Psychiatric Residential Treatment Facilities (PRTF) services for youth
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Covers medical necessity, eligibility, admission, continued stay, and discharge criteria for Psychiatric Residential Treatment Facility services for NC Medicaid beneficiaries under 21 (with continued care until 22 when medically necessary). Applies to providers billing NC Medicaid/PHPs.
Added utilization management language to clarify service requirements to ensure compliance with the Mental Health Parity and Addiction Equity Act and the Code of Federal Regulations Title 42 § 438.900.
Compliance subsection updated to add 'equivalent federal Tribal code' and 'or federally equivalent tribal code or allowance.'
Medicaid-specific language removed about utilization review contractor notifying the fiscal agent of approved certified days.
Added statements that federally recognized tribal and Indian Health Service providers may be exempt from some items or entitled to alternate reimbursement methodologies under Federal Law and regulations.
Coverage Criteria for PRTF Services
inv-01: Admission / Initial Therapy
Covered when ALL of the following general and specific criteria are met
From general criteria (3.1)
Admission criteria (3.2.1)
inv-02: Continuation Therapy / Continued Stay
Continued stay requires ALL of the following
Continued stay requirements (3.2.2)
inv-03: Discharge Criteria
Discharge requires BOTH 'a' and 'b' below, plus one or more of 'c' through 'g'
Both required (3.2.3)
One or more required (3.2.3)
inv-04: Covered PRTF services
Covered when ALL of the following are met
Medical necessity verified by utilization management (5.3.1; 4.1)
Prior approval required (5.1, 5.3.1)
CON requirements (5.3.2)
Medicaid Additional Criteria: None apply. This policy does not impose any additional Medicaid-specific admission or coverage criteria beyond those set forth in Sections 2.0 and 3.0.
Services not covered when they duplicate another provider's service or are experimental/investigational: Medicaid will not cover procedures, products, or services that duplicate another provider's procedure, product, or service or that are experimental, investigational, or part of a clinical trial. Providers should ensure services billed under this policy are distinct, medically necessary, and supported by documentation of clinical need.
General non-coverage triggers: Services are not covered when the beneficiary does not meet the eligibility requirements in Section 2.0 or does not meet the clinical criteria in Section 3.0. Additionally, services are not covered if they duplicate another provider's service, are experimental/investigational or part of a clinical trial, or when PRTF placement is court-ordered but does not meet medical necessity or is driven primarily by social/economic placement issues.
Conversion therapy: North Carolina Medicaid will not reimburse for conversion therapy. This treatment is explicitly excluded from reimbursable services under this policy.
Not medically necessary — general rule: Services are considered not medically necessary and therefore not payable when the beneficiary fails to meet Section 2.0 eligibility or the clinical Section 3.0 medical necessity criteria, or when the service is duplicative or experimental/investigational. Claims lacking documentation that demonstrates eligibility and medical necessity are subject to denial.
Court-ordered PRTF services: PRTF services that are ordered by a court but do not meet the policy's medical necessity criteria are not covered. Services ordered for primarily social or economic reasons (for example, placement) are likewise not eligible for Medicaid reimbursement.
Coding and Billing Codes
| No codes listed |
| RCC 911 | Revenue code to be billed in form locator 42 as one unit per day |
| CPT unlisted | Use appropriate unlisted CPT procedure code and submit Special Report when no specific CPT exists |
| HCPCS unlisted | Use appropriate unlisted HCPCS National Level II code and Special Report when no specific HCPCS exists |
| ICD-10-CM codes | Report ICD-10-CM to highest level of specificity supporting medical necessity |
Provider Requirements, Prior Authorization, and Documentation
EPSDT and Prior Approval (Reminder)
If the service requires prior approval, the beneficiary being under 21 does NOT eliminate the prior approval requirement. Consult NCTracks Provider Claims and Billing Assistance Guide and the NC DHHS EPSDT provider page for additional guidance on EPSDT-related prior approval considerations.
- NCTracks Provider Claims and Billing Assistance Guide: https://www.nctracks.nc.gov/content/public/providers/providermanuals.html
- EPSDT provider page: https://medicaid.ncdhhs.gov/
Prior Authorization Required
Prior approval is required and must be obtained before providing Psychiatric Residential Treatment Facility (PRTF) services. Submit the prior approval request and all supporting health records to the Department of Health and Human Services (DHHS) Utilization Review Contractor as specified by NC Medicaid policy.
- Include the prior approval request form and all health records supporting the beneficiary meets the criteria in Section 3.2.
- For beneficiaries under 21, include documentation that EPSDT criteria are met and evidence-based literature supporting the request, if available.
Initial Authorization Documentation and Concurrent Review
Initial authorization requires submission of the Certification of Need (CON), a Comprehensive Clinical Assessment (CCA) or Diagnostic Assessment (DA), the Person-Centered Plan (PCP), and the required NC Medicaid authorization request form to the utilization management contractor. Concurrent reviews determine ongoing medical necessity; providers must submit updated PCPs and any reauthorization forms required by the utilization management contractor.
- CON must be completed on or prior to admission, by an independent medical team including a qualified physician, and cannot be retroactive.
- A copy of the CON must be maintained in the beneficiary's medical record.
- The last dated signature on the CON form determines authorization for payment.
Prior Authorization for Outpatient-to-Inpatient Visits
Outpatient providers who see an inpatient beneficiary to facilitate treatment or transition back to outpatient care must obtain prior authorization from NC Medicaid's Utilization Review vendor to be reimbursed for those visits.
- Obtain prior authorization from NC Medicaid's Utilization Review vendor before providing and billing for outpatient visits to an inpatient.
Billing Form Locator Requirement
Failure to bill the required revenue code or to follow institutional billing guidance may lead to claim denial or improper reimbursement. Providers must follow NCTracks and National Uniform Billing Guidelines when submitting institutional claims.
- Institutional claims must be billed using the UB-04/837I transaction and comply with National Uniform Billing Guidelines.
- Bill RCC 911 in form locator 42 as one unit per day for PRTF bed days.
Claim Type and Diagnosis/Procedure Coding Specificity
Claims must be submitted using the Institutional claim type (UB-04/837I) and include ICD-10-CM/PCS codes and procedure codes reported to the highest level of specificity that supports medical necessity. Use current editions of ICD-10, CPT, HCPCS, and UB-04 Data Specifications Manual in effect at the time of service.
- Report ICD-10-CM and PCS to the highest level of specificity that supports medical necessity.
- Use the most specific CPT/HCPCS code available; if none exists, use the appropriate unlisted procedure code.
- Ensure institutional claims follow National Coding Guidelines and NCTracks guidance.
Background and Scope
Background: Psychiatric Residential Treatment Facilities (PRTFs) provide non-acute, inpatient behavioral health care with 24-hour supervision and specialized therapeutic interventions for youth whose mental health or substance use conditions require a highly structured residential environment. PRTF services emphasize rehabilitative counseling, life skills development, medication adherence support, coordination with family and outpatient providers, and individualized treatment planning. Coverage is contingent on meeting eligibility, documented medical necessity, required authorization (including Certification of Need for Medicaid-eligible beneficiaries), and submission of supporting assessments and person-centered plans.
Definitions and Terms
Level of Care Criteria and Facility Definitions
inv-41: Inpatient (Psychiatric Residential Treatment Facility)
Level of care criteria (3.2.1)
inv-42: Psychiatric Residential Treatment Facility (PRTF)
PRTF-specific requirements (5.3.2; 5.3.1)
inv-43: Residential Treatment Facility / Inpatient
Residential/inpatient documentation and requirements (5.3.3; 7.2)
Treatment Modalities and Transitions
inv-44: Comprehensive residential behavioral health treatment
Comprehensive residential behavioral health treatment (3.2.2)
inv-45: Therapeutic leave
Therapeutic leave limits and documentation (5.3.3)
inv-46: General behavioral health inpatient/outpatient transition care
Outpatient‑to‑inpatient transition reimbursement guidance (H. Reimbursement)
Therapeutic Leave and Visit Limits
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