Mental Health/Substance Abuse Targeted Case Management (MH/SA TCM)
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Defines Medicaid coverage, expectations, and provider requirements for targeted case management services for beneficiaries with serious emotional disturbance, mental illness, or substance-related disorders in North Carolina.
No material clinical or coverage changes in this revision.
Coverage Criteria and Limits
Covered Services (General) (inv-01)
Covered when ALL of the following are met:
Age of adulthood varies by funding source; Medicaid adult services begin at age 21 unless EPSDT applies.
Functions: assessment, person-centered planning, referral/linkage, monitoring and follow-up.
Provider qualifications and documentation requirements are detailed elsewhere in the policy.
EPSDT Coverage Exceptions (inv-02)
EPSDT provisions (beneficiaries under 21):
EPSDT may allow exceeding policy limits if provider documentation supports medical necessity.
If a service normally requires prior approval, EPSDT does not eliminate that requirement.
Covered — Initial Eligibility and Coverage (inv-03)
Medicaid covers MH/SA TCM when BOTH general and specific criteria are met
From Section 3.1.
From Section 3.2.1.
From Section 2.3.2.
Covered — Continued Service (inv-04)
Continued service covered when ALL the following are met
From Section 2.3.3.
Discharge Criteria (inv-05)
Discharge occurs when ANY of the following apply
From Section 2.3.4.
Medical Necessity / Coverage Criteria (inv-06)
Covered when ALL of the following are met
See provider qualifications for acceptable provider types and Date of Plan validity guidance.
From Sections 6.0 and 6.1.
Service is billed on a weekly case rate basis.
Coverage contingent on compliance (inv-07)
Provider compliance and eligibility for coverage require adherence to the following administrative and documentation requirements
Compliance supports eligibility for reimbursement and services are subject to audits and potential recoupment for deficiencies.
EPSDT protections apply to Medicaid beneficiaries under age 21. Under EPSDT (42 U.S.C. § 1396d(r)), the state must cover services that are medically necessary to correct or ameliorate a condition identified through screening, and may allow exceeding policy limits when provider documentation supports medical necessity. However, EPSDT does not require coverage of services that are unsafe, ineffective, experimental or investigational, or not medical in nature.
The policy explicitly lists specific services that are not covered under MH/SA TCM. Examples include transportation time and transportation services, any treatment interventions such as habilitation or rehabilitation activities, and social or recreational activities (or their supervision). Also excluded are clinical and administrative staff supervision (including team meetings), writing assessment reports, person-centered plans, or service notes, and service record reviews.
Providers should note these exclusions apply even when case management activities occur in community settings; excluded items may not be billed as MH/SA TCM.
MH/SA Targeted Case Management cannot be provided during the same episode of care as certain other intensive programs, including In-Home Services, Community Support Team, Assertive Community Treatment Team, Multisystemic Therapy, Child and Adolescent Day Treatment, Substance Abuse Intensive Outpatient Program, Substance Abuse Comprehensive Outpatient Treatment, and Substance Abuse Non-Medical Community Residential Treatment. Additionally, beneficiaries receiving MH/SA TCM may not receive other Medicaid-reimbursable case management services during the same period (for example, CAP, At-Risk Case Management, or TCM for Intellectual Disabilities).
Federal rules restrict Federal Financial Participation for services delivered to inmates of public institutions and certain patients in Institutions for Mental Diseases (IMDs). As a result, services provided to inmates or IMD patients may be excluded from FFP and are subject to the statutory exceptions and limitations identified in federal regulations.
Federal Medicaid and SCHIP rules prohibit Federal Financial Participation payment for services delivered to inmates of public institutions and for certain patients in Institutions for Mental Diseases except as specifically allowed by statute or regulation. Where these prohibitions apply, reimbursement for services in those settings is paid with state-only funding rather than federal matching funds.
MH/SA TCM is not covered when the beneficiary fails to meet eligibility requirements in Section 2.0 or the coverage criteria in Section 3.0. Coverage is also denied when the service would duplicate another provider's procedure, product, or service, or when the procedure, product, or service is experimental or investigational.
Codes, Billing Units, and Visit Minimums
| H0032 | Mental health service plan development by nonphysician |
| No codes listed |
Provider Requirements, Documentation, and Authorization
Prior Approval — EPSDT Exception
EPSDT beneficiaries under 21 remain subject to prior approval when the service requires it; EPSDT does not eliminate prior approval requirements for services that require prior approval.
- See NCTracks Provider Claims and Billing Assistance Guide and EPSDT provider page for additional EPSDT/prior approval guidance: https://www.nctracks.nc.gov/content/public/providers/providermanuals.html; https://medicaid.ncdhhs.gov/
Prior Authorization Guidance
MH/SA Targeted Case Management (TCM) does not require prior authorization in general; however, EPSDT beneficiaries under 21 must follow prior approval processes when the requested service itself requires prior approval.
- Medicaid shall not require prior approval for MH/SA TCM (non-EPSDT exception).
- If a particular service or procedure associated with the case management plan requires prior approval, follow NCTracks and EPSDT procedures.
Signed Service Order Required
A signed service order is required prior to or on the day the service is initially provided. The order must be completed and signed by an authorized clinician (physician, licensed psychologist, physician assistant, or nurse practitioner) and be based on a comprehensive clinical assessment. Service orders are valid for one year from the Date of Plan on the PCP and must be reviewed at least annually.
- Service order must include signature, credentials, and date of order.
- Order must be based on a comprehensive clinical assessment of the beneficiary's needs.
- Service orders valid for one year from Date of Plan; review medical necessity annually.
Prior Approval/Authorization Removed
Language referencing prior approvals, authorizations, reauthorizations, and utilization management has been removed for MH/SA TCM per policy revision; prior approval is not required for MH/SA TCM except where EPSDT or another service rule explicitly requires it.
- Removed references to utilization management, initial authorizations, and reauthorizations for MH/SA TCM.
- Prior approval/authorization language removed from general MH/SA TCM authorization requirements.
Eligibility Verification
Providers must verify each beneficiary's Medicaid eligibility at every service encounter. Failure to verify eligibility may result in claim denial.
- Verify Medicaid eligibility each time a service is rendered; beneficiary eligibility category may restrict coverage.
Denial Triggers
Claims may be denied if the beneficiary does not meet Section 2.0 eligibility, Section 3.0 coverage criteria, if the service duplicates another provider's service, or if the procedure/product/service is experimental or investigational.
- Denial triggers include: not meeting eligibility (Section 2.0), not meeting coverage criteria (Section 3.0), duplication of services, or experimental/investigational status.
Billing Activity and Contact Requirements
To bill for weekly case management, documentation must show at least 15 minutes of weekly case management activity across assessment, person-centered planning, linking, or monitoring. A minimum monthly face-to-face contact with the beneficiary is required. Billing without documentation of these activities or without the monthly face-to-face contact may be denied.
- At least 15 minutes of documented weekly case management activity is required to bill the weekly case rate (1 unit per calendar week).
- Minimum monthly face-to-face contact is required; weekly activities may be non-face-to-face.
- Insufficient documented activity or missing monthly face-to-face contact are grounds for denial.
Audit Findings and Potential Recoupment
Deficiencies identified during audits (including billing errors, incorrect beneficiary identifiers, procedure code or unit errors, or inadequate documentation) will be reported to NC Medicaid Program Integrity and may result in recoupment, refund requests, or withholdings from future payments.
- Audit findings forwarded to NC Medicaid's Program Integrity Section with supporting documentation.
- Refunds or withholdings should be sent to Office of Controller NC Medicaid Accounts Receivable.
Funding Ineligibility — Inmates and IMD Patients
Claims for services delivered to inmates of public institutions or certain IMD patients may be ineligible for Federal Financial Participation; such services may be paid with state-only funds where federal participation is prohibited.
- Federal Medicaid laws prohibit FFP payment for services to inmates of public institutions unless the beneficiary is a patient in a medical institution.
- FFP prohibitions for IMD patients may apply; 100% state funding may be required in those settings.
Required Documentation and Orders
Providers must complete and maintain required documentation: a comprehensive clinical assessment documenting medical necessity prior to service, the LME Consumer Admission and Discharge Form as required, and a full service note for each contact or date of service. Service notes must include beneficiary identifiers, service details, date and place of service, type and purpose of contact, description of activities, time spent, outcomes/next steps, and signature with credentials. A documented discharge plan must be included in the service record.
- Comprehensive clinical assessment documenting medical necessity is required prior to service.
- Submit Local Management Entity (LME) Consumer Admission and Discharge Form.
- Full service note content requirements: beneficiary name, Medicaid ID, service record number, service provided, date, place, contact type and purpose, activity description, time spent, results/outcomes, signature and credentials.
- Case manager providing the service must sign and include credentials.
Compliance and Recordkeeping
Providers must comply with all applicable agreements, federal, state and local laws (including HIPAA), record retention requirements, NC Medicaid clinical coverage policies, guidelines, provider manuals, implementation updates, and bulletins. Providers must also follow NCTracks billing guidance and applicable coding rules.
- Comply with HIPAA and record retention requirements.
- Follow NCTracks Provider Claims and Billing Assistance Guide and NC Medicaid clinical coverage policies for coding and reimbursement.
- Report ICD-10-CM and PCS coding to highest level of specificity supporting medical necessity.
Background and Scope
Targeted case management for mental health and substance abuse assists eligible Medicaid beneficiaries to access necessary medical, behavioral, social, and other services. It is a person-centered, strengths-based service focused on individualized assessment, person-centered planning, referral/linkage, and monitoring/follow-up. Services are tailored to beneficiary needs, periodically reassessed, and coordinated with primary care and specialty providers to support engagement and improved outcomes.
Key Definitions
Level of Care / Service Setting Criteria
Treatment Modalities and Service Components
Case management / care coordination (inv-55)
Referral and linkage functions are central to case management modality.
Case Management (inv-56)
From Section 5.2.2 and service limitations in 5.3.1.
Targeted Case Management (TCM) (inv-57)
Billed on weekly case rate; weekly activity must reflect at least 15 minutes per week.
Case Management / Person-Centered Planning (inv-58)
These are competency expectations rather than service-specific clinical criteria.
Visit Frequency, Units, and Billing Periods
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