NC Medicaid 1915(i) Individual Placement & Support (IPS) for Mental Health & Substance Use
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Defines coverage, eligibility, and program requirements for IPS vocational services for NC Medicaid beneficiaries age 16 and older with significant behavioral health needs; applies to providers delivering IPS under NC Medicaid 1915(i).
Language referencing prior approval was revised and language referencing authorizations and utilization management were removed to comply with federal parity and CFR requirements.
Program Assistant duties were updated to remove 'Manage authorization requests'.
Coverage Criteria and Medical Necessity
General medical necessity criteria
Covered when ALL of the following are met:
Supports: chunks 18, 14
IPS service coverage principles
IPS program requirements and principles
Supports: chunk 8
Coverage (Initial eligibility)
Medicaid shall cover IPS when ALL of the following are met:
Supports: chunk 18
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Admission Criteria
Admission requires BOTH of the following:
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Continued Service Criteria
Continued services allowed if beneficiary meets AT LEAST one of the following:
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Discharge Criteria
Discharge should be based on one or more of the following:
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Coverage criteria and program requirements
Covered when ALL of the following are met:
based on provider enrollment and organizational standards
includes collaboration with DVRS
subsequent review scheduling based on most recent score
see staffing and role descriptions
training must be DHHS-approved
telehealth allowed with restrictions; telephonic participation not allowed for vocational or treatment team meetings
Coverage when IPS goals are pursued
Covered when services are provided as Individual Placement & Support aimed at vocational recovery with measurable employment outcomes
From section 6.4
No additional specific covered criteria are listed in this policy section. Specific criteria covered by Medicaid: None Apply.
The policy excludes services that are educational, pre-vocational, recreational, or administrative rather than individualized employment supports. Examples of non-covered services include: teaching academic subjects or substituting for educational personnel; pre-vocational classes; supports for volunteering; supports for set-aside jobs, enclaves, mobile work crews, or transitional employment; group employment searches or classes; habilitative services for basic living skills; non-employment-related transportation; services to family or natural supports that do not directly address the beneficiary's issues as documented on the Career Profile; clinical/administrative supervision of IPS staff (included as indirect cost in the rate); time spent in meetings when the beneficiary is not present; recreational activities; childcare or substitute parental care; interventions not on the beneficiary's service plan; services under the Rehabilitation Act of 1973; special education under IDEA; and payment for room and board.
IPS services must be community-based and individualized and are not provided in groups or congregate settings. IPS staff are required to spend 65% or more of total scheduled work hours in the community. Teams must hold weekly vocational unit meetings; in-person attendance is preferred. A HIPAA-compliant virtual telehealth platform may be used for vocational unit meetings for up to three meetings per month (use of cameras is recommended), but telephonic participation in vocational unit meetings is not allowed.
EPSDT exceptions apply for Medicaid beneficiaries under age 21. When a beneficiary under 21 has an assessed need, EPSDT may require coverage of services or exceed policy limits if provider documentation demonstrates the service is medically necessary to correct or ameliorate a condition. See Subsection 2.2.1 and related EPSDT guidance for documentation and prior approval procedures specific to beneficiaries under 21.
Services that are unsafe, ineffective, experimental or investigational, or not medical in nature are not required under EPSDT and therefore are not covered. Additionally, Medicaid does not cover procedures, products, or services that duplicate another provider's service or are part of a clinical trial. Providers must ensure interventions meet medical necessity and are recognized methods of treatment.
A procedure, product, or service is not medically necessary when the beneficiary does not meet the eligibility requirements in Section 2.0 or the coverage criteria in Section 3.0, when the service duplicates another provider's service, or when the service is experimental, investigational, or part of a clinical trial. Such grounds are valid reasons for denial or nonpayment.
Billing Codes, Modifiers, and Related Requirements
| H2023 | Supported Employment Services; per 15 minutes (billing unit = 1 unit = 15 minutes) |
| U4 | HCPCS modifier referenced in policy |
Provider Responsibilities and Operational Requirements
Eligibility verification
Verify each Medicaid beneficiary's eligibility each time a service is rendered. Providers must confirm active NC Medicaid enrollment and any service restrictions related to the beneficiary's eligibility category prior to delivering and billing for IPS services.
Billing must use the most specific code
Provider(s) shall report the most specific billing code that accurately and completely describes the procedure, product, or service provided. Use current CPT, HCPCS, and UB-04 guidance and report codes to the highest level of specificity that supports medical necessity. Example: H2023 billed in 15-minute units (1 unit = 15 minutes). If no specific CPT/HCPCS code exists, report using the appropriate unlisted procedure or service code.
- H2023 — Billing unit = 1 unit = 15 minutes
EPSDT documentation
For beneficiaries under 21, EPSDT (Early and Periodic Screening, Diagnostic, and Treatment) requirements apply. EPSDT may allow services or exceed policy limits when documentation shows the service is medically necessary to correct or ameliorate a condition. EPSDT does not remove other prior approval requirements when applicable; refer to NCTracks and the EPSDT provider page for process details.
- EPSDT covers medically necessary services for beneficiaries under 21 to correct or ameliorate health problems.
- If prior approval is required by a service, beneficiary age under 21 does not eliminate prior approval requirements.
Required clinical documentation
Providers must maintain complete clinical documentation for each service rendered. A full-service note is required per date of service and must be written and signed by the staff member who provided the service. The staff who provided the service is responsible for accurately documenting services billed to Medicaid. A Career Profile is required and an integrated Person-Centered Plan with an attached in-depth Career Profile is required for enhanced services. A documented discharge plan must be discussed with the beneficiary and contained in the service record.
- Full-service note per date of service signed by the provider who performed the service; signature must include credentials.
- Career Profile required; integrated Person-Centered Plan with Career Profile for enhanced services.
- Documented discharge plan coordinated with other providers when applicable.
Service order requirements
A signed service order demonstrating medical necessity is required and must be completed by an authorized professional within their scope of practice. Service orders are valid for one calendar year and medical necessity must be revisited and reordered at least annually. Service orders must not be backdated and must be signed and dated by the authorizing professional indicating the date the service was ordered. A service order must be in place prior to or on the first day the service is initially provided in order to bill Medicaid; retroactive eligibility does not permit billing without a valid service order.
- Authorized signers include qualified professionals, licensed behavioral health clinicians, licensed psychologists, physicians, nurse practitioners, and physician assistants.
- Service order validity: 1 calendar year; must be revisited at least annually.
- No backdating; must be signed and dated and in place on or before the first service date.
Service documentation and required elements
Each service contact or intervention requires a full service note that documents the nature and course of treatment and supports billed services. Service notes must include all required elements and be signed and dated by the staff who provided the service.
- Required service note elements: beneficiary name; Medicaid ID; date of service; name of service; type of contact (in-person, phone, collateral); place of service; purpose of contact related to Career Profile and care plan goals; description of interventions with duration/time; assessment of effectiveness and progress toward goals; date, signature, and credentials/title of staff; each page identified with beneficiary name, Medicaid ID and record number.
Documentation and recordkeeping
Providers must comply with HIPAA, record retention requirements, and all applicable NC Medicaid clinical coverage and billing guides, bulletins, fee schedules, and implementation updates. Records must support billed services and be retained according to applicable policies and regulations.
- Comply with HIPAA and record retention requirements.
- Follow NCTracks Provider Claims and Billing Assistance Guide, Medicaid bulletins, fee schedules, and clinical coverage policies for claims and reimbursement guidance.
Referral to vocational services
At initiation of IPS, providers must refer the beneficiary to the Division of Vocational Rehabilitation Services (DVRS) or Vocational Opportunities of Cherokee for eligibility determination of employment services.
- Referral to DVRS or Vocational Opportunities of Cherokee must be made at the start of IPS services.
Providers must ensure that IPS is billed only when employment services and supports are provided directly to or on behalf of the beneficiary. IPS cannot be billed for meetings, paperwork, documentation, or travel time. A beneficiary may receive IPS from only one provider organization during an episode of care, and IPS must not be provided during the same episode of care as Assertive Community Treatment (ACT). IPS staff must spend 65% or more of total scheduled work hours in the community and frequency/intensity of services must be documented in the Career Profile.
- IPS billing limited to direct employment services to the beneficiary; administrative tasks and travel are not billable.
- Only one provider organization may deliver IPS during an episode of care.
- IPS staff community time requirement: ≥ 65% of scheduled work hours; document frequency and intensity in Career Profile.
Background and Definitions
Individual Placement and Support (IPS) is an evidence-based supported employment model that focuses on rapid job search and placement in competitive employment for beneficiaries with significant behavioral health needs. IPS is person-centered, integrates with behavioral health treatment, follows the SE/IPS fidelity model, applies a zero-exclusion policy, and provides individualized, time-unlimited supports including job development, on-the-job follow-along, benefits counseling, and peer mentoring to help beneficiaries achieve measurable employment outcomes.
Level of Care / Service Setting Criteria
Supported Employment Modalities and IPS Services
IPS supported employment
Supports: chunk 8
IPS (supported employment)
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Individual Placement & Support (IPS)
chunks 51,53
Supported Employment / IPS (Place of Service)
Section on Place of Service (chunk 65)
Limits, Caseloads, and Service Restrictions
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