliable, but INL Reported Bulk Obligations for Democracy Assistance in North Macedonia

INL provided democracy assistance to organizations in North Macedonia  in fiscal years 2012 through 2017. INL was unable to provide reliable data  on project-level obligations; however, it reported bulk obligations for  democracy assistance projects that supported efforts to reform North  Macedonia’s criminal justice system to meet rule-of-law benchmarks for  Euro-Atlantic integration. INL’s assistance in North Macedonia focused  on three primary areas: developing the country’s criminal justice system,  developing legal professionals’ skills, and professionalizing the police.  According to agency officials, this assistance is intended to strengthen  North Macedonia’s justice sector and independent institutions. Specific  INL activities included assisting with revisions to the criminal procedure  code to promote a more adversarial justice system, providing technical  advisors and equipment to the Special Prosecutor’s Office, and promoting  accountable policing efforts by providing training to local police on crime  scene management.

In December 2017, we reported that INL funding data for democracy  assistance projects were unreliable and we recommended that State  identify and address factors that affect the reliability of its democracy  assistance data. State concurred with this recommendation. As of July  2019, INL reported continued efforts to improve data quality and  reliability, including ensuring that current and future transactions would  maintain coding integrity. However, officials stated that, because of  missing codes or miscoded items, they were unable to provide reliable  data on obligations for INL awards for democracy assistance projects in  North Macedonia for fiscal years 2012 through 2017.

Although we determined that data for specific INL democracy awards  were unreliable, INL reported providing bilateral assistance of  approximately $14.2 million in North Macedonia in fiscal years 2012  through 2017, including $6.9 million for democracy assistance.

However, we did not independently verify that INL provided this amount of  bilateral assistance.

DRL Funded Regional Democracy Assistance Awards That Included North Macedonia

DRL funded four awards that benefited North Macedonia in fiscal years  2012 through 2017. However, DRL awarded this assistance at the  regional level and does not track country-level obligations for North  Macedonia. One regional award with obligations of roughly $300,000  supported a project focusing on Roma populations in Bulgaria, North  Macedonia, Romania, and Serbia. A second regional award provided  more than $2 million for a project promoting the rule of law in the Balkans.  The two remaining DRL awards provided $25,000 to organizations  supporting local civil society organizations working to promote human  rights.

USAID Generally Followed Operational Policy in Selecting Recipients of Democracy Assistance in North Macedonia

Our review of 13 USAID grants and cooperative agreements for  democracy assistance—representing roughly half of USAID obligations in  North Macedonia in fiscal years 2012 through 2017—found that in  selecting recipients, the agency generally followed operational policies  intended to ensure a fair and transparent selection process. (See table  5 for a list of the awards in our sample.) We found that staff at the USAID  mission in North Macedonia generally evaluated applicants against the  merit review criteria stated in public notices. We also found that USAID  considered and recorded the strengths and weaknesses of applicants in  selection committee memorandums for 10 of the 13 awards in our  sample. For three awards originating from the same public notice, we  were unable to determine, on the basis of available documentation,  whether USAID considered the strengths and weaknesses of all  applicants. Finally, we found that USAID documented the review  procedures it used to assess applicants in selection committee  memorandums.

USAID Considered Published Merit Review Criteria in Selecting Recipients of Assistance

USAID’s selection committee considered merit review criteria that were  consistent with those included in the agency’s public notices for 10 of the  13 awards for democracy assistance in North Macedonia that we  reviewed. USAID’s process for selecting recipients of assistance for  competitive awards requires announcing opportunities, reviewing  applications, and making award decisions on the basis of published merit  review criteria. USAID announces a grant opportunity by developing a  notice of funding opportunity. Merit review criteria are developed by the  USAID staff and reflect the agency’s strategic priorities for democracy  assistance. After interested parties have submitted applications, a  selection committee, also known as a technical evaluation committee, is  appointed to review applications.

All 13 awards in our sample included merit review criteria in public notices  during the concept paper phase of awards, while 10 of the awards  included merit review criteria for the full application phase. Many of the  awards required selection committees to consider some of the same merit  review criteria in assessing applicants. Examples of commonly applied  criteria include the following:

Technical approach. Reviewers are to assess the extent to which an  applicant’s proposed activity is clear, logical, and technically sound  and meets the objectives of the funding outlined in the public notice.

Management plan and key personnel. Reviewers are to assess the  extent to which an applicant considered staffing, roles and  responsibilities, and other management issues for their proposed  activity.

Organizational capacity and past performance. Reviewers are to  assess the extent to which the applicant demonstrated the technical  and managerial resources and expertise to achieve their program  objectives. Reviewers are also to assess the extent to which the  applicant demonstrated technical and managerial resources and  expertise in past programs and performed satisfactorily in similar  programs executed in recent years.

We found that in reviewing the 13 awards in our sample, USAID generally  applied the criteria published for each award.

Six of the 13 awards in our sample were two-phased awards, for  which the mission required potential applicants to first submit an  executive summary or concept paper for their proposed activity. For  these awards, the mission published separate merit review criteria for  concept papers and full applications, and selection committees  assessed each type of submission against the relevant set of criteria.  The selection committee memorandums for three awards showed that  these merit review criteria were consistent with the criteria outlined in  the public notices for each award. Specifically, in the first phase of the  award process, staff at the USAID mission in North Macedonia  applied the published criteria for concept papers in reviewing the  submitted papers and selected those that best met the criteria. In the  second phase for three awards, USAID solicited applications from the  selected applicants and applied the published criteria for full  applications in reviewing the submitted applications. In the case of  three awards that originated from the same public notice, the notice  lacked merit review criteria for the full application phase. The public  notice for these three awards did not include the merit review criteria  the selection committee would use to evaluate full applications.

For the remaining seven one-phased awards in our sample, the  selection committee memorandums showed that USAID applied the  criteria published in the award solicitations in reviewing the  applications that were submitted, consistent with USAID’s operational  policies.

USAID Generally Assessed Strengths and Weaknesses of Applicants for Democracy Awards

We found that USAID officials generally assessed applicants’ strengths  and weaknesses when reviewing applications for awards for democracy  assistance in North Macedonia. USAID operational policy requires  selection committees to evaluate the strengths and weaknesses of each  applicant for an award relative to the merit review criteria. The  committee then prepares a written selection memorandum recording its  assessments, which is then sent to the agreement officer.

For the 13 awards in our sample, selection committee memorandums  show that officials generally considered and recorded their assessments  of applicants’ strengths and weaknesses against the criteria outlined in  the public notices. For example, in considering the applicants for one  award in our sample, the selection committee assessed the strengths and  weaknesses of applicants’ technical approaches by looking at the logical  connection between their activities and stated objectives, their plans for  community outreach, and their awareness of potential problems that  might arise over the course of their projects. The committee also  assessed applicants’ strengths and weaknesses with regard to  management plans and key personnel by considering, among other  things, applicants’ plans to train staff, their knowledge of the stakeholders  they planned to engage, and the relevant experience of the organizations’  leaders. In addition, the committee assessed applicants’ strengths and  weaknesses with regard to organizational capacity and past performance,  primarily by examining whether applicants had successfully managed  projects of similar magnitude, scope, and sensitivity in recent years. For  this award, the selection committee provided an overall score for each  criterion based on the numerical scoring outlined in the award’s public  notice and ultimately recommended the top-scoring applicant to the  agreement officer.

For three of the six two-phased awards we reviewed, selection committee  officials considered and recorded their assessments of applicants’  concept papers as well as the full applications they received. For three  two-phased awards that originated from the same public notice, we could  not determine, on the basis of available documentation, whether the  selection committee assessed the strengths and weaknesses of  applicants relative to the merit review criteria.

USAID Recorded Review Procedures, Consistent with Its Operational Policy

We found that USAID documented its review procedures, consistent with  USAID policy. USAID operational policy requires that the selection  committee include in its review documentation a discussion of its  procedures for reviewing awards. For all 13 awards, the selection  committee memorandums included a discussion of the review procedures  that the committee used to assess applicants. These review procedures  included actions such as the following:

The establishment of the selection committee, including its purpose  and composition

A requirement for selection committee members to sign a certificate  regarding nondisclosure, conflict of interest, or rules of conduct  Individual reviews of the applications by each selection committee  member

A review of the rating system the committee used to assess

A joint meeting to discuss individual reviews and ratings of  applications, resulting in consensus among selection committee  members about the strengths and weaknesses of each application  For the two-phased awards in our sample, the selection committee  memorandums include documentation of review procedures for both the  concept paper and full application phases of awards. The selection  committee memorandum for the full application phase of these awards  included other actions that the selection committee took, such as the  following:

A summary of the committee’s procedures and results in the concept

An evaluation of the proposals from applicants who were invited to

A discussion of the programmatic weaknesses that USAID asked  applicants to address before submitting their full applications  We are sending copies of this report to the USAID Administrator, the  Secretary of State, and the President of NED. In addition, the report is  available at no charge on the GAO website at http://www.gao.gov.

If you or your staff have any questions about this report, please contact  me at (202) 512-3149 or gootnickd@gao.gov. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on  the last page of this report. GAO staff who made key contributions to this  report are listed in appendix VII.

Appendix I: Objectives, Scope, and Methodology

Our objectives were to examine (1) U.S. funding for democracy  assistance in North Macedonia in fiscal years 2012 through 2017 and (2)  the extent to which the U.S. Agency for International Development  (USAID) adhered to relevant operational policies in selecting recipients of  democracy assistance in North Macedonia.

To identify the United States’ strategic objectives and goals for providing  democracy assistance in North Macedonia, we reviewed USAID and  Department of State (State) strategic documents and interviewed  cognizant USAID and State officials in Washington, D.C.

To examine U.S. funding for democracy assistance in North Macedonia,  we analyzed award data from USAID, State, and the National Endowment  for Democracy (NED) for fiscal years 2012 through 2017, the most recent  5-year period for which these data were available. To determine the  data’s reliability, we interviewed agency officials and reviewed relevant  documentation. We determined that USAID’s and NED’s data were  sufficiently reliable for the purposes of our reporting objectives. We further  determined that State’s data on the U.S. Embassy in Skopje’s Public  Affairs Section awards were reliable for these purposes. However, on the  basis of interviews with State officials, our review of their data, and our  prior work, we determined that the data maintained by State’s Bureau of  International Narcotics and Law Enforcement Affairs (INL) could not be  reliably reported. We determined that data provided by State’s Bureau of  Democracy, Human Rights, and Labor Affairs (DRL) were reliable;  however, we could not determine what portion of DRL funding went only  to North Macedonia, because DRL made regional awards during this  period that benefited several Balkan countries. Therefore, we report State  obligations as approximations for awards for which we had more reliable  data. To identify the recipients of democracy assistance in North  Macedonia and describe the process through which the U.S. government  grants such assistance, we reviewed award data, relevant award  documents, and bilateral agreements and other communications between  the United States and North Macedonia regarding this assistance.

We interviewed USAID, State, and NED officials in Washington, D.C.,  who oversee democracy assistance in North Macedonia regarding U.S.  funding for such assistance. We also interviewed representatives of  organizations that implement this assistance that have offices in  Washington, D.C. In addition, during audit work in Skopje, North  Macedonia, we interviewed USAID and State officials who manage  democracy assistance. We also met with officials from the government of  North Macedonia, including the Minister of Defense and members of  Parliament, the State Election Commission, and the Agency for Audio and  Audiovisual Services, to determine the types of activities the U.S.  government supported during the period of our review. In addition, we  conducted individual and group interviews with representatives of 41  implementing partners of USAID, State, and NED in Skopje who received  funding during the period of our review.

To assess the extent to which USAID officials followed operational  policies in selecting recipients of democracy assistance, we analyzed  award data and documentation for a sample of awards made between  fiscal years 2012 through 2017. We excluded from our sample any  contracts and other awards for which no public notice was issued,  because these awards were not openly competed. We further excluded  grants under contract arrangements that USAID entered into with local  partners in North Macedonia, because these awards also were not openly  competed. Such awards include those made by USAID’s Office of  Transition Initiatives and under the Consortium for Elections and Political  Process Strengthening process. Our sample comprised the 13 largest- value grants and cooperative agreements that USAID made for North  Macedonia in fiscal years 2012 through 2017, constituting 46 percent of  all USAID obligations in North Macedonia during this period. We analyzed  USAID operational policies contained in the Automated Directives System  (ADS) and other USAID policy documents outlining the agency’s strategic  plan and assistance priorities for North Macedonia. We analyzed relevant  documents for the awards in our sample, including the notices of funding  opportunity and selection committee memorandums, and we assessed  the extent to which these documents showed that USAID had met the  requirements of its operational policy outlined in the ADS. In particular, for  each award, we examined the extent to which  the merit review criteria published in the notice of funding opportunity  matched the criteria the selection committee used,  the selection committee assessed the strengths and weaknesses of  the submitted applications and recorded these assessments, and  the selection committee included a discussion of its review  procedures in its review documentation.

Finally, we interviewed USAID officials in Washington and Skopje  regarding USAID’s operational policies in fiscal years 2012 through 2017  as well as its process for selecting recipients of democracy assistance.

Appendix II: U.S. Agency for International Development Democracy Assistance in North Macedonia

Table 6 lists the U.S. Agency for International Development’s (USAID)  awards for democracy assistance in North Macedonia in fiscal years 2012  through 2017.

Appendix III: National Endowment for Democracy Assistance in North Macedonia

Table 7 lists the National Endowment for Democracy’s (NED) democracy  assistance awards in North Macedonia in fiscal years 2012 through 2017.

Appendix IV: Department of State Democracy Assistance in North Macedonia

Tables 8 and 9 list the Department of State’s (State) awards for  democracy assistance to North Macedonia in fiscal years 2012 through  2017. These awards were provided by U.S. Embassy Skopje through its  Public Affairs Section. Table 8 shows the grants that the embassy’s  Public Affairs Section awarded through the Democracy Commission  Small Grants Program, and table 9 shows other, non–Democracy  Commission grants awarded by the Public Affairs Section.

Appendix V: Democracy Assistance Program Areas and Program Elements

Table 10 provides an overview of the program areas and program  elements that fall into democracy, human rights, and governance  assistance according to the Department of State (State). U.S. foreign  assistance is categorized through a system called the Standardized  Program Structure and Definitions, which comprises broadly agreed-on  definitions for foreign assistance programs and provides a common  language to describe programs. According to this system, democracy  assistance includes the following six program areas.

Appendix VI: Comments from the U.S. Agency for International Development

Appendix VII: GAO Contact and Staff Acknowledgments

In addition to the contact named above, Rob Ball (Assistant Director),  Cheryl Goodman (Assistant Director), Rachel Dunsmoor (Analyst-in- Charge), Parul Aggarwal, R. Gifford Howland, Ashley Alley, Justin Fisher,  Christopher Keblitis, and Reid Lowe made key contributions to this report.

The United States has provided over $1 billion in aid for North Macedonia, partly to help strengthen democracy in the country since its 1991 independence from Yugoslavia. U.S. agencies have expressed concerns about an erosion of democracy there since assessing in 2011 that government control of the judiciary and media was increasing.

We found U.S. democracy assistance in North Macedonia totaled over $45 million in fiscal years 2012-2017. This included funding to support independent media and free and fair elections. We also reviewed 13 USAID grants and agreements and found the agency generally followed its policies when choosing recipients.


Medicaid: Opioid Use Disorder Services for Pregnant and Postpartum Women, and Children

The misuse of prescription opioid pain relievers and illicit opioids, such as heroin, has contributed to increases in OUD and overdose deaths. Pregnant women with OUD have an increased risk of overdose during the postpartum period. Opioids also caused over half of drug overdose deaths among youth in 2017. Medicaid plays a key role in covering services to treat OUD for low-income women and children.

The SUPPORT Act includes a provision for GAO to study Medicaid coverage for pregnant and postpartum women with a substance use disorder, including OUD. The act also includes a provision for GAO to examine children's access to these services, such as through telehealth. This report describes Medicaid coverage of OUD services for (1) pregnant and postpartum women in selected states; (2) children in selected states; and (3) children delivered via telehealth in schools across all states, and utilization of these services.

GAO reviewed documentation and interviewed officials from federal agencies within HHS to understand Medicaid coverage of OUD services for pregnant and postpartum women, as well as children. GAO also interviewed officials and reviewed documentation from six states selected for variation in opioid use rates, status of Medicaid expansion, and geographic variation, among other things. GAO also conducted outreach and received responses from 49 of 50 states and the District of Columbia about Medicaid coverage and use of OUD services delivered via telehealth in schools.

HHS provided technical comments, which were incorporated as appropriate.

All state Medicaid programs are required to provide coverage of health care services to pregnant women with incomes at or below 138 percent of the federal poverty level through 60 days postpartum. With regard to opioid use disorder (OUD), GAO found that six selected state Medicaid programs provide coverage of a range of services for eligible pregnant women with OUD. Specifically, the six states—Alabama, Arkansas, Colorado, Massachusetts, South Dakota, and Texas—covered OUD services, such as screening for opioid use, counseling, and medication-assisted treatment, which combines the use of medications with counseling. In the six selected states, women who are eligible for Medicaid coverage after 60 days postpartum can receive most of the same OUD services that were covered during pregnancy. Furthermore, GAO found that the six selected states also use other sources of funding, such as federal grants, to provide coverage of OUD services for postpartum women who are not eligible for Medicaid. GAO did not review how frequently the OUD services were actually provided to pregnant and postpartum women.

GAO found that the state Medicaid programs in all six selected states cover annual screenings for substance use, which includes opioid use, for eligible children. This coverage is provided as part of Medicaid's Early and Periodic Screening, Diagnostic, and Treatment benefit, under which all states are required to cover certain screenings for eligible children under age 21.

GAO also found that Medicaid programs in 31 states and the District of Columbia covered OUD services, including screenings, delivered through telehealth in schools. However, state Medicaid officials said they were not aware of any instances of these services being utilized through telehealth in schools. Telehealth can be used to provide clinical care remotely, such as for screening, counseling, and therapy. Such services could be provided, for example, via a video conference on a desktop computer or laptop that connects a student in school with a provider in another location. State officials and experts cited both benefits and challenges with providing OUD services through telehealth in schools. For example, benefits included addressing provider shortages, particularly in rural areas, as well as reducing the amount of time students spend outside of the classroom accessing services. Challenges included lack of needed infrastructure and provider discomfort with using telehealth. Agencies within the Department of Health and Human Services (HHS) have recently issued guidance emphasizing the use of telehealth for OUD services, particularly in schools.

The misuse of and addiction to prescription opioid pain relievers and illicit  opioids, such as heroin, have contributed to increases in opioid use  disorder (OUD), as well as overdose deaths, in the United States. Over  70,000 people died from drug overdoses in 2017, according to the  Centers for Disease Control and Prevention, and opioids are a main  driver of overdose deaths. Low-income pregnant and postpartum women,  as well as children, are particularly vulnerable to the adverse effects of  OUD. Pregnant women with OUD face a high risk of poor neonatal  outcomes, such as having preterm labor or having a newborn with  neonatal abstinence syndrome, and have an increased risk of overdose  during the postpartum period.

Medicaid, the federal-state program that finances health care coverage  for low-income and medically needy populations (including eligible  pregnant women and children), plays a key role in covering services for  the treatment of OUD. The Centers for Medicare & Medicaid Services  (CMS)—a federal agency within the Department of Health and Human  Services (HHS)—oversees Medicaid, while each state administers its  own Medicaid program. State Medicaid programs must provide health  care coverage to certain pregnant women, including those with incomes  at or below 138 percent of the federal poverty level (FPL) through 60 days  postpartum. However, states have flexibility in determining which specific  services are covered. Congress and stakeholders have raised questions  about the extent to which OUD services are covered under states’  Medicaid programs during pregnancy, as well as whether women who  qualify for Medicaid during pregnancy can continue receiving OUD  services beyond 60 days postpartum.

Congress has also raised questions about whether children have  adequate access to OUD screening and treatment services under  Medicaid. Among adolescent children, the rate of opioid use remains  relatively low compared to other substances; according to the National  Institute on Drug Abuse, in 2018, approximately 6 percent of 12th graders  reported using an opioid in their lifetime. Nevertheless, opioids caused  over half of drug overdoses among youth in 2017. According to the Office  of National Drug Control Policy, the most effective way to mitigate the  costs associated with illicit drug use is through prevention, which includes  having primary care providers screen and intervene with patients at risk  for opioid use. CMS and the Substance Abuse and Mental Health  Services Administration (SAMHSA)—a federal agency within HHS that  leads public health efforts to reduce the impact of substance abuse and  mental illness—jointly issued guidance in July 2019 stating that early  intervention and treatment are critical to improving outcomes and that  schools can fill a critical role in identifying children with OUD and referring  them to treatment. This guidance also states that telehealth—the use of  technology, including interactive telecommunication, to deliver health care  services, such as counseling, to patients—can be an effective way to  increase children’s access to mental health services. However, little has  been known about the extent to which OUD services are delivered  through telehealth, particularly in schools.

The Substance Use–Disorder Prevention that Promotes Opioid Recovery  and Treatment for Patients and Communities Act (SUPPORT Act)  includes a provision for GAO to conduct a study on Medicaid coverage for  pregnant and postpartum women with a substance use disorder, including  OUD. The SUPPORT Act also includes a provision for GAO to study  options to improve access to these services for children, including  through telehealth in schools. This report describes  1.  Medicaid coverage of OUD services for pregnant and postpartum  women in selected states;  2.  Medicaid coverage of OUD services for children in selected states;  3.  Medicaid coverage of OUD services delivered to children via  telehealth in schools across all states, and what is known about  utilization of these services.

To describe Medicaid coverage of OUD services for pregnant and  postpartum women in selected states, we reviewed federal and state  documentation, and interviewed federal and state Medicaid officials.  Specifically, we reviewed CMS policies and guidance, and interviewed  CMS officials to understand the federal parameters for Medicaid coverage  of services for pregnant and postpartum women with OUD. We also  reviewed documentation and conducted interviews with officials from six  selected states—Alabama, Arkansas, Colorado, Massachusetts, South  Dakota, and Texas. We selected these states to provide variation in OUD  rates, Medicaid expansion status, and geographic location. We also  included states with different levels of Medicaid coverage for pregnant  women as of 2019, such as states that offer pregnancy-related coverage;  states that offer coverage beyond 60 days postpartum; and states with  specific programs for pregnant and postpartum women with OUD. We  reviewed documentation—including state plans, health care provider  manuals, and waivers—of the six selected states’ Medicaid coverage of  OUD services for pregnant and postpartum women.

In discussing OUD services covered for pregnant and postpartum women  with state Medicaid and behavioral health officials, we refer to a set of  services to treat OUD. Based on background research and interviews  with CMS and other expert stakeholders, we were unable to identify an  existing list of a standard set of services used to treat OUD. We therefore  developed our own list of OUD services to discuss with states. We did  this using documentation from CMS; the American Society of Addiction  Medicine; and states, including information on state substance use  disorder treatment programs. We interviewed state Medicaid and  behavioral health officials about whether these services were covered for  pregnant and postpartum women. However, we did not review state  information to determine how frequently these services are actually  provided to pregnant and postpartum women. We also requested the six  selected states provide estimates of the number of women who  maintained Medicaid coverage after 60 days postpartum. We asked  state officials to describe the steps they took to compile and ensure the  accuracy of these estimates, and determined that the estimates were  sufficiently reliable for the purpose of our report. We also reviewed federal  and selected states’ documentation on SAMHSA grants that can be used  to fund services for target populations—such as pregnant and postpartum  women—and interviewed SAMHSA and state officials about these grants.  The information we obtained from the selected states is not generalizable  to other states or nationally.

To describe Medicaid coverage of OUD services for children, we focused  our review on non-infant children and reviewed federal and state  documentation, and interviewed federal and state Medicaid officials.  Specifically, we reviewed CMS policies and guidance, and interviewed  CMS officials to understand the federal parameters for Medicaid coverage  of children with OUD. We also reviewed documentation—including state  plans and health care provider manuals—and interviewed officials from  the six selected states about coverage of OUD services for children as of  2019. We also interviewed officials from the six selected states about  any challenges in providing OUD services to children and any state  initiatives to address children’s access to OUD services. The information  obtained from the selected states is not generalizable to other states or  nationally.

To describe Medicaid coverage of OUD services delivered to children via  telehealth in schools across all states, and what is known about utilization  of these services, we conducted outreach via email and phone calls to all  50 states and the District of Columbia between February and July 2019.  We obtained information about whether state Medicaid programs cover  OUD services delivered via telehealth in schools and, if they do, to what  extent such services have been provided. We also reviewed  documentation and conducted interviews with officials from CMS and  SAMHSA about guidance related to telehealth and delivery of OUD  services in schools. We also reviewed documentation and spoke with  officials from the Health Resources and Services Administration (HRSA),  the federal agency within HHS that works on improving health care for  vulnerable populations, about federal grants used to provide states with  funding for telehealth programs. Lastly, we conducted interviews with  officials from the six selected states, officials from four telehealth  programs, and four subject matter experts to learn about any programs  delivering OUD services via telehealth in schools, and any potential  benefits and challenges of delivering OUD services via telehealth in  schools.

We conducted this performance audit from November 2018 to October  2019 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.

Opioids—such as hydrocodone, oxycodone, morphine, and methadone— can be prescribed to treat both acute and chronic pain. Many opioids  have a high potential for abuse and may lead to severe psychological or  physical dependence. OUD, which is a type of substance use disorder, is  generally characterized by a loss of control of opioid use, risky opioid use,  impaired social functioning, tolerance, and withdrawal.

According to SAMHSA and the National Institute on Drug Abuse, OUD is  a chronic, treatable illness. SAMHSA states that treatment for OUD  should be individualized and can include a range of treatment options that  include medication and behavioral health services. Specifically, services  related to the treatment of OUD include the following:

Screening can identify individuals who have OUD, are at risk for  developing OUD, or have medical problems related to opioid use.  Screening, brief intervention, and referral to treatment (SBIRT) is a  specific type of screening that involves a health care provider  educating individuals with a positive screen for opioid use and  referring them to specialized treatment, as needed.

Outpatient counseling and therapy includes counseling and  treatment services individually or in a group.

Inpatient hospital services include those that occur in a hospital,  such as services for detoxification.

Inpatient residential services include care in a 24-hour residential  setting. Inpatient residential providers offer medical care in  combination with housing, typically lasting from a week to several  weeks or more.

Medication-assisted treatment (MAT) combines the use of certain  prescription medications (such as methadone, buprenorphine, and  naltrexone) and behavioral therapy. Methadone and buprenorphine  suppress withdrawal symptoms and control the craving for opioids,  while naltrexone suppresses the euphoric effects of opioids. Research  has shown that MAT for OUD reduces opioid use and increases the  chance that patients will continue OUD treatment compared to  abstinence-based treatment (where patients are treated without  medication).

Case management services include providing coordination and  management of care across multiple health care providers.

Crisis intervention includes immediate care intended to prevent  harm.

Peer recovery coaching includes recovery support through a  certified peer specialist with experience of recovery from addiction.

States administer their Medicaid programs within broad federal  requirements and according to a state plan approved by CMS. The  Medicaid program allows states to design and implement their programs  within certain federal parameters, resulting in more than 50 distinct  programs. A state’s approved Medicaid plan outlines the services  provided and the groups of individuals covered. States also have the  option of using waivers to expand services under the Medicaid program.  As such, the types of services covered by Medicaid can vary across  states.

Historically, Medicaid eligibility has been limited to certain categories of  low-income individuals, such as children, parents, pregnant women,  persons with disabilities, and individuals aged 65 and older. The Patient  Protection and Affordable Care Act (PPACA), enacted in 2010, allowed  states to expand Medicaid coverage to nearly all individuals with incomes  up to 138 percent of the FPL, regardless of eligibility category. As of  October 2019, 33 states and the District of Columbia expanded Medicaid  eligibility, and 17 states had not.

Medicaid Services for Pregnant and Postpartum Women

Under federal law, state Medicaid programs must provide coverage for  health care services for certain pregnant women, including low-income  pregnant women with incomes at or below 138 percent FPL. Most  states opt to extend coverage to pregnant women with incomes above  this threshold. By statute, states are permitted to limit the services  covered for certain pregnant women, including low-income pregnant  women, to services related to the pregnancy. Such coverage is referred  to as “pregnancy-related coverage.” CMS defines pregnancy-related  services as those services necessary for the health of the pregnant  woman and fetus, or that have become necessary as a result of the  woman having been pregnant, which includes prenatal, delivery,  postpartum, and family planning services, as well as services for other  conditions that may complicate the pregnancy. In contrast, states are  required by statute to provide pregnant women who qualify for Medicaid  on another basis, such as a disability, full Medicaid benefits. At a  minimum, states must provide Medicaid coverage for pregnant enrollees  through 60 days postpartum, though states may extend coverage  further. Some women may qualify for continued Medicaid coverage after  the 60-day postpartum period if they meet the requirements for another  eligibility pathway, such as for parents, while others may transition to  other programs or become uninsured.

Medicaid’s Early and Periodic Screening, Diagnostic, and Treatment  (EPSDT) benefit is the primary mechanism to help ensure the provision of  appropriate health care services to children under Medicaid. Under the  EPSDT benefit, states are required to cover comprehensive health  screenings and preventive health services, such as those related to vision  and oral health, and all other Medicaid coverable services that are  necessary to correct or ameliorate any conditions discovered through  screenings. States are required to follow a schedule of screenings,  known as a periodicity schedule, that are recommended for children at  specific ages and frequencies. States can develop their own schedule  within federal parameters or follow an established schedule, such as from  the American Academy of Pediatrics (AAP).

States are required to report annually on the provision of certain EPSDT  services to CMS. States must report information on the number of  children provided health screening services, the total number of health  screenings services provided, the number of children referred for  corrective treatment, the number of children receiving dental services,  and the state’s results in attaining EPSDT participation goals. States  may also voluntarily report annually on the quality of health care services  provided under EPSDT using a set of quality measures known as the  Child Core Set. CMS plans to increasingly use the Child Core Set in the  future and state reporting will be mandatory beginning with the state  reports for fiscal year 2024.

States also have flexibility in determining where EPSDT services can be  delivered. As a means of improving access—particularly in underserved  communities, such as rural areas—Medicaid programs may cover certain  services delivered by health care providers in schools. There were  approximately 130,000 schools across the United States as of 2016,  according to data from the Department of Education. Some of these  schools have health clinics. Additionally, there were approximately 2,600  school-based health centers as of 2017, some of which served children in  underserved communities, according to the School-Based Health  Alliance.

Telehealth as a Modality to Provide Services

Some state Medicaid programs allow for services to be delivered via  telehealth, including in schools. Telehealth can be used to provide clinical  care remotely, such as for screening, counseling, and therapy. Health  care providers offer care to patients through remote technology, such as  a live, two-way video call. Such services could be provided, for example,  via a video conference on a desktop computer or laptop that connects a  student in school with a provider in another location. States have flexibility  to choose whether to cover services delivered via telehealth. Because the  federal Medicaid statute does not recognize telehealth as a distinct  service, CMS views telehealth as a service delivery mechanism.  According to CMS, services delivered via telehealth are subject to the  same Medicaid requirements as those services provided in person.

Selected States Provide Medicaid and Other Coverage for a Range of Opioid Use Disorder Services for Eligible Pregnant and Postpartum Women

Selected States Provide Medicaid Coverage of Most Opioid Use Disorder Services for Eligible Pregnant Women and Women through 60 Days Postpartum

The Medicaid programs in our six selected states provided coverage of  most OUD services during pregnancy and the first 60 days postpartum,  as of January 1, 2019. Specifically, the selected states’ Medicaid manuals  indicate these states provide coverage for at least seven of the eight OUD  services we identified in our review, such as screenings, inpatient and  outpatient services, and MAT. (See fig. 1.)

In the six states we reviewed, we did not identify differences between the  types of covered OUD services for pregnant women in expansion and  non-expansion states. For example, the three expansion states— Arkansas, Colorado, and Massachusetts—and the three non-expansion  states—Alabama, South Dakota, and Texas—each covered at least  seven of the eight OUD services for pregnant women.

Similarly, we did not identify differences in Medicaid coverage for OUD  services between the selected states that limited coverage to pregnancy- related services and those that provided full benefits. Arkansas and South  Dakota—the two states providing only pregnancy-related coverage— covered seven of the eight OUD services for pregnant women. According  to Medicaid officials in these two states, the programs cover these OUD  services because they are considered medically necessary. In contrast,  neither state generally provides Medicaid coverage for peer recovery  coaching for beneficiaries, including pregnant women.

Three of the selected states—Alabama, Colorado, and Texas—covered  certain OUD services for pregnant women that they do not cover for other  beneficiaries under Medicaid. For example, in Alabama, screening  services and inpatient residential services were covered only for pregnant  women, but not other eligible, low-income women. In Colorado, pregnant  women were the only group in the state for whom residential OUD  services were covered under Medicaid. In Texas, pregnant women were  the only group in the state for whom case management is a covered  service under Medicaid.

Selected States Provide Medicaid Coverage for Most Opioid Use Disorder Services If Women Are Able to Maintain Medicaid Eligibility beyond 60 Days Postpartum

In all six selected states, once Medicaid coverage furnished on the basis  of pregnancy ends after 60 days postpartum, women can continue to  receive most OUD services under Medicaid if they qualify for Medicaid on  another basis. For example, these women could qualify if their income is  equal to or lower than the maximum allowable income for parents.  However, in the six selected states, the maximum allowable income for  eligible parents was generally lower than that for pregnant women, as of  January 2019. (See fig. 2.)

Women in the six selected states who are eligible to maintain Medicaid  coverage after 60 days postpartum can continue most of the same OUD  services that were covered during pregnancy. However, officials in two  states said that the OUD services covered specifically for pregnant  women under Medicaid would generally not be covered after the  postpartum period ends. Four of the selected states provided estimates of  the number of women who maintain Medicaid eligibility after the  postpartum period ends. For example, officials in Massachusetts, an  expansion state, estimated that in 2017 and 2018, approximately 99  percent of women with Medicaid coverage while pregnant maintained  Medicaid coverage after the postpartum period ended. State officials in  Colorado, also an expansion state, estimated that in 2015, 75 percent of  women maintained coverage after the postpartum period ended.  Additionally, in Arkansas, another expansion state, officials estimated that  about 60 percent of women in 2017 and 2018 maintained Medicaid  coverage after the postpartum period ended. Officials in Alabama, a  non-expansion state, estimated that in 2017, about 43 percent of women  maintained Medicaid coverage after the postpartum period ended.

States may also obtain approval from CMS, such as under a waiver, to  extend Medicaid coverage for women with OUD beyond 60 days  postpartum, according to CMS officials. However, CMS officials were not  aware of the number of states that have done so. In our review, we found  that one of the six selected states, Colorado, used a section 1915(b)  waiver to extend Medicaid eligibility for substance use services, including  OUD services, for women beyond 60 days postpartum. Under the state’s  “Special Connections” program, which was approved under the waiver,  women who are eligible for Medicaid during their pregnancy can continue  Medicaid coverage for OUD services for up to 12 months postpartum,  including inpatient residential services, which would not otherwise be  covered under Medicaid. A state official told us that the program began in  1991 to provide substance use disorder services to pregnant women and  up to 60 days postpartum. In 2006, the state extended coverage under  the program to provide substance use disorder services up to 12 months  postpartum. The program aids in early identification and intervention for  pregnant women with substance use disorders who are at risk of  delivering low birth weight babies with health complications. Officials said  the goal of the program is to improve the likelihood that the mother  remains free from substance abuse. According to Colorado officials, 227  women participated in the program in 2018.

Selected States Use Other Funding Sources to Provide Coverage of Opioid Use Disorder Services for Postpartum Women Not Eligible for Medicaid

We also found that the six selected states use other funding sources to  provide coverage of OUD services for women with incomes that exceed  the state’s Medicaid eligibility thresholds. Officials from the six selected  states reported that they received SAMHSA grants so each state could  provide OUD services for pregnant and postpartum women that extend  beyond 60 days. According to the SAMHSA officials we interviewed,  grants have been used to increase access to MAT, expand recovery  support for pregnant women, and provide enhanced services for women  to access OUD treatment. Furthermore, SAMHSA officials said that  pregnant and postpartum women are specifically identified as target  populations for grants, such as the agency’s State Targeted Response to  the Opioid Crisis grant and its State Opioid Response grant. For  example, officials in Arkansas told us that by using SAMHSA grants, they  are able to allow uninsured or underinsured women who are seeking  treatment for OUD to continue MAT treatment after 60 days postpartum.  In addition, officials in the six selected states told us that women beyond  60 days postpartum generally would not experience gaps in treatment for  OUD when transitioning from Medicaid to SAMHSA grant-funded  programs, as women can generally continue receiving the same services  and seeing the same providers. For example, state officials in Alabama,  South Dakota, and Texas told us the state Medicaid agency contracts  with providers that agree to participate in both the state’s Medicaid  program and SAMHSA’s grant programs to allow for continuity of eligible  services.

Officials in Texas also told us they used state funds to implement a  program to provide OUD services for up to 18 months postpartum. State  officials told us that in this program—called the Neonatal Abstinence  Syndrome-Opioid Treatment Services program—when a woman’s  Medicaid coverage ends, she transitions to state-funded treatment to  continue the same OUD services with the same provider. According to  state officials, this program, funded since 2015, expands treatment  services to postpartum women who would typically lose Medicaid  coverage and become unable to pay for MAT services, which officials say  help reduce relapse, overdose, and maternal mortality risk. State officials  added that there is flexibility to extend services for postpartum women  participating in the program for up to 2 years, if needed. State officials told  us that since 2016, 296 women have participated in the program.

In addition to the efforts in the selected states, the federal government  has planned efforts to help states combat the opioid crisis, specifically for  pregnant and postpartum women with OUD. For example, CMS plans to  offer up to 12 cooperative agreements to states under the Maternal  Opioid Misuse model as a way to improve access to services under  Medicaid to pregnant and postpartum women with OUD. The model will  have a 5-year performance period, 2020 through 2024, to allow states to  implement strategies to improve the quality of care for pregnant and  postpartum women with OUD. According to CMS officials, the model does  not require that states extend coverage beyond 60 days postpartum, but  states could choose to do so. CMS published the funding opportunity for  the model in February 2019, and plans to select states to participate by  the fall of 2019. In July 2019, CMS issued guidance to states regarding  Medicaid coverage of services such as counseling for postpartum women  while their infant is receiving treatment for Neonatal Abstinence  Syndrome. The Centers for Disease Control and Prevention also issued  a publication in September 2019 summarizing an initiative on state  strategies to address OUD among pregnant and postpartum women and  infants prenatally exposed to substances. The initiative identified five  focus areas, including access to and coordination of quality services,  provider awareness and training, and financing and coverage. In  addition, the SUPPORT Act includes a provision for HHS to issue  guidance to improve care for postpartum women with substance use  disorder by the fall of 2019.

Selected States Provide Medicaid Coverage for Annual Screenings and Any Medically Necessary Services for Substance Use, Including Opioids, for Eligible Children

The six selected states provide Medicaid coverage for annual screenings  of eligible children for substance use, including opioids, as well as any  medically necessary treatment for conditions identified through these  screenings, as of 2019. This coverage is provided through the Medicaid  EPSDT benefit. Based on our review of Medicaid state plans and  EPSDT policies and periodicity schedules, we found that the six selected  states established the following screening schedules at the time of our  review:

Arkansas’ Medicaid state plan and Colorado’s and South Dakota’s  EPSDT policies specify that these states follow AAP’s screening  schedule. AAP recommends annual substance use screening for all  children beginning at age 11 until they reach the age of 21.

Alabama’s EPSDT policy requires annual screening for all children  ages 6 to 13.

Massachusetts’ EPSDT policy requires providers to conduct an  annual assessment of every child’s risk for substance use as part of a  health history assessment during a child’s annual visit. This  assessment can be conducted at any age.

Texas’ EPSDT periodicity schedule recommends annual screening for  all children ages 12 to 18.

Additionally, Massachusetts and Texas Medicaid programs require  behavioral health screening for all eligible children. The Medicaid  programs in these states provide separate payment for behavioral health  screening if the screening is conducted using an approved screening tool,  some of which also screen for substance use, such as opioids. Texas  officials reported that substance use screenings are considered part of  the required overall mental health screening component of annual  checkups. Similarly, Arkansas officials said that as part of a new EPSDT  policy they are drafting, the state Medicaid program will require behavioral  health screening for all children, which can include substance use  screening if determined medically necessary by the provider.

The six selected state Medicaid programs report data on the total number  of screenings provided under EPSDT for children’s health care needs.  However, officials from five of the selected states said that it is difficult or  impossible to separate and thus track the number of the substance use  screenings as distinct from other types of EPSDT screenings or visits that  are recorded in Medicaid data. States are required to track and report  the total number of EPSDT screenings provided, but not the number of  substance use disorder screenings.

Officials from all six selected states said that they conduct outreach and  education to providers and parents to ensure awareness of the EPSDT  benefits, as required. We found that the extent of information the states  provide on these services varied among the six states. For example,  outreach materials from three of the six selected states included  information about the availability of substance use screening, and one of  these three states, Alabama, also included information about services for  opioid use.

For all six selected states, officials emphasized that Medicaid’s EPSDT  benefit requires states to cover any medically necessary treatment or  service to address health conditions for a child, including opioid use.  Officials from the six selected states also described a variety of initiatives  to increase access to substance use disorder, including OUD, services for  children. For example:

Officials from Alabama said they recently began a program that offers  more substance use disorder services in schools in a face-to-face  capacity to help increase convenience and reduce stigma around  these services for both the children and the parents. They explained  that the Alabama Department of Mental Health added modifiers to  ensure that their systems can capture data appropriately and analyze  trends in providing school-based services, which are currently offered  in over 40 individual schools. Officials added that Medicaid pays for  covered services that are provided to Medicaid-eligible children in  schools under this program.

Officials from two states—Arkansas and Massachusetts—said they  recently expanded the types of substance use disorder services  covered for all Medicaid beneficiaries. Officials from Arkansas added  that they are working to expand the number of providers who can offer  substance use disorder treatment under Medicaid.

Officials from two states—Massachusetts and Texas—said they had  recently developed programs specifically aimed at serving children  with substance use disorder, including OUD, using federal authority.  Massachusetts received approval from CMS to conduct a Medicaid  demonstration to establish OUD programs for children. Texas is using  SAMHSA grant funding to support eight youth recovery centers that  are intended to improve services and recovery supports for youth with  substance use disorder, including OUD.

Over 30 States Reported Medicaid Coverage of Opioid Use Disorder Services Delivered through Telehealth in Schools, but No Evidence Services are Being Used

We conducted outreach to Medicaid officials from all 50 states and the  District of Columbia between February and July 2019 to inquire about  whether the state provided Medicaid coverage of OUD services delivered  via telehealth in schools as a means of increasing access to these  services for children. Officials from 31 states and the District of Columbia  reported that they provide Medicaid coverage of OUD services delivered  in schools via telehealth. Medicaid officials from some states reported  that their Medicaid policies explicitly allow for coverage of OUD services  provided in schools via telehealth, while others reported that they allow  for Medicaid coverage of these services, but their policies do not explicitly  address the issue. (See app. I for the state responses regarding Medicaid  coverage of OUD services provided in schools via telehealth.)

Officials from the remaining 18 states reported that their Medicaid policies  do not allow for payment for OUD services delivered in schools via  telehealth. Some of these state officials reported that they did not allow  schools to serve as a location for patient services during a telehealth visit  for Medicaid payment purposes. Other state officials reported that they  allowed Medicaid payment for certain services provided in schools via  telehealth, but OUD services were not among them. For example, officials  from Texas said the state established a school-based telehealth program  for behavioral health services. However, this program does not include  services for the treatment of substance use disorder, including OUD.  Officials added that the state has a requirement that substance use  disorder services can only be delivered in certain approved facilities.

While Medicaid officials from 31 states and the District of Columbia  reported that they provide Medicaid coverage of OUD services in schools  via telehealth, they also said they were not aware of any instances of  these services being utilized. Medicaid officials from the 31 states and the  District of Columbia reported that either these services were not being  provided based on data or other information they had, or they were  unaware if the services were being provided. Officials from seven states  responded that they either reviewed Medicaid utilization data or asked  school-based staff and determined that there was no utilization of these  services. For example, officials from one state—Ohio—conducted a data  query and found that in 2018 there had been two instances of substance  use disorder services billed to Medicaid that were delivered via telehealth  in a school. However, officials noted that these instances involved  treatment for substances other than opioids. While not for OUD, these  two instances were the only instances of Medicaid payment for substance  use disorder services delivered via telehealth in schools that we identified  in our review.

As part of our outreach to states and background research, we did find  that some states or localities have taken steps to facilitate the use of  telehealth for delivery of substance use disorder services, including OUD,  in schools. For example:

Officials from one county in Maryland said they recently began using a  telehealth smart device application to screen students in schools for  substance use disorder, including OUD, and refer them to treatment.  However, county officials said that the program was locally funded,  and they had not considered seeking Medicaid payment.

A South Dakota tribal reservation recently implemented a new school- based telehealth program for behavioral health. According to officials,  this program could include OUD services delivered via telehealth in  schools, and these services could be billed to Medicaid if the provider  was already licensed to bill Medicaid; however, officials said that none  of these services had been provided to date.

Massachusetts recently expanded its Medicaid telehealth policy to  allow for the payment of mental health and substance use disorder  services provided in many locations, including schools. However,  officials said the state was still building the telehealth infrastructure,  and services had not yet been provided at the time of our review.  Officials were unsure whether OUD services would be delivered via  telehealth in schools under the new policy once implementation  began.

State officials and subject matter experts that we spoke with also reported  a range of potential benefits and challenges associated with providing  substance use disorder services, including OUD services, in schools via  telehealth. (See table 1.)

There have also been federal efforts to emphasize the use of telehealth to  improve access to OUD services for children. For example, these efforts  include the following:  In June 2018, CMS issued guidance emphasizing the use of  telehealth as a means of improving access to OUD services and  noted that states need not necessarily submit a change to their state  plan to begin delivering covered Medicaid services through  telehealth. Similar to what we heard from experts, this guidance  suggests that leveraging technology to provide such services might  help with addressing provider shortages, particularly in rural areas.

In July 2019, CMS and SAMHSA jointly issued guidance on  addressing mental health and substance issues in schools. The  guidance states that telehealth for mental health services in schools  has been found to be effective. This guidance also emphasizes that  telehealth can be helpful for ensuring that Medicaid services are  provided to Medicaid beneficiaries who are in rural areas or in areas  where qualified practitioners are scarce.

HRSA officials we spoke with also described several different HRSA  programs from which funds could be used to facilitate or deliver  substance use disorder services via telehealth, including in some  school-based health centers; however, the officials were not able to  determine whether telehealth is being utilized to deliver OUD services  in school-based health centers, specifically.

The SUPPORT Act also includes a provision for HHS to issue guidance  to states on Medicaid coverage of substance use disorder services  delivered via telehealth, including in school-based health centers, by fall  of 2019.

We provided a draft of this report to HHS for review. HHS provided  technical comments, which we incorporated as appropriate.

We are sending copies of this report to the Secretary of Health and  Human Services, the Administrator of the Centers for Medicare &  Medicaid Services, the Health Research and Services Administration, the  Substance Abuse and Mental Health Services Administration, and other  interested parties. In addition, the report is available at no charge on the  GAO website at http://www.gao.gov.

If you or your staff have any questions about this report, please contact  Jessica Farb at (202) 512-7114 or farbj@gao.gov. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on  the last page of this report. Major contributors to this report are listed in  appendix II.

Appendix I: State Reported Medicaid Coverage of Opioid Use Disorder Services Delivered through Telehealth in Schools

Appendix II: GAO Contact and Staff Acknowledgements

In addition to the contact named above, Rashmi Agarwal (Assistant  Director), Kaitlin McConnell (Analyst-in-Charge), Arushi Kumar, Kimberly  Lloyd Perrault, Jennifer Rudisill, and Emily J. Weisenberger made key  contributions to this report. Also contributing were Drew Long and Ethiene  Salgado-Rodriguez.

Medicaid: Additional CMS Data and Oversight Needed to Help Ensure  Children Receive Recommended Screenings. GAO-19-481. Washington,  D.C.: August 16, 2019.

Opioid Crisis: Status of Public Health Emergency Authorities. GAO-18- 685R. Washington, D.C.: September 28, 2018.

Adolescent and Young Adult Substance Use: Federal Grants for  Prevention, Treatment, and Recovery Services and for Research. GAO- 18-606. Washington, D.C.: September 4, 2018.

Newborn Health: Federal Action Needed to Address Neonatal Abstinence  Syndrome. GAO-18-32. Washington, D.C.: October 4, 2017.

Drug Control Policy: Information on Status of Federal Efforts and Key  Issues for Preventing Illicit Drug Use. GAO-17-766T. Washington, D.C.:  July 26, 2017.

Medicaid Expansion: Behavioral Health Treatment Use in Selected States  in 2014. GAO-17-529. Washington, D.C.: June 22, 2017.

Health Care: Telehealth and Remote Patient Monitoring Use in Medicare  and Selected Federal Programs. GAO-17-365. Washington, D.C.: April  14, 2017.

School Based Health Centers: Available Information on Federal Funding.  GAO-11-18R. Washington, D.C.: October 8, 2010.

Opioids were the main driver of the more than 70,000 U.S. drug overdose deaths in 2017.

Congress and others have asked about Medicaid coverage of opioid addiction treatments for low-income pregnant and postpartum women. We looked at treatment services (e.g., outpatient therapy) that Medicaid can cover. The 6 states we reviewed generally covered most of them.

Questions have also been raised over Medicaid’s coverage of opioid screening and treatment for children. Nationwide, 31 states covered school telehealth services for opioid addiction, such as counseling via videoconference. As far as we could tell, these services haven’t been used.