DEPARTMENT OF HEALTH & HUMAN SERVICES 
Centers for Medicare & Medicaid Services   
7500 Security Boulevard, Mail Stop S2-26-12 
Baltimore, Maryland   21244-1850 
SMD # 18--011 
RE: Opportunities to Design 
Innovative Service Delivery 
Systems for Adults with a 
Serious Mental Illness or 
Children with a Serious 
Emotional Disturbance 
November 13, 2018 
Dear State Medicaid Director: 
The purpose of this letter is to announce opportunities to design innovative service delivery systems, 
including systems for providing community-based services, for adults with a serious mental illness 
(SMI) or children with a serious emotional disturbance (SED) who are receiving medical assistance, 
as mandated by section 12003 of the 21st Century Cures Act (Cures Act).i  Section 12003 of the 
Cures Act also mandated that this State Medicaid Director (SMD) letter include opportunities for 
demonstration projects under section 1115(a) of the Social Security Act (the Act) to improve care for 
adults with SMI or children with SED (referred to throughout this SMD letter as this SMI/SED 
demonstration opportunity).  Improving care for beneficiaries with SMI or SED is a top priority for 
the Centers for Medicare & Medicaid Services (CMS).  With this SMD letter, CMS hopes to enhance 
our work with states to improve care for Medicaid beneficiaries with serious mental health 
conditions.  This SMD letter is comprised of the following two parts:  
I. Strategies under Existing Authorities to Support Innovative Service Delivery Systems
for Adults with SMI and Children with SED; and
II. SMI/SED Demonstration Opportunity.
Background 
The Substance Abuse and Mental Health Services Administration (SAMHSA) has defined adults 
with a serious mental illness as persons, age 18 and over, who currently, or at any time during the 
past year, have had a diagnosable mental, behavioral, or emotional disorder of sufficient duration to 
meet diagnostic criteria, that has resulted in functional impairment which substantially interferes with 
or limits one or more major life activities.ii  Major life activities include activities of daily living (e.g., 
eating, bathing, dressing), instrumental activities of daily living (e.g., maintaining a household, 
managing money, getting around the community, taking prescribed medication), and functioning in 
social, family, and vocational/educational contexts.iii  An estimated 10.4 million adults in the United 
States had an SMI during the past year in 2016, but only 65 percent received mental health services in 
that year (and this rate of treatment remained about the same between 2008 and 2015).iv   Page 2 State Medicaid Director 
 
SAMHSA has defined children with a serious emotional disturbance as persons from birth up to 
age 18, who currently, or at any time during the past year, have had a diagnosable mental, behavioral, 
or emotional disorder of sufficient duration to meet diagnostic criteria that resulted in functional 
impairment which substantially interferes with or limits the childs role or functioning in family, 
school, or community activities.v  Functional impairment is defined as difficulties that substantially 
interfere with or limit a child or adolescent from achieving or maintaining one or more 
developmentally-appropriate social, behavioral, cognitive, communicative, or adaptive skills.vi 
 
Mental health disorders usually first arise in childhood, adolescence, or early adulthood with 50% of 
people with mental health conditions having experienced those conditions by age 14 and 75% by age 
24.vii  Approximately 13%20% of children and adolescents living in the United States experience a 
mental disorder in a given yearviii and nearly half of children under age 21 who qualify for Medicaid 
based on a disability have a behavioral health condition.ix  Rates of unmet need for treatment are high 
among children and adolescents; only about half of all children with emotional or behavioral 
difficulties receive mental health services,x and only 41 percent of the 3.1 million adolescents who 
experienced depression over the past year in 2016 received treatment.xi      
 
Serious mental health conditions can have detrimental impacts on the lives of individuals with SMI or 
SED and their families and caregivers.  Since these conditions often arise in adolescence or early 
adulthood, individuals with SMI or SED are less likely to finish high school and attain higher 
education, disrupting education and employment goals.xii  Prior research has found a gap of ten years 
or more between the first onset of symptoms and initiation of treatment.xiii  Adults with SMI 
comprise about half of the individuals under 65 who are dually eligible for both Medicare and 
Medicaid, and those with SMI are the costliest subgroup among these younger dual eligibles.xiv  
Furthermore, adults who are incarcerated and homeless have high rates of SMI.xv  Individuals with 
SMI often have co-morbid physical health conditions and substance use disorders (SUDs),xvi and they 
die on average 8 years younger than the general population.xvii  Suicide, which can be associated with 
mental health disorders,xviii has been increasing in nearly every state, with increases of over 30% in 
over half of the states since 1999.xix   
 
I.  Strategies under Existing Authorities to Support Innovative Service Delivery Systems for 
Adults with SMI and Children with SED 
 
Earlier Identification and Engagement in Treatment 
 
Critical strategies for improving care for individuals with SMI or SED include earlier identification 
of serious mental health conditions and focused efforts to engage individuals with these conditions in 
treatment sooner, as highlighted in another recent CMS SMD letter.xx  Some approaches discussed 
below for encouraging earlier identification of and engagement in treatment for serious mental health 
conditions include support for development of referral networks to mental health providers including 
through improved connections and data-sharing capabilities linking non-specialized health care 
settings and community organizations with mental health providers.  Another approach to support 
earlier identification and engagement in treatment is support for increased screening for mental health 
conditions and improved access to mental health services through schools. 
  Page 3 State Medicaid Director 
 
One reason that earlier identification and engagement in treatment is critically important is that recent 
research studies have found that adolescents and young adults with psychosis can have significantly 
elevated risks of mortality in the first year after diagnosis.xxi  One study pointed to a significantly 
elevated risk of suicide in particular during the first year after a diagnosis of psychosis as well as 
following a first recorded diagnosis of major depression.xxii  Both studies concluded that these 
findings point to the importance of assertive outreach and engagement as soon as possible after an 
adolescent or young adult is first diagnosed with a serious mental health condition.   
 
As highlighted in an informational bulletin jointly issued by CMS, SAMHSA, and the National 
Institute of Mental Health, the Coordinated Specialty Care Model is an evidence-based model of care 
designed to help identify and engage adolescents and adults with SMI, specifically psychosis, as soon 
as possible in treatment with specialized mental health providers, e.g., community mental health 
clinics.xxiii  This model takes a multidisciplinary, team-based approach to providing comprehensive 
services as soon as possible after a person first experiences psychosis.  The package of services in 
this model includes outreach by providers to cultivate referral networks and engage with patients, 
families, and caregivers as early as possible, coordination of services among treatment team 
members, clinical supervision, medication and medication management, psychotherapy, case 
management, coordination with primary care, family/caregiver support and education, and supported 
employment and supported education.  The Joint Informational Bulletin referenced above describes 
the component services that make up this model and how these components can be reimbursed.xxiv  
There are also similar care models for children at clinically high risk for SED and adolescents and 
young adults at high risk of SMI that incorporate comprehensive mental health care, family 
education, medical care, and strong supports to keep children, adolescents, and adults engaged in 
school and/or employment.xxv   
 
Lack of coverage of the costs of outreach to engage beneficiaries in treatment and develop referral 
networks has been identified by providers and advocates as an impediment to broader implementation 
of these care models.  However, states may be able to factor costs of some outreach activities, 
including patient engagement related to delivering a Medicaid covered service, into provider payment 
rates even though those activities are generally not separately reimbursable unless specified under a 
service definition.  Activities by providers to engage beneficiaries in treatment including by 
developing relationships with hospitals to improve coordination and transitions out of inpatient care 
may be more specifically coverable under the optional Health Home state plan benefit under section 
1945 of the Act.  This optional state plan benefit includes care coordination, transition care, or 
individual and family support services and is discussed in more detail in Appendix A. 
 
Individuals with SMI or SED are often first identified as needing treatment for SMI or SED in 
settings other than specialized mental health care settings including schools, hospitals, primary care, 
and criminal justice systems.  Connecting these other settings with local mental health providers can 
help improve access to treatment and rehabilitative services as soon as possible after a serious mental 
health condition has been identified.  Medicaid agency costs associated with developing or 
maintaining a referral network between other systems and settings like those listed above with mental 
health providers may be reimbursable as administrative costs.  State Medicaid agencies should 
contact CMS for additional information. 
  Page 4 State Medicaid Director 
 
Improving data-sharing capabilities between schools, hospitals, primary care, criminal justice, and 
specialized mental health providers is an effective way to improve communications between these 
types of entities and the healthcare system.  States may be able to access enhanced federal Medicaid 
matching funds for costs to state Medicaid agencies of implementing and operating technology to 
improve data-sharing capabilities as part of the Medicaid Information Technology Architecture 
(MITA).xxvi  Many of the business processes described in MITA 3.0 regarding Care Management 
focus specifically on systems supporting the collection of information about an individuals health 
status and needs.  States could use this authority and enhanced match to develop connections between 
mental health care providers and schools, hospitals, primary care, criminal justice, and faith 
communities, consistent with the discussion of Interoperability contained in the final rule on this 
topic.xxvii  For example, enhanced federal financial participation (FFP) could be available to states for 
the development by the state of data-sharing capabilities between hospitals and community-based 
mental health providers such that when a beneficiary with SMI or SED is being discharged from a 
hospital, that beneficiarys records regarding treatment could more easily be transferred to a 
community-based treatment provider or, if the beneficiary was being admitted to a hospital for acute 
care, the community-based mental health provider could be notified more easily.   
 
The U.S. Department of Health and Human Services (HHS) Office for Civil Rights (OCR) has 
published comprehensive guidance for professionalsxxviii and health care consumersxxix explaining the 
circumstances in which health care providers covered by the Health Insurance Portability and 
Accountability Act (HIPAA) can share information related to mental health.  The HHS OCR 
guidance, required by section 11003 of the 21st Century Cures Act, clarifies how the HIPAA Privacy 
Rule permits covered health care providers and other mental health treatment professionals to 
disclose information to a patients family members, caregivers, and others to facilitate treatment and 
protect the health and safety of patients with SMI and SED and others.  
 
Furthermore, improving the availability of behavioral health screenings and mental health and SUD 
services in schools is a key strategy for identifying and engaging children with SED in care sooner.  
Providing behavioral health services in school settings has been shown to improve access to care,xxx 
increase early problem identification,xxxi and overcome reticence to access care by providing services 
in a more mainstream and accessible setting.xxxii  States interested in making school-based mental 
health screening and behavioral health counseling more widely available could do so under the Early 
and Periodic Screening, Diagnostic, and Treatment (EPSDT) benefit.    
 
The EPSDT benefit provides a comprehensive array of prevention, diagnostic, and treatment services 
for Medicaid-enrolled children under age 21 as specified in section 1905(r) of the Act.  The EPSDT 
benefit requires states to have a schedule for screening services both at established times and on an 
as-needed basis.  Covered screenings for children include medical, mental health, vision, hearing, and 
dental.  Incorporating an age appropriate, evidence-based screening tool designed to identify 
behavioral health conditions into well-child examinations is an important step to identify mental 
health and SUD conditions early.  In addition, the EPSDT benefit requires that states provide all 
medically necessary services covered under the benefits in section 1905(a) of the Act to correct or 
ameliorate physical and mental illnesses or conditions.  Behavioral health counseling could be 
covered under the rehabilitative services benefit at section 1905(a)(13) of the Act, but states would 
not need to amend their state plans to add EPSDT coverage for screening and behavioral health  Page 5 State Medicaid Director 
 
services.  However, some states choose to do so in order to clarify the services covered in the school 
setting.   
 
All providers of Medicaid services in schools must be qualified and enrolled as Medicaid providers.  
The Department of Health and Human Services and the Department of Education jointly issued a 
toolkit outlining action steps and practices that states and local communities can take to improve 
availability of school-based health services and supports that are critical for children with or at risk of 
SED.xxxiii  Other approaches to improving access to mental health services in schools include 
developing partnerships with Federally Qualified Health Centers (FQHCs) and rural health 
clinics.xxxiv  In addition, states could also ensure that their managed care plans allow for 
reimbursement of school-based providers.   
 
Integration of Mental Health Care and Primary Care 
 
Integration of mental health care into primary care settings can also help ensure that individuals with 
SMI or SED are identified earlier and connected with appropriate treatment sooner.  In addition, 
integration is critical for improving access to treatment for comorbid physical health conditions and 
SUDs that are common among individuals with SMI or SED.  Some strategies for increasing 
integration of mental health care into primary care that are discussed below include encouraging 
screening for mental health disorders and supporting primary care providers (PCPs) and pediatricians 
to provide treatment and/or referrals for mental health services with the support of consultations with 
specialists and care coordinators. 
 
Outpatient provider visits offer critical opportunities to screen for mental health issues and suicidal 
ideation.  Research has found that 64 percent of individuals had visited a health care provider within 
a month prior to attempting suicide and 95 percent visited one within a year prior to attempting 
suicide.xxxv  The Patient Health Questionnaire (PHQ)-9 is a clinically validated assessment tool 
focused on screening for depression and measuring depression severity which includes screening for 
the presence of suicidal ideation.  States may wish to encourage providers participating in their 
Medicaid programs to screen for depression and suicidal ideation using the PHQ-9 during outpatient 
office visits. xxxvi 
 
One evidence-based approach to incorporating specialty mental health care into primary care settings, 
the Collaborative Care Model, has been proven effective in over 80 randomized controlled trials.xxxvii  
Although originally designed to treat depression, there is increasing evidence of its effectiveness for 
treating other behavioral health conditions including anxiety, post-traumatic stress disorder, and 
SUDs.  This care model uses a team-based approach in which PCPs treat mental health and SUD 
issues of their patients supported by a behavioral health care manager and a psychiatric 
consultant.  The behavioral health care manager is a social worker or psychologist who works with 
the PCP and is trained to deliver care coordination and brief behavioral interventions.  The 
psychiatric consultant is a psychiatrist or physician assistant, nurse practitioner, or clinical nurse 
specialist with psychiatric training who makes treatment recommendations to the PCP, including 
medication and evidence-based therapy recommendations and medical management of any 
complications associated with treatment.  Key components of the Collaborative Care Model include 
care coordination and care management by the care manager, regular patient monitoring using  Page 6 State Medicaid Director 
 
clinical rating scales, the use of evidence-based approaches and stepped care that intensifies and/or 
modifies the approach for complex or treatment resistant cases, and regular psychiatric caseload 
reviews in person or through use of telemedicine with a psychiatric consultant.   
 
A less intensive model for children with mental health conditions is the Child Psychiatry Access 
Model supported by the National Network of Child Psychiatry Access Programs.xxxviii  These 
programs generally offer telephonic consultation with a psychiatrist or other licensed behavioral 
health clinician, face-to-face psychiatric or behavioral health consultations for patients when needed, 
with a written summary provided to the PCP, and assistance with referral to community-based 
behavioral health services.  For example, the Massachusetts Child Psychiatry Access Project Model, 
established in 2004, offers statewide access to over 95 percent of pediatric primary care providers in 
the state through six regional behavioral health consultation hubs.  Each hub includes a full-time 
child psychiatrist, licensed therapist, and a care coordinator.  Each hub operates a dedicated hotline 
and offers immediate clinical consultation over the telephone, expedited face-to-face psychiatric 
consultation, care coordination for assistance with referrals to community behavioral health services, 
and continuing professional education for primary care providers.  Participating pediatricians have 
reported a significant improvement in their ability to meet the mental health care needs of their 
patients (although a considerable gap remains): the percent of participating pediatricians who 
responded to an annual survey and said they could meet the needs of children with behavioral health 
problems increased from eight percent in 2008 to 64 percent in 2012.xxxix  
 
One issue that has been identified by a number of stakeholders as impeding broader implementation 
of these models is a lack of reimbursement for consultation and care coordination outside the 
presence of the patient.   Although the presence of the patient is required for the service to be 
covered, Medicaid may be able to reimburse for consultations between professionals regarding 
treatment for a patient and for care coordination if these costs are incorporated into the rate a state 
pays a provider for a covered service for a beneficiary.  Under such circumstances, the resources that 
go into that encounter (such as a consultation with a specialist regarding treatment options for that 
beneficiary) can be accounted for in the rate for that service.  The provider receiving the 
reimbursement would then have to reimburse the specialty provider.  Furthermore, Medicare covers 
payments to practitioners for behavioral health integration services, including the Collaborative Care 
Model, and has identified Current Procedural Technology (CPT) codes for these payments, which 
may be useful for states interested in supporting this model of care.xl  States are also encouraged to 
eliminate restrictions on same-day billing for primary care and mental health services in order to 
facilitate implementation of these types of models. 
 
Use of telehealth technologies to support provision of the Collaborative Care model is another 
important strategy for facilitating broader availability of integrated mental health care and primary 
care. xli   States may be able to access enhanced match under MITA 3.0xlii for state development of 
telehealth-enabling technology to be used by Medicaid providers to coordinate care for beneficiaries.  
Some examples include development of virtual treatment centers or remote counseling options 
integrated into care coordination technology consistent with the Managing Care Information 
business process under MITA 3.0 which includes activities connecting providers to patients and 
facilitating access to services.xliii  For supporting state costs associated with implementing the 
Collaborative Care model or other team-based approaches, states could also consider using the  Page 7 State Medicaid Director 
 
existing authority for Care Plan Exchange under MITA 3.0.xliv  The treatment services themselves 
that are provided via tele-health technology could be covered using state plan or other Medicaid 
authorities. 
 
Similarly, the Health Home benefit under section 1945 of the Act could also be used to support this 
model of care.  The Health Home benefit offers 90 percent FFP for eight quarters for specific services 
including comprehensive care management, care coordination, comprehensive transition care, 
individual and family support, and the use of health information technology to link services.   
 
Improved Access to Services Across the Continuum of Care Including Crisis Stabilization Services 
 
Adults with SMI and children with SED need access to a continuum of care since these conditions are 
often episodic and the severity of symptoms can vary over time.xlv  However, the only treatment 
options in many regions are inpatient care for acute treatment needs and outpatient care for less 
serious conditions and on-going maintenance therapy, with little availability of intermediate levels of 
care.xlvi  As a result, individuals with serious mental health conditions often go into inpatient 
facilities or emergency departments when they could be better served in community-based settings.  
Furthermore, without the supports needed to help transition from acute care back into their 
communities, adults with SMI are at heightened risk for relapse and readmission.xlvii  Mental health 
disorders are often the primary cause of hospital readmissions among adult Medicaid 
beneficiaries,xlviii indicating a need for more evidence-based community-based supports and services.   
 
Strategies for ensuring individuals with SMI or SED are provided appropriate levels of care to meet 
their needs include encouraging use of evidence-based assessment tools, e.g. the LOCUS and CASII 
(or CALOCUS), that link clinical assessments with standardized "levels of care" using methods for 
matching the two.xlix   It is also important that the care provided to individuals with SMI or SED is 
trauma-informed.l   
 
Another strategy is to increase availability of intensive outpatient and crisis stabilization programs 
designed to divert Medicaid beneficiaries from unnecessary stays in emergency departments (EDs) 
and inpatient facilities as well as criminal justice involvement.li  Core elements of crisis stabilization 
programs include regional or statewide crisis call centers coordinating access to care in real time, 
centrally deployed mobile crisis units available 24 hours a day and seven days a week, and short-
term, sub-acute residential crisis stabilization programs.lii   
 
Depending on the circumstances, services provided to beneficiaries in residential settings may be 
subject to the payment exclusion for institutions for mental diseases (IMDs).liii  Section 1905(i) of the 
Act defines an IMD as any hospital, nursing facility, or other institution of more than 16 beds, that is 
primarily engaged in providing diagnosis, treatment, or care of persons with mental diseases, 
including medical attention, nursing care, and related services.liv  There is some authority for states 
to receive FFP for monthly capitation payments paid to Medicaid managed care plans for coverage of 
Medicaid beneficiaries residing in IMDs; Medicaid managed care rules permit FFP for monthly 
capitation payments to managed care plans for enrollees that are inpatients in a hospital providing 
psychiatric or SUD inpatient care or in a sub-acute psychiatric or SUD crisis residential setting that  Page 8 State Medicaid Director 
 
may qualify as IMDs when the stay is for no more than 15 days during the period of the monthly 
capitation payment and certain other conditions are met.lv  
 
Furthermore, states may be able to access administrative match for crisis call centers as some states 
have done for tobacco quit lines.lvi  However, in order to access administrative match for crisis call 
centers, a state would have to justify in a reasonable manner how many callers are Medicaid 
beneficiaries in order to properly allocate costs to Medicaid.   States can refer to guidance on tobacco 
quit lines.lvii  Enhanced administrative match may be available under MITA 3.0 to help states 
establish crisis call centers to connect beneficiaries with mental health treatment as well as to develop 
technologies to link mobile crisis units to beneficiaries coping with serious mental health conditions.  
 
States may also coordinate access to outreach, referral, and assessment services for behavioral health 
care through an established No Wrong Door System.lviii The No Wrong Door System is a 
collaboration between CMS, the U.S. Administration for Community Living, and the Veterans Health 
Administration to support states efforts to develop coordinated systems of access to make it easier 
for consumers to learn about and access Long-Term Service and Supports.  
 
The Certified Community Behavioral Health Clinic (CCBHC) demonstration lix offers a model for 
providing comprehensive community-based behavioral health care.  Certification criteria for 
CCBHCs under the demonstration include the availability of 24-hour crisis care, utilization of 
evidence-based practices, care coordination, and integration of mental health, SUD, and physical 
health care.lx  To promote improved quality of care, CCBHCs are required to report on a range of 
quality measures.  States may be able to adapt the CCBHC model of care using different authorities, 
depending on the services provided, beneficiaries served, and payment methodologies.  For example, 
some CCBHC services may be authorized under the state plan and covered as clinic services with 
payment made using an encounter rate that pays for a bundle of behavioral health and primary care 
services.  States may also elect to use incentive payments (as is being done in the CCBHC 
demonstration) to encourage providers to implement the comprehensive model of care delineated for 
the CCBHC demonstration.lxi    
 
Another strategy for helping adults with SMI or children with SED access appropriate levels of care 
is development of the capability to track which mental health providers are accepting Medicaid 
beneficiaries at different levels of care throughout the state, including outpatient, intensive outpatient, 
inpatient, and community-based crisis services.  Development by the state of this capability to track 
available mental health providers, such as through a type of registry reflecting qualified providers that 
is frequently updated, could be reimbursed under MITA 3.0 at 90% of the development costs and 
75% of the operational costs.lxii  Furthermore, Medicaid managed care plans (managed care 
organizations, prepaid inpatient health plans, prepaid ambulatory health plans, and, where applicable, 
primary care case management plans) must identify as part of provider directories whether a network 
provider is accepting new patients under 42 C.F.R.  438.10(h)(1)(vi). 
 
Additional opportunities to engage Medicaid beneficiaries in community-based treatment include 
increasing availability of assertive community treatment (ACT) programs.lxiii  ACT programs include 
a multidisciplinary team of mental health professionals with low client to staff ratios allowing for 
multiple contacts for clients needing intensive support and the capacity to respond 24 hours a day  Page 9 State Medicaid Director 
 
seven days a week.  ACT programs include frequent team meetings and offer integration of services 
instead of referring clients to other programs for other services.  CMS has previously issued a State 
Medicaid Director letter that included information about covering ACT programs in Medicaid.lxiv  
Coverable services in ACT programs could include assessment, medication, medication management, 
therapy/counseling, and case management.   
 
Many Medicaid beneficiaries with SMI or SED need skilled, person-centered planning, services, and 
supports that address their cultural needs and values and help them access services across a 
continuum of care as needed.  This type of planning identifies and addresses the persons preferences 
and interests and those paid and unpaid supports needed to achieve them.  The planning and services 
can be directed with the support of others whom the beneficiary selects. Those responsible for 
person-centered practices should be engaged in a continuous learning and improvement process.   
 
HHS policy on person-centered thinking, planning, and practice is articulated in statute, regulations, 
guidance documents, prior grant and contract actions, and numerous HHS-sponsored presentations 
(see e.g., CMS January 2014 HCBS final rulelxv and HHS Guidance for Implementing Standards for 
Person Centered Planning and Self-Direction issued in June 2014lxvi).  These expectations apply to 
1915(c) waivers, and the 1915(i) and 1915(k) state plan options.  In addition, the 2014 Guidance 
applies to all HHS programs serving people with disabilities and older adults including several 
programs that serve people with SMI and SED, e.g., the Administration for Community Living No 
Wrong Door program, the SAMHSA CCBHC program, and the SAMHSA Mental Health Block 
Grant Program.  The Medicaid Health Home state plan option also requires person-centered planning 
and the Office of the National Coordinator (ONC) eLTSS data elements provide an electronic 
mechanism to track key components of the person-centered service plan as part of a comprehensive 
health IT strategy.  Furthermore, psychiatric advance directives and individual participation in 
treatment and recovery services planning are important components of person-centered planning for 
people with SMI and SED.   
 
There is a strong role for peers as natural allies in the facilitation of person-centered planning 
processes, and self-direction for mental health is an emerging practice that is being developed in 
several states and shows promising outcomes.lxvii  Innovative models of community recovery support, 
such as clubhouse programs and wrap-around recovery support services provided by community 
health workers, emphasize the use of peer support specialists and others to provide skills training, and 
assistance with educational and vocational needs.  CMS has previously issued a State Medicaid 
Director letter on covering peer support services in Medicaid,lxviii as well as additional clarification 
that peer supports in some circumstances can include peer supports for the parents/legal guardians of 
Medicaid eligible children.lxix 
 
Better Care Coordination and Transitions to Community-based Care  
 
Improving coordination of care between levels of care and particularly as individuals with SMI or 
SED leave inpatient or residential treatment is a critical issue that states should address in order to 
improve outcomes for beneficiaries with these conditions.  The risk of suicide following discharge 
from psychiatric hospitals or wards is greatest immediately following an inpatient stay, with the rate 
of suicide during the first three months after discharge approximately 100 times higher than the  Page 10 State Medicaid Director 
 
global suicide rate according to a 2017 systematic review and meta-analysis.lxx  This study highlights 
how important it is for individuals with SMI or SED to receive timely follow-up care after leaving 
residential or inpatient treatment.   
 
Unfortunately, many Medicaid beneficiaries do not receive timely follow-up care within the 
timeframes of 7 or 30 days that are used to measure timely follow-up care in the widely used measure 
Follow-up After Hospitalization for Mental Illness (NQF #0576).  This measure is included in both 
the core set of health care quality measures for adults enrolled in Medicaid (Adult Core Set) and the 
core set of childrens health care quality measures for Medicaid and the Childrens Health Insurance 
Program (CHIP) (Child Core Set).  According to Medicaid data submitted by the thirty-six states that 
reported the follow-up after hospitalization measure in fiscal year (FY) 2016 (the latest data 
available), a median of only 38 percent of adult beneficiaries (ages 21 and older) who were 
hospitalized for mental illness had a follow-up visit within 7 days of discharge and only 60 percent 
had a follow-up visit within 30 days of discharge.lxxi  A median of 45 percent of children (ages 6 to 
20) who were hospitalized for mental illness had a follow-up visit within 7 days of discharge and 
only 68 percent had a follow-up visit within 30 days of discharge for FY 2016 for the forty-one states 
who reported.lxxii   
 
One approach to improve care coordination following hospitalization is to implement accountability 
measures and payment incentives for plans and providers.  A model for this approach is the Medicare 
Hospital Readmission Reduction Program, which financially penalizes hospitals with relatively high 
rates of Medicare readmissions for specific conditions.lxxiii  Medicaid managed care plans can also be 
held accountable for performance on the widely used measures assessing follow-up after 
hospitalization (discussed above) and follow-up after emergency room care for mental illness (both of 
which are included in both the Adult lxxiv and Child Core Setslxxv).  States can add these requirements 
to their contracts with managed care plans either through inclusion in a plans quality assessment and 
performance improvement (QAPI) program or through a plan or provider incentive arrangement.  
 
Ensuring that hospitals and residential treatment settings contact discharged individuals with SMI or 
SED within a few days of leaving inpatient or residential care can help improve outcomes as can 
connecting those individuals with community-based care.  One recent study found that follow-up via 
mailed postcards, follow-up via telephone outreach, and suicide-focused cognitive behavioral therapy 
could each be highly effective, relative to usual care alone, at reducing suicides and attempted 
suicides for which there is a heightened risk following inpatient care.lxxvi  These interventions were 
also expected to be relatively cost-effective as compared to the usual cost of care.lxxvii  There is not a 
Medicaid benefit category that specifically authorizes coverage of contacts by hospital/residential 
treatment program staff via mail or phone calls following inpatient care or emergency room visits; 
however, the cost of providing these kinds of follow-up contacts to Medicaid beneficiaries could be 
included in the rates that states set for inpatient and emergency room services.  Cognitive behavioral 
therapy can be covered using the rehabilitative services benefit.   
 
Peer support providers can help make connections between inpatient facilities and emergency 
departments and outpatient treatment providers.lxxviii   In addition, peer navigators, one-to-one support 
in group homes, and providing staff to accompany an adult with SMI when they attend medical and 
social services can also help prevent hospitalization of adults with SMI.  Page 11 State Medicaid Director 
 
 
The optional Health Home benefit can also support improved care coordination following an 
inpatient stay.  As discussed above, Health Home services include comprehensive transitional care 
from inpatient to other settings including appropriate follow-up care.  Currently, 18 out of 22 states 
with approved Health Home programs have identified beneficiaries with a mental health condition as 
a target population for the Health Home benefits 
 
Increased Access to Evidence-based Services that Address Social Risk Factors  
 
Supportive services designed to help individuals with SMI or SED maintain a job or stay in school 
are often identified as crucial for keeping these individuals healthy and on the path to recovery.  
These types of services can offer key incentives for individuals with serious mental health conditions, 
particularly adolescents and young adults, to enter and remain engaged in treatment programs.lxxix  In 
addition, helping adults with SMI maintain stable housing has been identified as a critical foundation 
for improving health outcomes.lxxx  However, only 2 percent of adults and transition-age youth with 
SMI received supported employment in 2016 (according to data from 43 states) and only three 
percent received supportive housing in 2016 (according to data from 35 states).lxxxi   
 
Improving access to these supportive services, including supported education, which is a variation on 
supported employment, is a critical strategy for improving outcomes for Medicaid beneficiaries with 
SMI or SED.  States can use existing Medicaid authorities, including 1915(c) Home and Community-
Based Waivers and 1915(i) State Plan Amendments, to provide many of these supports.  Where 
Medicaid does not cover the supportive service itself, it generally covers services to connect 
beneficiaries to the necessary supports.   
 
States could also adopt, or expand eligibility for, Medicaid buy in programs to allow working 
individuals with disabilities whose income and/or assets exceed limits for other eligibility pathways 
to buy-in to Medicaid coverage.lxxxii  Medicaid buy-in programs could help eligible individuals 
with SMI or SED obtain and maintain employment by helping them avoid having to choose between 
healthcare coverage and work. lxxxiii   
 
A summary of the key components of the models of care and activities highlighted above along with 
Medicaid authorities that states may be able to use to implement these strategies and additional 
information on the specific Medicaid authorities are provided in Appendix A.  However, which 
services are coverable by Medicaid would depend on the Medicaid authority the states seek to use, 
and states should work with CMS on specific proposals to ensure they are feasible within Medicaid 
authority.   
 
II. SMI/SED Demonstration Opportunity 
 
As required by section 12003 of the Cures Act, CMS is announcing opportunities for demonstration 
projects under section 1115(a) of the Act to improve care for adults with SMI and children with SED 
(referred to as this SMI/SED demonstration opportunity).  Under section 1115(a) of the Act, the 
Secretary of HHS (Secretary) or CMS, operating under the Secretarys delegated authority, may 
authorize a state to conduct experimental, pilot, or demonstration projects that, in the judgment of the  Page 12 State Medicaid Director 
 
Secretary, are likely to assist in promoting the objectives of title XIX of the Act.  This SMI/SED 
demonstration opportunity will allow states, upon CMS approval of their demonstrations, to receive 
FFP for services furnished to Medicaid beneficiaries during short term stays for acute care in 
psychiatric hospitals or residential treatment settings that qualify as IMDs if those states are also 
taking action, through these demonstrations, to ensure good quality of care in IMDs and to improve 
access to community-based services as described below.  This SMI/SED demonstration opportunity 
is comparable to the recent section 1115(a) demonstration opportunity to improve treatment for 
SUDs, including opioid use disorder (OUD). lxxxiv  However, through these demonstrations, states will 
focus on demonstrating improved care for individuals with serious mental health conditions in 
inpatient or residential settings that qualify as IMDs as well as through improvements to community-
based mental health care. 
 
The payment exclusion for services provided to most Medicaid beneficiaries while residing in IMDs 
is often cited as a significant impediment to ensuring adequate access to acute care for beneficiaries 
with SMI or SED.  Some stakeholders assert that as a result of this payment exclusion, Medicaid 
beneficiaries with these conditions often present in emergency rooms where they are unlikely to 
receive adequate care and where they often must wait for hours and even days before space in an 
inpatient psychiatric facility becomes available.  Alternatively, beneficiaries may be admitted to a 
general hospital, but usually only for a very short period of time before being discharged, sometimes 
before being stabilized, and often without being connected to outpatient care.  In addition, some 
stakeholders assert that the lack of intensive community-based services and discharge planning 
linking people with community-based supports results in individuals not transitioning out of acute 
care facilities in a timely fashion, which further limits inpatient capacity to address the acute care 
needs of individuals with SMI or SED.  CMS is proposing to test these assertions. Furthermore, CMS 
believes that increasing access to mental health care, including acute treatment as well as community-
based services, could help address increasing suicide rateslxxxv since mental health disorders are often 
implicated in suicidal behavior.lxxxvi  
 
Through this demonstration opportunity, FFP would be available for services for beneficiaries who 
are short-term residents in IMDs primarily to receive mental health treatment.  While residing in 
those facilities primarily to receive mental health treatment, Medicaid beneficiaries should also be 
screened for co-occurring SUDs as well as physical health conditions.  States with approved 
demonstrations could also receive FFP for Medicaid coverable services provided to otherwise eligible 
beneficiaries to treat any co-occurring SUD and physical health conditions while those beneficiaries 
are residing short term in IMDs primarily to receive mental health treatment.   
 
States may participate in the SUD demonstration opportunity and this SMI/SED demonstration 
opportunity at the same time.  In the event that a state already has an approved SUD demonstration
or is seeking concurrent approval of an SUD and SMI/SED demonstrationCMS will provide 
technical assistance regarding how the two demonstration types may be operationalized.  Consistent 
with the SUD demonstration opportunity, states will be expected to achieve a statewide average 
length of stay of 30 days for beneficiaries receiving care in IMDs pursuant to this SMI/SED 
demonstration opportunity.  
  Page 13 State Medicaid Director 
 
Through this SMI/SED demonstration opportunity, states may receive federal matching funds for 
Medicaid-coverable services provided to individuals residing in psychiatric hospitals and residential 
treatment settings that are not ordinarily matchable because these facilities qualify as IMDs; however, 
this SMI/SED demonstration opportunity does not allow for room and board payments in residential 
treatment settings unless they qualify as inpatient facilities under section 1905(a) of the Act.  This 
limitation on covering room and board is a long-standing Medicaid policy based on statute and 
regulations.lxxxvii  Furthermore, FFP will not be available through these demonstrations for services 
provided in nursing homes that qualify as IMDs as CMS understands that nursing homes do not 
specialize in providing mental health treatment and may not have staff with appropriate credentials 
and training to provide good quality treatment to individuals with SMI or SED.  FFP also will not be 
available through these SMI/SED demonstrations for services provided in treatment settings for 
individuals 21 years of age or younger if those settings do not meet CMS requirements to qualify for 
the Inpatient Psychiatric Services for Individuals under Age 21 benefit.lxxxviii  In addition, FFP will 
not be available through these demonstrations for services in a psychiatric hospital or residential 
treatment facility for inmates who are involuntarily residing in the facility by operation of criminal 
law.lxxxix  States should contact CMS with any questions regarding these limitations.  
 
CMS will not approve a demonstration project under section 1115(a) of the Act unless the project is 
expected to be budget neutral to the federal government.xc  A budget neutral demonstration project 
does not result in Medicaid costs to the federal government that are greater than what the federal 
governments Medicaid costs would likely have been absent the demonstration.  What the federal 
governments Medicaid costs would likely have been absent the demonstration may include coverage 
of populations or services that the state could have otherwise provided through its Medicaid state plan 
or other title XIX authority, such as a waiver under section 1915 of the Act.  CMS considers these 
expenditures to be hypothetical; that is, the expenditures would have been eligible to receive FFP 
elsewhere in the Medicaid program.  For these hypothetical expenditures, CMS currently adjusts the 
budget neutrality test to effectively treat these expenditures as if they were approved Medicaid state 
plan services.  Hypothetical expenditures, therefore, do not necessitate savings to offset the otherwise 
allowable costs.  Nonetheless, with the approval of an SMI/SED demonstration, states will agree to 
report all title XIX expenditures, except spending under certain managed care arrangements, during 
SMI/SED-related IMD stays consistent with the Special Terms and Conditions (STCs) for the 
demonstration. 
 
States participating in the SMI/SED demonstration opportunity will also be expected to commit to 
taking a number of actions to improve community-based mental health care, as section 12003 of the 
Cures Act also directed CMS to address systems for providing community-based services for 
beneficiaries with SMI or SED.  These commitments to improving community-based care are to be 
linked to a set of goals for the SMI/SED demonstration opportunity described below and should 
include actions to ensure good quality of care in IMDs, to improve connections to community-based 
care following stays in acute care settings, to ensure a continuum of care is available to address more 
chronic, on-going mental health care needs of beneficiaries with SMI or SED, to provide a full array 
of crisis stabilization services, and to engage beneficiaries with SMI or SED in treatment as soon as 
possible.  These state actions should build on the opportunities for innovative service delivery 
reforms discussed in Part I of this letter to achieve the goals and milestones described below.    Page 14 State Medicaid Director 
 
CMS will consider a states commitment to on-going maintenance of effort on funding outpatient 
community-based mental health services as demonstrated in their application when determining 
whether to approve a states proposed demonstration project in order to ensure that resources are not 
disproportionately drawn into increasing access to treatment in inpatient and residential settings at the 
expense of community-based services.  Furthermore, CMS strongly encourages states to include in 
their application a thorough assessment of current availability of mental health services throughout 
the state, particularly crisis stabilization services.xci 
 
Similar to the SUD demonstration opportunity, this SMI/SED demonstration opportunity offers states 
the flexibility to design section 1115(a) demonstrations aimed at making significant improvements on 
a number of goals and milestones that are described below.   
 
Goals: 
 
  Reduced utilization and lengths of stay in EDs among Medicaid beneficiaries with SMI or 
SED while awaiting mental health treatment in specialized settings; 
 
  Reduced preventable readmissions to acute care hospitals and residential settings;  
 
  Improved availability of crisis stabilization services including services made available 
through call centers and mobile crisis units, intensive outpatient services, as well as services 
provided during acute short-term stays in residential crisis stabilization programs, psychiatric 
hospitals, and residential treatment settings throughout the state; 
 
  Improved access to community-based services to address the chronic mental health care needs 
of beneficiaries with SMI or SED including through increased integration of primary and 
behavioral health care; and 
 
  Improved care coordination, especially continuity of care in the community following 
episodes of acute care in hospitals and residential treatment facilities. 
 
Milestones: 
 
Ensuring Quality of Care in Psychiatric Hospitals and Residential Settings  
 
  Participating hospitals and residential settings are licensed or otherwise authorized by the 
state to primarily provide treatment for mental illnesses and are accredited by a nationally 
recognized accreditation entity including the Joint Commission or the Commission on 
Accreditation of Rehabilitation Facilities (CARF) prior to receiving FFP for services provided 
to beneficiaries; 
 
  Establishment of an oversight and auditing process that includes unannounced visits for 
ensuring participating psychiatric hospitals and residential treatment settings meet state 
licensure or certification requirements as well as a national accrediting entitys accreditation 
requirements;  Page 15 State Medicaid Director 
 
 
  Use of a utilization review entity (e.g., a managed care organization or administrative service 
organization) to ensure beneficiaries have access to the appropriate levels and types of care 
and to provide oversight to ensure lengths of stay are limited to what is medically necessary 
and only those who have a clinical need to receive treatment in psychiatric hospitals and 
residential treatment settings are receiving treatment in those facilities; 
 
  Participating psychiatric hospitals and residential treatment settings meet federal program 
integrity requirements, and  the state has a process for conducting risk-based screening of all 
newly enrolling providers, as well as revalidating existing providers (specifically, under 
existing regulations, states must screen all newly enrolling providers and reevaluate existing 
providers pursuant to the rules in 42 CFR Part 455 Subparts B and E, ensure treatment 
providers have entered into Medicaid provider agreements pursuant to 42 CFR 431.107, and 
establish rigorous program integrity protocols to safeguard against fraudulent billing and other 
compliance issues); 
 
  Implementation of a state requirement that participating psychiatric hospitals and residential 
treatment settings screen enrollees for co-morbid physical health conditions and SUDs and 
demonstrate the capacity to address co-morbid physical health conditions during short-term 
stays in these treatment settings (e.g., with on-site staff, telemedicine, and/or partnerships with 
local physical health providers); 
 
Improving Care Coordination and Transitions to Community-Based Care 
 
  Implementation of a process to ensure that psychiatric hospitals and residential treatment 
settings provide intensive pre-discharge, care coordination services to help transition 
beneficiaries out of these settings and into appropriate community-based outpatient services - 
as well as requirements that community-based providers participate in these transition efforts 
(e.g., by allowing initial services with a community-based provider while a beneficiary is still 
residing in these settings and/or by hiring peer support specialists to help beneficiaries make 
connections with available community-based providers, including, where applicable, plans for 
employment); 
 
  Implementation of a process to assess the housing situation of individuals transitioning to the 
community from psychiatric hospitals and residential treatment settings and connect those 
who are homeless or have unsuitable or unstable housing with community providers that 
coordinate housing services where available;  
 
  Implementation of a requirement that psychiatric hospitals and residential treatment settings 
have protocols in place to ensure contact is made by the treatment setting with each 
discharged beneficiary within 72 hours of discharge and to ensure follow-up care is accessed 
by individuals after leaving those facilities by contacting the individuals directly and by 
contacting the community-based provider the person was referred to; 
  Page 16 State Medicaid Director 
 
  Implementation of strategies to prevent or decrease the lengths of stay in EDs among 
beneficiaries with SMI or SED (e.g., through the use of peersxcii and psychiatric consultants in 
EDs to help with discharge and referral to treatment providers); 
 
  Implementation of strategies to develop and enhance interoperability and data sharing 
between physical, SUD, and mental health providers with the goal of enhancing care 
coordination so that disparate providers may better share clinical information to improve 
health outcomes for beneficiaries with SMI or SED; 
 
Increasing Access to Continuum of Care Including Crisis Stabilization Services 
 
  Annual assessments of the availability of mental health services throughout the state, 
particularly crisis stabilization services and updates on steps taken to increase availability; 
 
  Commitment to a financing plan approved by CMS to be implemented by the end of the 
demonstration to increase availability of non-hospital, non-residential crisis stabilization 
services, including services made available through crisis call centers, mobile crisis units, 
coordinated community crisis response that involves law enforcement and other first 
responders, and observation/assessment centers as well as on-going community-based 
services, e.g., intensive outpatient services, assertive community treatment, xciii and services in 
integrated care settings such as the Certified Community Behavioral Health Clinic model 
described in Part I of this letter as well as consideration of a self-direction option for 
beneficiaries; 
 
  Implementation of strategies to improve the states capacity to track the availability of 
inpatient and crisis stabilization beds to help connect individuals in need with that level of 
care as soon as possible;  
 
  Implementation of a requirement that providers, plans, and utilization review entities use an 
evidence-based, publicly available patient assessment tool, preferably endorsed by a mental 
health provider association, e.g., LOCUS or CASII,xciv to help determine appropriate level of 
care and length of stay; 
 
Earlier Identification and Engagement in Treatment Including Through Increased Integration 
 
  Implementation of strategies for identifying and engaging individuals, particularly adolescents 
and young adults, with serious mental health conditions, in treatment sooner including 
through supported employment and supported education programs; xcv 
 
  Increasing integration of behavioral health care in non-specialty care settings, including 
schools and primary care practices, to improve identification of serious mental health 
conditions sooner and improve awareness of and linkages to specialty treatment providers; 
and 
  Page 17 State Medicaid Director 
 
  Establishment of specialized settings and services, including crisis stabilization services, 
focused on the needs of young people experiencing SMI or SED.xcvi 
 
Demonstration Application    
 
States wishing to participate in this initiative can submit a demonstration application to CMS 
outlining the states strategy for achieving the goals of this demonstration opportunity, including a 
commitment to meeting the milestones described above that are critical steps for achieving these 
goals over the course of the demonstration.  CMS strongly encourages states to articulate in their 
demonstration applications how their proposals will apply evidence-based programs to meet the 
needs of people with SMI or SED in their states.  States applications should also describe the states 
capacity for regular reporting on progress toward meeting these milestones as well as for collecting 
and reporting data on performance measures.  In addition, states applications should confirm their 
commitment to assuring the necessary resources will be available to effectively support 
implementation of a robust monitoring protocol and evaluation. 
 
Implementation Plan 
 
Participating states will also develop implementation plans describing the various timelines and 
activities the states will undertake to achieve the milestones listed above.  States will have the option 
of submitting their implementation plans as part of their applications or as post approval protocols.  
Authorization of FFP for services in inpatient hospitals or residential treatment settings that qualify as 
IMDs will be contingent upon assurance by the state that all participating IMDs are licensed and 
accredited, community-based alternatives are or will be available throughout the state under the 
states financing plan described above, and CMS has approved the SMI/SED demonstrations 
implementation plan.  The expectation is that states will meet the milestones by the end of the first 
two years of the demonstration.  However, regardless of whether the implementation plan is 
submitted as part of a states application or as a post-approval protocol, FFP for services provided 
during Medicaid beneficiary stays in IMDs will be prospective only and contingent upon CMS 
approval of the states implementation plan. 
 
As a states SMI/SED demonstration progresses, the state will be expected to include, in its section 
1115(a) demonstration monitoring reports, information detailing the states progress toward meeting 
the milestones and timeframes specified in the states implementation plan, as well as information 
and data so that CMS can monitor budget neutrality.  
 
States seeking approval of an SMI/SED demonstration also will be expected to submit a Health IT 
Plan (HIT Plan) that describes the states ability to leverage health IT, advance health information 
exchange(s), and ensure health IT interoperability in support of the demonstrations goals.  The HIT 
Plan should address electronic care plan sharing, care coordination, and behavioral health-physical 
health integration.  CMS will provide additional guidance on these expectations. 
 
Monitoring Protocol for Performance Measures Aligned with Initiative Goals 
  Page 18 State Medicaid Director 
 
As outlined above, states will include in their section 1115(a) demonstration reports, information 
detailing milestones and performance measures representing key indicators of progress toward 
meeting the goals for this initiative.  Participating states will report on a common set of measures and 
the states and CMS will agree to additional measures and measure concepts specific to a particular 
states demonstration parameters.  A list of potential measures is included in Appendix B.  Reporting 
templates are subject to OMB review and approval under the Paperwork Reduction Act.   
 
CMS will provide guidance to participating states on development of monitoring protocols that will 
identify expectations for quarterly and annual monitoring reports, including agreed upon performance 
measures, measure concepts, and qualitative narrative summaries.  For performance measures, CMS 
guidance will include recommendations for baselines and targets.  Both quantitative and qualitative 
information will align with the milestones outlined above.  Any deviations from CMS guidance the 
state wishes to make will be documented in the monitoring protocol.  The monitoring protocol will be 
developed after CMS approval of the demonstration in consultation with CMS, and a timeframe for 
finalizing the monitoring protocol will be included in the STCs of each demonstration.   
 
The data reported by the state will inform a mid-point assessment between years two and three of the 
demonstration during which CMS will identify whether states are making sufficient progress toward 
meeting the milestones and performance measure targets.  The mid-point assessment will also include 
an assessment of whether a state is on track to meet the budget neutrality requirements.  States at risk 
of not meeting these targets will submit modifications to their implementation plans, which will be 
subject to CMS approval.  CMS may require a state to provide a corrective action plan if it fails to 
meet the required annual triggers indicating that waiver spending is diverging from the expected 
trajectory under the budget neutrality requirements.  Furthermore, FFP for services to individuals 
residing in IMDs may be withheld if states are not making adequate progress on meeting the 
milestones and goals as evidenced by reporting on the milestones and the required performance 
measures in the monitoring protocol agreed upon by the state and CMS.  Additionally, achievement 
of the milestones and performance measure targets will be taken into consideration by CMS if a state 
were to request an extension of its demonstration. 
 
States will also be required to conduct independent and robust interim and final evaluations that will 
draw on the data collected for the milestones and performance measures, as well as other data and 
information needed to support the evaluation that will describe the effectiveness and impact of the 
demonstration using quantitative and qualitative outcomes and a cost analysis.  An evaluation design 
will be developed by the state, with technical assistance from CMS, to be finalized within 180 days of 
the demonstration approval.  The evaluation design will include detailed analytic plans, data 
development, collection, and reporting details and will be subject to CMS approval. States that fail to 
submit an acceptable and timely evaluation design as well as any required monitoring, expenditure or 
other evaluation reporting, are subject to a $5 million deferral per deliverable.  The interim evaluation 
will be required one year before expiration of the demonstration or when the state submits a proposal 
to renew the demonstration.  The final evaluations will be due eighteen months after the 
demonstration period ends. 
 
Public Availability of Data on State Progress toward Meeting Milestones and Performance 
Measure Targets as well as Evaluation Reports   Page 19 State Medicaid Director 
 
 
CMS will regularly post information on the Medicaid.gov website regarding the states progress in 
meeting the agreed upon milestones and performance measure targets.  In addition, states regular 
1115 reports, as well as their evaluation reports, will be posted, as required by section 1115 
transparency rules. 
 
Submission Process for Section 1115(a) Demonstration 
 
States should follow the usual process for submitting section 1115(a) demonstration proposals as 
outlined in the federal section 1115(a) demonstration project transparency regulations at 42 CFR 
431.412 and 42 CFR 431.408.  As explained in these regulations, states should submit an application 
that includes the following information: 
 
 A comprehensive description of the demonstration, including the states strategies for 
addressing the goals and milestones discussed above for this demonstration initiative;  
 
 A comprehensive plan to address the needs of beneficiaries with SMI or SED, including an 
assessment of how this demonstration will complement and not supplant state activities called 
for or supported by other federal authorities and funding streams;  
 
 A description of the proposed health care delivery system, eligibility requirements, benefit 
coverage and cost sharing (premiums, copayments, and deductibles) required of individuals 
who will be impacted by the demonstration, to the extent such provisions would vary from the 
States current program features and the requirements of the Social Security Act;  
 
 A list of the waivers and expenditure authorities that the state believes to be necessary to 
authorize the demonstration;  
 
 An estimate of annual aggregate expenditures by population group impacted by the 
demonstration, including development of baseline cost data for these populations. 
Specifically, CMS requests that states fiscal analysis demonstrate how the proposed changes 
will be budget neutral, i.e., will not increase federal Medicaid spending. CMS will work 
closely with states to determine the feasibility of their budget neutrality models and suggest 
changes as necessary;  
 
 Enrollment data including historical mental health care coverage and projected coverage 
over the life of the demonstration, of each category of beneficiary whose health care coverage 
is impacted by the demonstration;  
 
 Written documentation of the states compliance with the public notice requirements at 42 
CFR 431.408, with a report of the issues raised by the public during the comment period and 
how the state considered those comments when developing the final demonstration 
application submitted to CMS;  
  Page 20 State Medicaid Director 
 
 The research hypotheses that are related to the demonstrations proposed changes, goals, and 
objectives, and a general plan for testing the hypotheses including, if feasible, the 
identification of appropriate evaluation indicators; and  
 
 An implementation Plan (if being submitted at the time of application).  
 
CMS requests that these Section 1115(a) demonstration proposals describe, in as much detail as 
possible, the states strategy for improving access to and quality of mental health care through the 
proposed demonstration and how the states proposed demonstration will further the goals of the 
initiative described above.  The application should include a description of the activities the state 
plans to undertake to address the milestones listed above and to report on progress toward meeting 
the milestone and performance measures.  If it is not feasible to include in the application a detailed 
implementation plan specifying how and when the state proposes to meet the milestones, the state 
should propose a date by which an implementation plan will be submitted by the state (generally 
within at least 90 days of approval of the application), and this date will be included in the STCs.  As 
a reminder, FFP for services in IMDs will not be available through the demonstration until the 
implementation plan/protocol is approved by CMS, at which time FFP will be available only 
prospectively.  In addition, the state should indicate what data sources and resources it proposes to 
use for reporting on performance measures. CMS will work with states to develop a detailed 
monitoring protocol for these data points and performance measures after the application is received 
from the state.  
 
After states develop 1115 demonstration proposals that include the information listed above, states 
must follow the minimum 30-day public notice and comment procedures outlined in 42 CFR 
431.408, to allow opportunity for public input on the application prior to submission to CMS. These 
procedures include consultation with Indian tribes and Indian health providers (to the extent there are 
Indian tribes and Indian health providers located within geographic boundaries of the state) to solicit 
advice from the Indian health providers on ensuring access for American Indian and Alaska Native 
(AI/AN) individuals to the services that are part of the demonstration and that these services meet the 
unique and cultural needs of AI/AN individuals.  
 
CMS is available to provide technical assistance to states on how to meet federal transparency 
requirements as well as to preview states draft 1115(a) proposals and public notice documentation to 
help ensure states successfully meet federal requirements.  
 
Section 1115(a) demonstration applications may be submitted electronically to 
1115DemoRequests@cms.hhs.gov or by mail to:  
 
Judith Cash  
Director, State Demonstrations Group  
Centers for Medicare & Medicaid Services  
Center for Medicaid & CHIP Services  
Mail Stop: S2-26-12  
7500 Security Boulevard  
Baltimore, MD 21244-1850   Page 21 State Medicaid Director 
As required by 42 CFR 431.416, when states submit section 1115 proposals, CMS will send written 
notice within 15 days of receipt to the state on whether its application meets all federal transparency 
requirements and is determined complete for purposes of initiating CMS' review and the federal 30-
day public notice and comment process.  
CMS is committed to supporting states that wish to implement innovative service delivery models for 
beneficiaries with SMI or SED including community-based services as mandated by section 12003 of 
the Cures Act.  Questions regarding this guidance may be directed to Kirsten Beronio, Senior 
Behavioral Health Policy Advisor, Disabled and Elderly Health Programs Group, at 
Kirsten.Beronio@cms.hhs.gov.  We look forward to continuing our work together on improving the 
health and wellness of Medicaid beneficiaries with SMI or SED.  
Sincerely, 
 /s/
Mary C. Mayhew 
Deputy Administrator and Director 
cc: 
National Association of Medicaid Directors 
National Academy for State Health Policy 
National Governors Association 
American Public Human Services Association 
Association of State and Territorial Health Officials 
Council of State Governments 
National Conference of State Legislatures  
Academy Health 
National Association of State Mental Health Program Directors  Page 22 State Medicaid Director 
 
Appendix A 
 
In the table below is a summary of some key services included in the models of care and activities 
highlighted in Part I of the letter above and summarized in the left column below, entitled Model, 
Benefit, or Activity.  The middle column below, entitled Potential Medicaid Authority, lists 
examples of Medicaid authorities that states may be able to use to cover the services and activities 
summarized in the left column next to the corresponding number.  In addition, the third column 
below, entitled Potential Payment Strategy lists payment strategies that could be used by states to 
support implementation of the model or activity summarized in the left column.  The services that can 
be eligible for FFP would depend on the specific authority that states seek to use, and states should 
submit specific proposals to CMS.   
 
Model, Benefit, or Activity  Potential Medicaid Authority   Potential Payment 
Strategy 
     
Coordinated Specialty Care Model and     
Similar Programs for High Risk     
Adolescentsxcvii     
1.  Provider outreach and early  1.  Provider costs for outreach and    Administrative match 
engagement and clinical  team supervision are not  may be available for 
supervision/coordination of team  directly coverable by Medicaid  state referral network 
members;  state plan authorities, but  development activities 
2.  Mental health services including  provider costs related to  that may be allocated to 
mental health assessment,  delivery of covered services  Medicaid;  
psychotherapy, medication  may be incorporated into rates    FFS payments for 
management, case management,  for covered services; 1945  covered Medicaid 
family supports, ACT programs,  Health Home state plan option;    service under 
and peer supports;  2.  1905(a) state plan benefits  appropriate benefit 
3.  Care coordination among team  including Rehabilitative  category; 
members and with primary care;  Services, Case Management,    Enhanced match under 
4.  Supported Employment/Education  Other Licensed Practitioner  the Health Home 
Services, Clinic Services;  benefit for 8 quarters; 
3.  1945 Health Home state plan    Payments through 
option; 
managed care 
4.  1915(i), 1915 (c), 1915(b)(3)   entitiesxcviii 
 
Improved data sharing between schools,     
hospitals, primary care, criminal justice,     
faith communities, and specialized     
mental health providers     
  Technology for screening &    MITA Architecturexcix    Enhanced 
assessment tools, analytics for  administrative match 
prevention and treatment, web or  approved via an 
application based tools for  advanced planning 
prevention and treatment.  document (APD) under 
MITAc 
School-based behavioral healthci       Page 23 State Medicaid Director 
 
  Screening and counseling and    1905(a) state plan benefits    Managed Care - Ensure 
referral to specialty care  such as  EPSDT, Other  providers in school 
Licensed Practitioner Services   settings are included in 
  Medicaid managed care 
networks or set up 
appropriate 
coordination; 
  FFS payments for 
covered Medicaid 
service under 
appropriate benefit 
category; 
  Partnerships with 
FQHCs 
Collaborative Care Model     
1.  Referral network development and  1.  Provider costs for outreach and    Administrative match 
team building;  team supervision are not  may be available for 
2.  Management of overall care by  directly coverable by Medicaid  state referral network 
primary care physician;  state plan authorities, but  development activities 
3.  Screening for mental health  provider costs related to  that may be allocated 
disorders and on-going monitoring  delivery of covered services  to Medicaid;  
of treatment adherence,  may be incorporated into rates    Payments through 
effectiveness, side effects usually by  for covered services, 1945  managed care 
care manager;  Health Home state plan option;    entities;xcix 
4.  Care coordination (including with  2.  1905(a) state plan benefits     FFS payments for 
outside specialty care and social  such as Physicians Services,  covered Medicaid 
services), patient engagement and  Clinic Services;  service under 
education, and brief  3.  1905(a) state plan benefits  appropriate benefit 
psychotherapeutic interventions by  such as Clinic Services, Other  category; 
care manager;  Licensed Practitioner Services;    Enhanced match for 
5.  Psychiatric specialist consultations  4.  1905(a) state plan benefits 
Health Homes services 
regarding patient progress including  such as Case Management 
for 8 quarters; 
recommendations for treatment  Services, Other Licensed    Enhanced 
strategies and adjustments;  Practitioner Services, 1945 
administrative match 
6.  Telehealth and other technology  Health Home state plan option; 
approved via an APD 
support  5.  Provider costs, including  under MITAci 
  consultation with specialists, 
may be able to be incorporated 
into rates for underlying 
covered services; 
6.  MITA Architecturec 
Child Psychiatry Access Model     
1.  Referral network development and  1.  Provider costs for outreach and    Administrative match 
infrastructure and technology  team supervision are not  may be available for 
support;  directly coverable by Medicaid  state referral network 
2.  Care coordination of behavioral  state plan authorities, but  development activities 
health treatment;  provider costs related to  that may be allocated 
3.  Consultation;  delivery of covered services  to Medicaid;  
4.  Mental health services  may be incorporated into rates  Page 24 State Medicaid Director 
 
for covered services, MITA    Enhanced 
Architecture;c  administrative match 
2.  1905(a) state plan benefits  approved via an APD 
such as Case Management  under MITA;ci  
Services, 1945 Health Home    Enhanced match for 
state plan option;  Health Home services 
3.  Provider costs, including  for 8 quarters; 
consultation with specialists,    FFS payments for 
may be able to be incorporated  covered Medicaid 
into rates for underlying  service under 
covered services;  appropriate benefit 
4.  1905(a) state plan benefits  category; 
such as Physicians Services,    Payments through 
Other Licensed Practitioner  managed care entitiesxcix 
Services 
 
Telehealth infrastructure as a delivery     
vehicle for services    MITA Architecturec    Enhanced 
administrative match 
via APD under MITAci 
Services provided via Telehealth      
  State Plan    Payments through 
  managed care 
entities;xcix 
  FFS payments for 
covered Medicaid 
service under 
appropriate benefit 
category 
Crisis Stabilization and Comprehensive     
Care Model (e.g., CCHBCcii)     
  Crisis behavioral health services,     
screening, assessment, and    Provider costs for outreach    FFS payment for 
diagnosis, mental health and SUD  and team supervision are not  covered Medicaid 
services, targeted case management,  directly coverable by  services under 
psychiatric rehabilitation services,  Medicaid state plan  appropriate benefit 
peer supports and family supports  authorities; but provider costs  category;  
related to delivery of covered    Administrative match 
services may be incorporated  for state administrative 
into rates for covered services;  activities that may be 
  1905(a) state plan benefits  allocated to 
such as Clinic Services,  Medicaid;ciii  
Diagnostic Services,    Payments through 
Rehabilitative Services,   managed care 
Physicians Services, Other  entitiesxcix 
Licensed Practitioner   
Services;  Page 25 State Medicaid Director 
 
  1945 Health Home state plan 
option, primary care case 
management 
Registry of Available Behavioral Health     
Providers     
  MITA Architecturec    Enhanced 
administrative match 
via APD under 
MITA;ci 
  Administrative match 
for state 
administrative 
activities that may be 
allocated to 
Medicaid.civ 
 
Supported Employment and Supportive     
Housing      FFS payments for 
  Assistance finding a job or    1915 (i)  covered Medicaid 
home and supportive services to    1915 (c)  service under 
help maintain that job or home    1915(b)(3)  appropriate benefit 
    1115(a)(2)  category; 
  Payments through 
managed care 
entitiesxcix 
 
 
 
Additional Information on Medicaid Authorities  
 
Many of the services that are essential to the implementation of services for adults with a SMI and 
children with a SED may be covered based on section 1905(a) of the Act.  A number of Medicaid 
service categories that are particularly relevant to covering the innovative service delivery strategies 
and community-based services for adults with a SMI or children with a SED described above are 
discussed below.   
 
Section 1905(a)  State Plan Benefits: 
 
Section 1905(a)(13) - Rehabilitative Services 
 
Rehabilitative services, as set forth in 42 C.F.R  440.130(d), are any medical or remedial services 
recommended by a physician or other licensed practitioner of the healing arts, within the scope of his 
practice under state law, for maximum reduction of physical or mental disability and restoration of a 
beneficiary to his best possible functional level.  Services such as individual and group therapy, 
crisis stabilization, peer support, behavioral interventions, and care coordination of other behavioral 
health services may be authorized under this benefit.   
  Page 26 State Medicaid Director 
 
Section 1905(a)(6) - Other Licensed Practitioner Services  
 
Other licensed practitioner services, as set forth in 42 C.F.R  440.60(a), are medical or remedial 
care or services, other than physicians services, provided by licensed practitioners within the scope 
of practice as defined under State law.  For example, this benefit could be used to cover counseling 
services of a licensed clinical social worker.    
 
Section 1905(a)(19) - Case Management Services  
 
Case management services include services that assist eligible individuals to gain access to needed 
medical, social, educational, and other services.  42 C.F.R  440.169(a).  Case management services 
include all of the following components: comprehensive assessment and periodic assessment of an 
eligible individuals needs; development and periodic revision of a specific care plan; referrals to 
services and related activities to help the eligible individual obtain needed services; and monitoring 
and follow-up activities.  42 C.F.R.  440.169(d).  States may target case management services to a 
specific group of beneficiaries, such as adults with SMI or children with SED, or to individuals who 
reside in specified areas of the state (or both).  42 C.F.R  440.169(b).   
 
Section 1905(a)(9) - Clinic Services  
 
Clinic services refer to preventive, diagnostic, therapeutic, rehabilitative, or palliative services that 
are furnished by a facility that is not part of a hospital but is organized and operated to provide 
medical care to outpatients. 42 C.F.R  440.90.  Clinic services include  services furnished at the 
clinic by or under the direction of a physician or dentist and services furnished outside the clinic, 
by clinic personnel under the direction of a physician, to an eligible individual who does not reside in 
a permanent dwelling or does not have a fixed home or mailing address.  42 C.F.R.  440.90(a)-(b). 
 
Section 1905(a)(5) - Physicians Services  
 
Physicians services refer to services whether furnished in the office, the beneficiarys home, a 
hospital, a skilled nursing facility, or elsewhere, means services furnished by a physician (1) within 
the scope of practice of medicine or osteopathy as defined by State law; and (2) by or under the 
personal supervision of an individual licensed under State law to practice medicine or osteopathy. 42 
C.F.R.  440.50(a).  
 
Section 1905(r) - Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) Benefit 
 
Under the Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) benefit set forth in 
section 1905(r) of the Act, states must make available any service listed in section 1905(a) of the Act 
that is needed to correct or ameliorate defects and physical and mental conditions discovered by 
EPSDT screening services, whether or not the service is covered under the state plan.   
 
Section 1905(a)(1) and (2) - Hospital Services  
  Page 27 State Medicaid Director 
 
Hospital Services, defined at 1905(a)(1) and 1905(a)(2) and implemented at 42 C.F.R.  440.10 and 
42 C.F.R.  440.20, includes both inpatient hospital and outpatient hospital services.  For inpatient 
hospital services, the term means services (1) that are ordinarily furnished in a hospital for the care 
and treatment of inpatients, (2) are furnished under the direction of a physician or dentist; and (3) are 
furnished in an institution that is maintained primarily for the care and treatment of patients with 
disorders other than mental diseases and is licensed or approved as a hospital by an officially 
designated authority for state standard setting.  There must be in effect a utilization review plan, 
applicable to all Medicaid patients that meets the requirements of 42 C.F.R.  482.30, absent a waiver 
from the Secretary. For outpatient hospital services, the term means preventive, diagnostic, 
therapeutic, rehabilitative, or palliative services that (1) are furnished to outpatients and (2) are 
furnished by or under the direction of a physician or dentist.  The criteria listed for inpatient hospital 
services regarding standard setting mean that meeting the requirements for Medicare participation 
also apply. Outpatient hospital services may be limited by a Medicaid agency by excluding from the 
definition those items and services that are not generally furnished by most hospitals in the state. 
 
Section 1905(a)(16) - Inpatient Psychiatric Services for Individuals under Age 21  
 
Under section 1905(a) of the Act, there is a general prohibition on Medicaid payment for any services 
provided to any individual who is under age 65 and who is residing in an Institution for Mental 
Diseases (IMD) unless the payment is for inpatient psychiatric hospital services for individuals under 
age 21 pursuant to section 1905(a)(16) of the Act, as defined in section 1905(h) of the Act.  
Implementing regulations at 42 C.F.R.  440.160 and 441 Subpart D define these inpatient 
psychiatric hospital services as services furnished by a psychiatric hospital, a general hospital with a 
psychiatric program that meets the applicable conditions of participation, or an accredited psychiatric 
facility that meets certain requirements.  Section 12005 of the 21st Century Cures Act amends section 
1905(a)(16) of the Act to require Medicaid reimbursement for EPSDT services to individuals under 
age 21 receiving inpatient psychiatric services pursuant to section 1905(a)(16) of the Act.  The 
effective date of this amendment is January 1, 2019.   
 
Section 1905(a)(14) - Inpatient Hospital Services and Nursing Facility Services for Individuals Age 
65 or Older in Institutions for Mental Diseases 
 
Services to individuals age 65 or older in these types of facilities may be reimbursed when the 
individuals meet the requirements for admission to these facilities and the facilities meet applicable 
federal requirements as set forth in 42 C.F.R  440.140. 
 
School-based Services 
 
While there is no state plan benefit entitled school-based services, CMS allows reimbursement of 
Medicaid-covered services to Medicaid-eligible children when delivered by Medicaid providers, 
including in a school setting.  Many states have already developed reimbursement mechanisms where 
Medicaid pays for medical services, including mental health treatment services in school 
settings.  States can consider developing school-based health centers to enhance their capacity to 
deliver mental health services, require managed care plans responsible for delivering mental health  Page 28 State Medicaid Director 
 
services to contract with school providers, or develop other arrangements between health facilities 
and schools.   
 
Sections 1903(m) and 1932  Managed Care 
 
Consistent with sections 1903(m) and 1932 of the Act, states may deliver Medicaid-covered services 
through managed care plans by way of an amendment to the Medicaid state plan. States must 
continue to assure adequate access to and the availability of the full set of covered state plan services, 
including EPSDT and generally must provide beneficiaries with a choice of at least two managed 
care plans.  Managed care contracts are subject to CMS review and approval; managed care 
capitation rates must be projected to provide for all reasonable, appropriate, and attainable costs that 
are required under the terms of the contract and for the operation of the managed care plan for the 
time period and the population covered under the terms of the contract and be reviewed and approved 
by CMS as actuarially sound.  
 
Section 1915(b) Authority  Freedom of Choice 
 
Under section 1915(b) of the Act (1915(b) waiver), CMS may grant a waiver to permit states to 
restrict beneficiary free choice of provider, to create defined provider networks, which could be part 
of a managed care service delivery system. When using this authority, states may use the savings 
accrued through the use of a managed care delivery system to provide additional services.  Unless an 
expenditure authority is provided as part of a section 1115 demonstration, managed care service 
delivery systems that rely on contracts with managed care plans must also comply with section 
1903(m).  Under section 1915(a) of the Social Security Act, states can implement a voluntary 
managed care program by executing a contract with organizations that the state has procured using a 
competitive procurement process. 
 
Section 1915(c) - Home and Community-based Services Waiver Authority 
 
States may request a waiver to provide beneficiaries who would otherwise need to receive care in an 
institution, certain long-term care services and supports in community settings.  States can use this 
authority to develop comprehensive benefit designs that include additional supportive services.  
States may not restrict freedom of choice under this waiver but may request waivers of comparability 
and state-wideness, enabling them to limit the services to subgroups of Medicaid beneficiaries and to 
an area within the state. States may also limit participation to a specific number of beneficiaries.  
 
 
Section 1915(i)  Home and Community-based Services State Plan Amendment  
 
Section 1915(i) provides an opportunity for states to amend their state Medicaid plans to offer home 
and community-based services (HCBS) including case management, respite, and other HCBS for 
elderly and disabled individuals who meet needs-based eligibility criteria set by the state. Section 
1915(i) State plan HCBS is a benefit that is very similar to Section 1915(c) HCBS waivers except 
that unlike 1915(c), authority under 1915(i) delinks the provision of HCBS from the requirement that 
participants must meet an institutional level of care.  In order to target the initiative and limit costs,  Page 29 State Medicaid Director 
 
states may identify a specific population and can also establish additional needs-based criteria by 
service.  States may target the 1915(i) benefit to particular population groups such as adults or 
adolescents with mental health disorders, but cannot waive the requirement to provide the HCBS 
statewide, nor limit the number of participants in the state who may receive the HCBS if they meet 
the population definition.   
 
Section 1945 - Health Home Optional Benefit  
 
Section 1945 of the Act provides an optional Medicaid state plan benefit available to states to design 
Health Homes to coordinate care for individuals with Medicaid who have chronic conditions, 
including a mental health condition or SUD.  Health Homes must provide comprehensive care 
management, care coordination, health promotion, comprehensive transitional care/follow-up, 
beneficiary and family/caregiver support, and referral to community and social support services.   
 
 
    Page 30 State Medicaid Director 
 
Appendix B 
 
Potential Standard Measures and Measure Concepts 
 
Participating states will commit to reporting on a standard set of measures and data points to 
demonstrate progress on the goals of the demonstration.  Examples of measures and measure 
concepts that could be included in a standard set measures include -- 
 
  Evidence of availability of community-based services and alternatives to inpatient and 
residential services in each geographic region of the state (e.g., maps of provider availability 
and provider agreements) 
 
  ED use among Medicaid beneficiaries with SMI or SED and their lengths of stay in the ED; 
 
  Readmissions to inpatient psychiatric or crisis residential settings; 
 
  Average lengths of stay in participating psychiatric hospitals and residential settings; 
 
  Medication reconciliation upon admission (Medicare Inpatient Psychiatric Facility (IPF) 
Reporting Requirement); 
 
  SUD screening of beneficiaries admitted to psychiatric hospitals or residential treatment 
settings (Medicare IPF Reporting Requirement); 
 
  Timely transmission of transition records (Medicare IPF Reporting Requirement); 
 
  Medication continuation following discharge (Medicare IPF Reporting Requirement); 
 
  Follow up after hospitalization for mental illness (NQF# 0576, Adult and Child Core Set); 
 
  Follow up after ED visit for mental illness or alcohol and other drug abuse or dependence 
(NQF# 2605, Adult Core Set); 
 
  Use of first-line psychosocial care for children and adolescents on antipsychotics (NQF#2801, 
Child Core Set); 
 
  Patient referral into treatment by specified care setting (school, community, criminal justice, 
faith communities); 
 
  Diabetes care for patients with SMI: Hemoglobin A1c (HbA1c) Poor Control (>9.0%) (NQF 
# 2607, Adult Core Set)cv; 
 
  Screening for Depression and Follow-Up Plan (NQF #0418/0418e, Adult Core Set); 
  Page 31 State Medicaid Director 
 
  Rates of involuntary admissions to treatment settings;  
 
  Access to preventive/ambulatory health services for Medicaid beneficiaries with SMI or SED; 
and 
 
  Suicide or overdose death within 15 days of discharge from an inpatient facility or residential 
setting for treatment for an SMI or SED.  Page 32 State Medicaid Director 
 
                                                 
 
 
ENDNOTES 
i See Pub. L. 114-255. Available at https://www.gpo.gov/fdsys/pkg/PLAW-114publ255/pdf/PLAW-114publ255.pdf . 
ii See definition developed by the Substance Abuse and Mental Health Services Administration (SAMHSA) as mandated 
by the Congress in the ADAMHA Reorganization Act (Public Law 102-321) at 58 Fed. Reg. 96, pp. 29422-29425 (May 
20, 1993). 
iii Ibid. 
iv SAMHSA, NSDUH Data Review, Receipt of Services for Substance Use and Mental Health Issues among Adults: 
Results from the 2016 National Survey on Drug Use and Health (Sept. 2017). 
v See definition developed by the Substance Abuse and Mental Health Services Administration (SAMHSA) as mandated 
by the Congress in the ADAMHA Reorganization Act (Public Law 102-321) at 58 Fed. Reg. 96, 29422-29425 (May 20, 
1993) (The definition included in the regulation references DSM-III, however the latest edition is DSM-V.). 
vi Ibid.  
vii Kessler RC, Chiu WT, Demier, O, et al. Prevalence, severity and comorbidity of twelve-month DSM-IV disorders in 
the National Comorbidity Survey Replication (NCS-R). Archives of General Psychiatry 2005; 62: 617627. 
viii National Research Council and Institute of Medicine, Preventing Mental, Emotional, and Behavioral Disorders 
Among Young People: Progress and Possibilities (2009). 
ix Perou R, Bitsko RH, Blumberg SJ. Mental health surveillance among children--United States, 2005-2011. MMWR 
Suppl. May 2013; 62(2):1-35. 
x Simon AE, Pastor PN, Reuben CA, et al. Use of mental health services by children ages six to 11 with emotional or 
behavioral difficulties. Psych Services 2015; 66(9): 930937. 
xi Substance Abuse and Mental Health Administration, Key Substance Use and Mental Health Indicators in the United 
States: Results from the 2016 National Survey on Drug Use and Health (2017). 
xii Stagman S and Cooper JL, Childrens Mental Health: What Every Policymaker Should Know, National Center for 
Children in Poverty, April 2010: http://www.nccp.org/publications/pdf/text_929.pdf; Wagner M and Newman L. 
Longitudinal Transition Outcomes of Youth with Emotional Disturbances. Psych Rehab 2012; 35(3): 199-208. 
xiii Wang PS, Berglund PA, Olfson M, et al. Delays in initial treatment contact after first onset of a mental 
disorder. Health Serv Res 2004; 39(2):393-415. 
xiv Frank RG and Epstein AM. Factors Associated with High Levels of Spending for Younger Dually Eligible 
Beneficiaries with Mental Disorders. Health Affairs. 2014; 33(6): 1006-1013.. 
xv Steadman HJ, Osher FC, Robbins PC, et al., Prevalence of Serious Mental Illness among Jail Inmates, Psych Services, 
60 (6): 761-765 (2009); Point in time estimate based on applications to U.S. Department of Housing and Urban 
Development for 2016 Continuum of Care Homeless Assistance Programs, Retrieved from 
https://www.hudexchange.info/resource/reportmanagement/published/CoC_PopSub_NatlTerrDC_2016.pdf.   
xvi Interdepartmental Serious Mental Illness Coordinating Committee, Report to Congress, The Way Forward: Federal 
Action for a System That Works for All People Living With SMI and SED and Their Families and Caregivers (Dec 
2017): https://store.samhsa.gov/product/PEP17-ISMICC-RTC (citing Uniform Reporting System which can be found at 
https://wwwdasis.samhsa.gov/dasis2/urs.htm) . 
xvii Druss GB, Zhao L, Von Esenwein S, et al. Understanding Excess Mortality in Persons with Mental Illness. Medical 
Care 2011; 49(6). 
xviii Centers for Disease Control and Prevention, Morbidity and Mortality Weekly Report, Surveillance for Violent 
Deaths  National Violent Death Reporting System, 17 States, 2013 2016; 65 (No. SS-10): 1-42; Brown NM, Green JC, 
Desai MM, et al. Need and Unmet Need for Care Coordination Among Children With Mental Health Conditions, 
Pediatrics. March 2014; 113(3): e530-537. 
xix Centers for Disease Control and Prevention, Vital Signs Report, Suicide Rising Across the US (June 2018): 
https://www.cdc.gov/vitalsigns/pdf/vs-0618-suicide-H.pdf . 
xx CMCS Informational Bulletin, Prevention and Early Identification of Mental Health and Substance Use Conditions 
(March 2013): https://www.medicaid.gov/federal-policy-guidance/downloads/CIB-03-27-2013.pdf . 
xxi Schoenbaum M, Sutherland JM, Chappel A, et al.  Twelve-Month Health Care Use and Mortality in Commercially 
Insured Young People with Incident Psychosis in the United States. Schizophr Bull. Oct 2017; 43(6): 1262-1272; Simon 
GE, Stewart C, Yarborough BJ, et al. Mortality Rates After the First Diagnosis of Psychotic Disorder in Adolescents and 
Young Adults. JAMA Psych. 2018; 75(3):254-260. 
  Page 33 State Medicaid Director 
 
                                                                                                                                                                     
 
 
xxii Simon GE, Stewart C, Yarborough BJ, et al. Mortality Rates After the First Diagnosis of Psychotic Disorder in 
Adolescents and Young Adults. JAMA Psych. 2018; 75(3):254-260. 
xxiii Dixon LB, Goldman HH, Bennett ME, et al. Implementing Coordinated Specialty Care for Early Psychosis: the 
RAISE Connection Program. Psych Services. July 2017; 66 (7): 691-698. 
xxiv CMCS Informational Bulletin, Coverage of Early Intervention Services for First Episode Psychosis (Oct 2015)): 
https://www.medicaid.gov/federal-policy-guidance/downloads/cib-10-16-2015.pdf  
xxv For example the Robert Wood Johnson Foundation initiative, The Early Detection and Intervention for Prevention of 
Psychosis Program, with six sites nationwide resulted in some positive outcomes, for additional information see reports at 
the following links: http://dev.nasmhpd.seiservices.com/content/about-edippp  and 
https://www.nasmhpd.org/sites/default/files/RWJF%20Findings%20Report%202014.pdf . 
xxvi See webpage on the Medicaid Information Technology architecture (MITA) 3.0: 
https://www.medicaid.gov/medicaid/data-and-systems/mita/mita-30/index.html ; Under MITA 3.0, implementation of 
new technologies may qualify for enhanced match of 90 percent federal match for establishing the technology and 75 
percent match for operational support. CMS State Medicaid Director Letter # 18-006, Leveraging Medicaid Technology 
to Address the Opioid Crisis (June 2018): https://www.medicaid.gov/federal-policy-guidance/downloads/smd18006.pdf . 
xxvii See CMS Final Rule: Mechanized Claims Processing and Information Retrieval Systems (90/10), 80 FR 75817. 
xxviii See https://www.hhs.gov/hipaa/for-professionals/special-topics/mental-health/index.html, Information Related to 
Mental and Behavioral Health, including Opioid Overdose (fact sheets and materials written for professionals). 
xxix See https://www.hhs.gov/hipaa/for-individuals/mental-health/index.html, Information Related to Mental and 
Behavioral Health, including Opioid Overdose (consumer facing materials and fact sheets) 
xxx Rones M, Hoagwood K, School-based mental health services: a research review. Clin Child Fam Psychol Rev. Dec. 
2000; 3(4): 223-241. 
xxxi Weist MD, Myers CP, Hastings E, et al. Psychological functioning of youth receiving mental health services in the 
schools versus community mental health centers. Community Ment Health J. Feb 1999; 35(1): 69-81. 
xxxii Nabors LA, Reynolds MW. Program evaluation activities: Outcomes related to treatment for adolescents receiving 
school-based mental health services. Childrens Services: Social Policy, Research, and Practice. 2000; 3(3):175-189. 
xxxiii Department of Health and Human Services and Department of Education, Healthy Students, Promising Futures: 
State and Local Action Steps and Practices to Improve School-Based Health (January 2016): 
https://www2.ed.gov/admins/lead/safety/healthy-students/toolkit.pdf . 
xxxiv Price OA. School-centered approaches to improve community health: lessons from school-based health centers. 
Economic Studies at Brookings July 2016; No. 5: https://www.brookings.edu/wp-content/uploads/2016/07/Price-
Layout2-1.pdf . 
xxxv Ahmedani BK, Stewart C, Simon GE, et al. Racial/ethnic differences in healthcare visits made prior to suicide attempt 
across the United States. Medical Care. May 2015; 53(5): 430-435. 
xxxvi For more information about the PHQ-9 and how to score, refer to http://www.cqaimh.org/pdf/tool_phq9.pdf  
xxxvii AIMS Center (Advancing Integrated Mental Health Solutions). Collaborative Care Evidence 
Base:  https://aims.uw.edu/collaborative-care/evidence-base ; Archer J, Bower P, Gilbody S, et al. Collaborative Care for 
People with Depression and Anxiety. Cochrane Review. Oct. 2012: 
http://www.cochrane.org/CD006525/DEPRESSN_collaborative-care-for-people-with-depression-and-anxiety; 
Community Preventive Services Task Force, Improving Mental Health and Addressing Mental Illness: Collaborative 
Care for the Management of Depressive Disorders (June 2010): 
https://www.thecommunityguide.org/sites/default/files/assets/Mental-Health-Collaborative-Care.pdf. 
xxxviii A list of programs by state is on the network website: http://web.jhu.edu/pedmentalhealth/nncpap_members.html. 
xxxix Straus JH, Sarvet B. Behavioral Health Care for Children: The Massachusetts Child Psychiatry Access Project. 
Health Affairs. 2014; 33 (12): 2153-2161. 
xl See Medicare fact sheet on Collaborative Care Model including CPT codes that can be used: 
https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-
MLN/MLNProducts/Downloads/BehavioralHealthIntegration.pdf . 
xli Raney L, Bergman D, Torous J, et al. Digitally driven integrated primary care and behavioral health: how technology 
can expand access to effective treatment. Curr Psychiatry Rep. 2017; 19(11): 1-8. 
xlii Under MITA 3.0, implementation of new technologies may qualify for enhanced match of 90 percent federal match for 
establishing the technology and 75 percent match for operational support.  See CMS State Medicaid Director Letter # 18-
006, Leveraging Medicaid Technology to Address the Opioid Crisis (June 2018): https://www.medicaid.gov/federal-
policy-guidance/downloads/smd18006.pdf . 
  Page 34 State Medicaid Director 
 
                                                                                                                                                                     
 
 
xliii CMS State Medicaid Director Letter # 18-006, Leveraging Medicaid Technology to Address the Opioid Crisis (June 
2018): https://www.medicaid.gov/federal-policy-guidance/downloads/smd18006.pdf . 
xliv CMS State Medicaid Director Letter #16-003, Availability of HITECH Administrative Matching Funds to Help 
Professionals and Hospitals Eligible for Medicaid EHR Incentive Payments Connect to Other Medicaid Providers, (Feb 
2016): https://www.medicaid.gov/federal-policy-guidance/downloads/smd16003.pdf . 
xlv See CMCS Informational Bulletin, Coverage of Behavioral Health Services for Children, Youth, and Young Adults 
with Significant Mental Health Conditions (May 2013): https://www.medicaid.gov/federal-policy-
guidance/downloads/CIB-05-07-2013.pdf. 
xlvi National Association of State Mental Health Program Directors, Issue Brief: Crisis Services Role in Reducing 
Avoidable Hospitalization (Aug 2017). 
xlvii National Association of State Mental Health Program Directors, Issue Brief: Care Transition Interventions to Reduce 
Psychiatric Re-hospitalizations (Sept 2015). 
xlviii Agency for Healthcare Research and Quality (AHRQ) Healthcare Cost and Utilization Project (HCUP) on hospital 
readmissions involving psychiatric disorders, AHRQ/HCUP Statistical Brief #189: Hospital Readmissions Involving 
Psychiatric Disorders, 2012,(May 2015): (http://www.hcup-us.ahrq.gov/reports/statbriefs/sb189-Hospital-Readmissions-
Psychiatric-Disorders-2012.pdf). 
xlix Additional information regarding the LOCUS tool is available at 
https://sites.google.com/view/aacp123/resources/locus and for the CASII tool at 
http://www.aacap.org/aacap/Member_Resources/Practice_Information/CASII.aspx . 
l See State Health Official Letter issued jointly by CMS, SAMHSA, and the Administration on Children and Families 
regarding Trauma-informed Care (July 2013): https://www.medicaid.gov/Federal-Policy-Guidance/Downloads/SMD-13-
07-11.pdf . 
li National Association of State Mental Health Program Directors, Issue Brief: Crisis Services Role in Reducing 
Avoidable Hospitalization (Aug 2017). 
lii National Action Alliance for Suicide Prevention, Crisis Services Task Force, Crisis Now: Transforming Services Is 
Within Our Reach (2016): 
https://actionallianceforsuicideprevention.org/sites/actionallianceforsuicideprevention.org/files/CrisisNow.pdf . 
liii Clause (B) following section 1905(a)(29) of the Act. 
liv Section 1905(i) of the Act.   
lv See Medicaid managed care rules at 42 CFR 438.6(e).  
lvi See Medicaid webpage on tobacco quitlines: https://www.medicaid.gov/medicaid/quality-of-care/improvement-
initiatives/tobacco/quitlines/index.html . 
lvii Ibid. 
lviii Guidance for Administrative Claiming through the No Wrong Door System is available on the Medicaid website at 
https://www.medicaid.gov/medicaid/finance/admin-claiming/no-wrong-door/index.html. 
lix Authorized by Section 223 of the Protecting Access to Medicare Act (Pub.L. 113-93). 
lx For additional information on the CCBHC Criteria see 
https://www.samhsa.gov/sites/default/files/programs_campaigns/ccbhc-criteria.pdf  
lxi See CMS webpage on CCBHCs at https://www.medicaid.gov/medicaid/financing-and-reimbursement/223-
demonstration/index.html and Prospective Payment System Guidance at 
https://www.samhsa.gov/sites/default/files/grants/pdf/sm-16-001.pdf#page=94 . 
lxii See CMS webpage on Medicaid Information Technology (MITA) 3.0: https://www.medicaid.gov/medicaid/data-and-
systems/mita/mita-30/index.html;Under MITA 3.0, implementation of new technologies may qualify for enhanced match 
of 90 percent federal match for establishing the technology and 75 percent match for operational support.  CMS State 
Medicaid Director Letter # 18-006, Leveraging Medicaid Technology to Address the Opioid Crisis (June 2018): 
https://www.medicaid.gov/federal-policy-guidance/downloads/smd18006.pdf; See also CMS Guidance Questions and 
Answers: Administrative Claiming Related to Training and Registry Costs (July 2015): 
https://www.medicaid.gov/medicaid/financing-and-reimbursement/downloads/qa-training-registry-costs-071015.pdf 
(regarding Medicaid support for development of registries of qualified providers of long term services and supports with 
costs of its establishment and maintenance allocated between Medicaid and non-Medicaid funding streams). 
lxiii Bond GR, Drake RE. The critical ingredients of assertive community treatment. World Psychiatry. June 2015;14(2): 
240-242. 
lxiv CMS State Medicaid Director Letter on Assertive Community Treatment (June 1999): 
http://www.medicaid.gov/Federal-Policy-Guidance/downloads/SMD060799b.pdf . 
  Page 35 State Medicaid Director 
 
                                                                                                                                                                     
 
 
lxv Final Rule entitled Medicaid Program; State Plan Home and Community-Based Services, 5-Year Period for Waivers, 
Provider Payment Reassignment, and Home and Community-Based Setting Requirements for Community First Choice 
and Home and Community-Based Services (HCBS) Waivers (issued 01/16/2014):  https://www.gpo.gov/fdsys/pkg/FR-
2014-01-16/pdf/2014-00487.pdf . 
lxvi  HHS Guidance for Implementing Standards for Person Centered Planning and Self-Direction issued in June 2014: 
https://www.acl.gov/sites/default/files/programs/2017-03/2402-a-Guidance.pdf . 
lxvii Croft B, Isvan N, Parish S, et al. Housing and Employment Outcomes for Mental Health Self-Direction Participants. 
Psych Services. July 2018; 69(7):819-825.   
lxviii CMS State Medicaid Director Letter on peer supports (Aug 2007): https://www.medicaid.gov/Federal-Policy-
Guidance/downloads/SMD081507A.pdf. 
lxix CMS Guidance, Clarifying Guidance on Peer Support Services Policy (May 2013): 
https://www.medicaid.gov/medicaid/benefits/downloads/clarifying-guidance-support-policy.pdf . 
lxx Chung DT, Ryan CJ, Hadzi-Pavlovic D, et al. Suicide rates after discharge from psychiatric facilities: a systematic 
review and meta-analysis. JAMA Psychiatry. 2017; 74(7): 694-702.  
lxxi CMS, Medicaid/CHIP Health Care Quality Measures Technical Assistance and Analytic Support Program, Quality of 
Care for Adults in Medicaid: Findings from the 2016 Adult Core Set: Chart Pack (Dec. 2017) : 
https://www.medicaid.gov/medicaid/quality-of-care/downloads/performance-measurement/2017-adult-chart-pack.pdf. 
lxxii CMS, Medicaid/CHIP Health Care Quality Measures Technical Assistance and Analytic Support Program, Quality 
of Care for Children in Medicaid and CHIP: Findings from the 2016 Child Core Set: Chart Pack (Dec. 2017) 
https://www.medicaid.gov/medicaid/quality-of-care/downloads/performance-measurement/2017-child-chart-pack.pdf . 
lxxiii See the CMS webpage on the Medicare Hospital Readmissions Reduction Program: 
https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-
Programs/HRRP/Hospital-Readmission-Reduction-Program.html . 
lxxiv CMS webpage, 2018 Core Set of Adult Health Care Quality Measures (Adult Care Set): 
https://www.medicaid.gov/medicaid/quality-of-care/downloads/performance-measurement/2018-adult-core-set.pdf  
lxxv CMS webpage, 2018 Core Set of Childrens Health Care Quality Measures for Medicaid and CHIP (Child Core 
Set): https://www.medicaid.gov/medicaid/quality-of-care/downloads/performance-measurement/2018-child-core-set.pdf. 
lxxvi Denchev P, Pearson JL, Allen MH, et al. Modeling the cost-effectiveness of interventions to reduce suicide risk 
among hospital emergency department patients. Psych Services. Jan 2018; 69 (1): 23-31. 
lxxvii Denchev P, Pearson JL, Allen MH, et al. Modeling the cost-effectiveness of interventions to reduce suicide risk 
among hospital emergency department patients. Psych Services. Jan 2018; 69 (1): 23-31 (assuming for the telephone and 
CBT interventions a societal willingness to pay to reduce mortality of $50,000 per life-year). 
lxxviii National Association of State Mental Health Program Directors, Issue Brief: Care Transition Interventions to 
Reduce Psychiatric Re-hospitalizations (Sept 2015). 
lxxix Lucksted A, Essock SM, Stevenson J, et al. Client views of engagement in the RAISE Connection Program for early 
psychosis recovery. Psych Services July 2015; 66(7): 699-704. 
lxxx National Association of State Mental Health Program Directors, Issue Brief: The Role of Permanent Supportive 
Housing in Determining Psychiatric Inpatient Bed Capacity (August 2017). 
lxxxi Interdepartmental Serious Mental Illness Coordinating Committee, Report to Congress, The Way Forward: Federal 
Action for a System That Works for All People Living With SMI and SED and Their Families and Caregivers (Dec 
2017): https://store.samhsa.gov/product/PEP17-ISMICC-RTC (citing Uniform Reporting System which can be found at 
https://wwwdasis.samhsa.gov/dasis2/urs.htm). 
lxxxii The optional eligibility groups that serve people who have disabilities and are earning income are described at 
sections 1902(a)(10)(A)(ii)(XIII), (XV), and (XVI) of the Act.  These eligibility groups generally have higher income and 
resource standards than other mandatory and optional eligibility groups that serve people who have disabilities, and states 
have the flexibility to increase these standards beyond the statutory minimums. Nearly all states cover at least one of these 
groups, and most have exercised their flexibility relating to financial eligibility.    
lxxxiii The Medicaid Buy-in program is authorized at section 1902(a)(10)(A)(ii)(XV) of the Act.  It establishes an optional 
state Medicaid benefit group for workers with disabilities who have earnings in excess of traditional Medicaid rules. 
Individuals with disabilities who would be ineligible for Medicaid because of earnings can work and access the services 
and supports they need.  For more information got to the CMS webpage at  
https://www.medicaid.gov/medicaid/ltss/employmment/ticket-to-work/index.html .   
lxxxiv CMS State Medicaid Director Letter #17-003, Strategies to Address the Opioid Epidemic (Nov 2017): 
https://www.medicaid.gov/federal-policy-guidance/downloads/smd17003.pdf . 
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lxxxv Centers for Disease Control and Prevention, National Center for Health Statistics Data Brief No. 293 Mortality in 
the United States, 2016 (Dec. 2017): https://www.cdc.gov/nchs/data/databriefs/db293.pdf . 
lxxxvi Centers for Disease Control and Prevention, Morbidity and Mortality Weekly Report, Surveillance for Violent 
Deaths  National Violent Death Reporting System, 17 States, 2013 2016; 65 (No. SS-10): 1-42; Cho SE, Na KS, Cho 
SJ, et al. Geographical and temporal variations in the prevalence of mental disorders in suicide: systematic review and 
meta-analysis. J Affect Disord 2016; 190:704-713. 
lxxxvii See sec. 1905(a) of the Act (does not include room and board as a separate, coverable benefit); 42 CFR  440.2 
(room and board costs are included in the definition of inpatient); 42 CFR  440.140 (regarding services for individuals 
age 65 and older in an IMD). 
lxxxviii See sec. 1905(a)(16) of the Act authorizing the Inpatient Psychiatric Services for Individuals under Age 21 benefit 
and CMS implementing regulations defining the types of settings that can provide this benefit at 42 C.F.R.  440.160 and 
441 Subpart D. 
lxxxix CMS State Health Official Letter #16-007, To Facilitate Successful Re-entry for Individuals Transitioning from 
Incarceration to Their Communities see Question 8: https://www.medicaid.gov/federal-policy-
guidance/downloads/sho16007.pdf. 
xc CMS recently issued a State Medicaid Director Letter on Budget Neutrality Policies for Section 1115(a) Medicaid 
Demonstration Projects (August 2018): https://www.medicaid.gov/Federal-Policy-Guidance/downloads/SMD18009.pdf  
xci For guidance on comprehensive crisis stabilization systems and an assessment template, see the National Action 
Alliance for Suicide Prevention: Crisis Services Task Force, Crisis now: Transforming services is within our reach 
(2016):  http://actionallianceforsuicideprevention.org/sites/actionallianceforsuicideprevention.org/files/CrisisNow.pdf ; an 
example of a crisis stabilization system assessment tool is at https://www.slideshare.net/davidwcovington/crisis-now-
assessment-framework  
xcii CMS has also previously issued a State Medicaid Director Letter on covering peer support services in Medicaid,  
https://www.medicaid.gov/Federal-Policy-Guidance/downloads/SMD081507A.pdf , as well as additional clarification 
that peer supports in some circumstances can include peer supports for the parents/legal guardians of Medicaid eligible 
children, https://www.medicaid.gov/medicaid/benefits/downloads/clarifying-guidance-support-policy.pdf . 
xciii Bond GR, Drake RE. The critical ingredients of assertive community treatment. World Psychiatry. June 2015; 14(2): 
240-242. 
xciv Additional information regarding the LOCUS tool is available at 
https://sites.google.com/view/aacp123/resources/locus and for the CASII tool at 
http://www.aacap.org/aacap/Member_Resources/Practice_Information/CASII.aspx . 
xcv For example, the Robert Wood Johnson Foundations initiative on the Early Detection and Intervention for the 
Prevention of Psychosis Program with six sites nationwide resulted in some positive outcomes: 
http://dev.nasmhpd.seiservices.com/content/about-edippp ; and 
https://www.nasmhpd.org/sites/default/files/RWJF%20Findings%20Report%202014.pdf. 
xcvi See CMCS Informational Bulletin, Coverage of Behavioral Health Services for Children, Youth, and Young Adults 
with Significant Mental Health Conditions (May 2013): https://www.medicaid.gov/federal-policy-
guidance/downloads/CIB-05-07-2013.pdf . 
xcvii See CMCS Informational Bulletin (CIB) on Coverage of Early Intervention Services for First Episode Psychosis (10/16/2015): 
https://www.medicaid.gov/federal-policy-guidance/downloads/cib-10-16-2015.pdf 
xcviii Please note that if the state is directing the expenditures a managed care plan is making to its providers, it must 
comply with the requirements in 42 CFR 438.6(c); this includes obtaining prior approval for such directed payments. For 
more information, please see the following CIB published on November 2, 2017: https://www.medicaid.gov/federal-
policy-guidance/downloads/cib11022017.pdf. Also published as part of this CIB are -- 
-  an appendix that provides some examples of approvable directed payments: 
https://www.medicaid.gov/medicaid/managed-care/downloads/guidance/appendix-a.pdf; and 
-  the preprint that states would need to submit to obtain prior approval of such directed payments: 
https://www.medicaid.gov/medicaid/managed-care/downloads/guidance/438-preprint.pdf. 
xcix See CMS guidance on MITA 3.0 at https://www.medicaid.gov/medicaid/data-and-systems/mita/mita-30/index.html. 
c See SMDL # 18-006, Leveraging Medicaid Technology to Address the Opioid Crisis June 11, 2018. 
ci See Department of Health and Human Services and Education toolkit on improving availability of school-based 
services: https://www2.ed.gov/admins/lead/safety/healthy-students/toolkit.pdf .  
cii See CMS information on CCBHCs: https://www.medicaid.gov/medicaid/financing-and-reimbursement/223-
demonstration/index.html and Prospective Payment System Guidance: https://www.samhsa.gov/sites/default/files/grants/pdf/sm-16-
001.pdf#page=94 
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ciii See CMS guidance on tobacco quitlines:  https://www.medicaid.gov/medicaid/quality-of-care/improvement-
initiatives/tobacco/quitlines/index.html 
civ See CMS guidance on Administrative Claiming Related to Training and Registry Costs: 
https://www.medicaid.gov/medicaid/financing-and-reimbursement/downloads/qa-training-registry-costs-071015.pdf. 
cv Additional information on endorsed measures is available by using the National Quality Forums QPS tool:  
http://www.qualityforum.org/Measures_Reports_Tools.aspx .