NC Medicaid Assertive Community Treatment (ACT) Program
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Defines NC Medicaid coverage, eligibility, service requirements, staffing, fidelity monitoring, and billing rules for Assertive Community Treatment (ACT) teams for beneficiaries aged 18 and older; applies to providers billing NC Medicaid under this policy.
Amended Date: January 1, 2025 appears in multiple sections indicating an update to the policy.
All initial required trainings must be completed within the first 120 calendar days of hire; annual cross-training requirement of three hours per year per staff member (excluding program assistant).
Language referencing prior approval, authorizations, initial authorizations, and reauthorizations was revised to comply with the Mental Health Parity and Addiction Equity Act and 42 CFR § 438.900.
Requirement that ACT teams be evaluated using the Tool for Measurement of ACT (TMACT) or its DHHS-approved successor for fidelity monitoring.
Teams must regularly submit standardized outcome data through the ACT Monitoring Application (including beneficiary satisfaction, treatment adherence, vocational/educational gains, reduced inpatient use, improved physical health, etc.).
Coverage and Medical Necessity Criteria
inv-01: When ACT Services Are Covered
Covered when ALL of the following are met:
Section 3.0 criteria referenced but not fully reproduced in this extract
inv-02: Initial admission criteria
Medicaid shall cover ACT services when ALL of the following are met:
inv-03: Continued stay criteria
Medicaid shall cover continued stay when the desired outcome or functioning has not been restored, improved, or sustained and ONE of the following applies:
inv-04: Discharge and transition criteria
Transition or discharge occurs when at least one applies
inv-05: Concurrent services
Concurrent services that may be provided only if medically necessary:
inv-06: Billing Preconditions
Covered when ALL of the following are met
inv-07: PCP and CCA Preconditions and Review
Covered when ALL of the following are met
inv-08: Provider, Team Staffing, and Program Size Criteria
Covered when ALL of the following are met
inv-09: Certification and Fidelity Evaluation
Covered when ALL of the following are met
inv-10: ACT Team Staffing and Provider Qualifications
Staffing, qualifications, and role fulfillment required for ACT program operation
inv-11: Covered ACT Services and Interventions
Service content and intervention requirements
inv-12: Core coverage and program operation criteria
Covered when staff roles, qualifications, training, and service intensity meet program requirements
inv-13: Service Frequency and Duration
Service frequency and intensity expectations (team-level caseload averages)
inv-14: ACT Program Fidelity Monitoring
Fidelity monitoring requirement
inv-15: Expected Clinical Outcomes
Expected outcomes to be tracked via ACT Monitoring Application
inv-16: Per-diem Coverage Criteria
Coverage of ACT per-diem (H0040) and service expectations
inv-17: Place-of-Service and Community Delivery
Place-of-service and community delivery standards
inv-18: Operational and Crisis Response Criteria
Operational availability and crisis response
Beneficiaries whose Medicaid eligibility category imposes service restrictions that disallow provision of this service are not eligible for ACT. Providers must verify each beneficiary's NC Medicaid eligibility at every service encounter; documented eligibility restrictions that preclude ACT make the beneficiary ineligible for billing under this policy.
Services are not covered when the beneficiary fails to meet the eligibility requirements in Section 2.0 or the clinical criteria in Section 3.0, when the procedure duplicates another provider's service, or when the procedure/product/service is experimental, investigational, or part of a clinical trial. Time spent in recreational activities unless tied to a specific PCP therapeutic goal, services not identified on the beneficiary's treatment plan, and services provided to family members for issues not directly related to the beneficiary are examples of non-covered activities.
Services provided to teach academic subjects or to substitute for educational personnel (for example, a teacher, teacher's aide, or academic tutor) are not covered under the ACT per-diem and may not be billed as ACT activities.
Habilitative services intended to help an adult acquire, retain, or improve self-help, socialization, or adaptive skills for successful community residence are excluded from ACT coverage and may not be billed under the ACT per-diem.
Childcare services, or services provided as a substitute for the parent or other individuals responsible for care and supervision, are not covered under ACT and must not be billed as ACT activities.
Respite care is explicitly listed as not covered and cannot be billed as part of ACT team services.
Transportation for the individual or family is not covered under ACT; services delivered in a moving vehicle are considered transportation and are excluded from ACT billing.
ACT services are intended for adults; services provided to beneficiaries under age 18 are not covered under this adult ACT policy and must not be billed as ACT.
Claims for services that have not been rendered will not be covered. Providers must maintain documentation that each billed ACT service was actually provided and that the record supports medical necessity.
Any art, movement, dance, or drama therapies are not covered as ACT activities and must not be billed under the ACT per-diem.
Any service not specifically covered in Section 3.0 of this policy is excluded from ACT coverage and cannot be billed under the ACT per-diem.
Clinical and administrative supervision of staff is an excluded activity and is not billable under the ACT per-diem; supervision time must be documented separately and may not be claimed as ACT direct service.
Individuals whose primary diagnosis is a substance use disorder, intellectual or developmental disability, autism spectrum disorder, personality disorder, or traumatic brain injury (in the absence of a co-occurring qualifying psychiatric disorder) are not intended beneficiaries for ACT under this policy and are excluded from ACT coverage.
Backdating of service orders is not allowed. A service order must be signed and dated by an MD/DO, Licensed Psychologist, NP, or PA and must be in place prior to or on the day the service is first provided; services provided without a valid service order cannot be billed to Medicaid even if the beneficiary later becomes retroactively eligible.
The psychiatric care provider's required community-based activities cannot be fulfilled via telemedicine or telepsychiatry for the purposes of this community-based service. Use of telemedicine/telepsychiatry to meet the psychiatric care provider role is not covered under the ACT program.
Psychiatric care provider duties that require in-person community-based engagement are not satisfied by telepsychiatry; therefore, psychiatric services delivered solely via telemedicine are excluded from coverage for the ACT psychiatric care provider role.
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For Medicaid beneficiaries, ACT team services may not be provided in an Institute for Mental Diseases (IMD) or in other public institutional settings (for example, jail, detention center, or prison). ACT services are intended to be delivered in the beneficiary's natural environment.
Examples of activities that are explicitly not billable as ACT include: services to family members addressing issues not related to the beneficiary; recreational activities unless directly tied to a PCP therapeutic goal; academic instruction or substitution for educational personnel; and habilitative services for adults to acquire or improve self-help, socialization, or adaptive skills.
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Codes, Billing Units, and Key Numeric Criteria
| No codes listed |
| CMS-1500/837P | Professional claim form/transaction |
| ICD-10-CM/PCS | Report to highest level of specificity in current edition |
| H0040 | Assertive Community Treatment (per diem) |
Provider Responsibilities, Documentation, and Billing Rules
Prior Approval Requirements (policy sections exist)
Prior approval is addressed in the policy headings and prior approval requirements sections. Providers should note the policy includes Prior Approval and Prior Approval Requirements sections and follow any instructions therein.
Prior approval still applies for beneficiaries under 21 (EPSDT)
If a service requires prior approval, beneficiaries under age 21 remain subject to prior approval requirements; EPSDT status does not eliminate prior approval when the service requires it.
No prior approval required for ACT services
Medicaid does not require prior approval for ACT services; the policy explicitly states none apply for general or specific prior approval requirements.
Maintain a valid service order and demonstrate medical necessity
A written service order by an MD/DO, Licensed Psychologist, Nurse Practitioner, or Physician Assistant is required to demonstrate medical necessity; service orders must be signed, dated, cannot be backdated, must be in place prior to or on the first day of service, and are valid for one year with annual revision of medical necessity.
Document Table 1 staffing and psychiatric FTE compliance
Document and maintain staffing that meets Table 1: psychiatric care provider minimum FTE and team staffing levels must meet the Table 1 requirements based on team size; staffing must be documented to demonstrate compliance.
Prior authorization: not specified
The policy does not specify a separate prior authorization process in this section; prior authorization is not described.
Authorization/utilization management language revised for parity and CFR compliance
Policy language referencing prior approvals, authorizations, initial authorizations, and reauthorizations was revised to comply with the Mental Health Parity and Addiction Equity Act and 42 CFR § 438.900; providers should follow the updated language.
H0040 per-diem billing: bill only for qualifying face-to-face contacts
Bill H0040 per-diem only on days the ACT team performed a face-to-face service meeting policy requirements; a qualifying per-diem requires a 15-minute face-to-face contact (defined as at least 8 minutes).
- Only one per diem may be billed per beneficiary per day.
- Collateral contacts may only account for up to 25% of the team's time.
- Practitioners may not bill separately for services that are included in the H0040 per diem.
Reserved (no requirement specified)
Reserved placeholder; no source text provided for this inventory item.
Document lack of equally effective, less costly alternatives
Coverage requires documentation that no equally effective, more conservative, or less costly statewide alternative exists and that alternatives would not be equally or more effective based on NC community practice standards and the LME-MCO service array.
Do not provide ACT concurrently with specified services
ACT services must not be provided concurrently with the listed services (for example: individual, group, or family outpatient; outpatient medication management; outpatient psychiatric services; mobile crisis; psychosocial rehabilitation after a 30‑day transition; community support team; partial hospitalization; tenancy support services; nursing home facility; or Medicaid-funded IPS-supported employment or long-term vocational supports).
Reserved (no requirement specified)
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Sequence therapeutic approaches: collaboration first, limit-setting only if needed
Use collaborative and motivational interventions first; therapeutic limit-setting should be used only for a short time when collaborative approaches fail and risks are high.
Step therapy: not specified / not applicable in excerpt
Step therapy for medications or specific therapies is not applicable or not specified in the provided policy excerpt.
Reserved (no requirement specified)
Reserved placeholder; no source text provided for this inventory item.
Reserved (no requirement specified)
Reserved placeholder; no source text provided for this inventory item.
Document full signed service notes with required elements
Providers are responsible for documentation: service notes must be written and signed by the staff who provided the service and include beneficiary name, Medicaid ID, date, service name, type of contact, purpose tied to PCP goals, description of interventions, duration, assessment of effectiveness/progress, place of service, and staff signature with credentials or job title.
Complete a CCA demonstrating medical necessity before services
A comprehensive clinical assessment (CCA) demonstrating medical necessity must be completed prior to provision of ACT services and relevant diagnostic information must be included in the Person-Centered Plan.
Ensure CCA and PCP are in place before billing; PCP within 15 days
Before any service can be billed, a written CCA and an order for medical necessity must be in place; the Person-Centered Plan must be completed within 15 calendar days of the service start date.
Service note must include all specified content elements
For each contact, providers must document a full signed service note that includes beneficiary identifiers, date, service provided, place of service, duration, description of intervention, assessment of effectiveness/progress, purpose related to PCP goals, type of contact, and staff signature with credentials or job title.
Include required elements in discharge/transition documentation
Discharge or transition documentation must include beneficiary- and team-stated reasons, the beneficiary's biopsychosocial status at discharge, a written final evaluation summary of progress toward PCP goals, a follow-up treatment plan, signatures of the beneficiary, team leader, and psychiatrist, and submission of the LME-MCO Consumer Admission and Discharge Form.
Maintain PCPs, risk/crisis plans, and treatment response monitoring
Maintain person-centered plans, risk assessments, crisis plans, monitoring of treatment response, and standardized assessments of transition readiness; update plans with the beneficiary and document outreach, engagement, family coordination, and relapse prevention planning.
Keep a Beneficiary Log and Daily Team Schedule documenting contacts and status
Maintain a Beneficiary Log documenting whether a beneficiary was seen or attempted to be seen, notable clinical comments, medication and intervention response, and housing status; use the Daily Team Schedule derived from PCPs.
Retain training and supervision records; ensure bi-weekly supervision
The Team Leader must maintain documentation of supervision and training activities, including cross-training; the majority of staff shall receive scheduled clinical supervision bi-weekly and no staff shall go without a supervision session in a given month.
Maintain documentation and coding specificity to support billed services
Maintain documentation supporting medical necessity and accurate billing: beneficiary identifiers, dates of service, procedure codes, units billed, and supporting documentation; report ICD-10-CM/PCS to highest specificity and use current editions.
- Use current CPT/HCPCS/UB-04; 1 unit = 1 event.
- Follow modifier and unlisted procedure reporting instructions.
Report diagnoses to highest specificity and ensure documentation quality
Report ICD-10-CM/PCS to the highest level of specificity in effect at the time of service; ensure documentation relates to PCP goals and follows standards of accuracy, timeliness, objectivity, specificity, consistency, comprehensiveness, and clarity.
Use current code manuals; 1 unit = 1 event
Follow current CPT/HCPCS/UB-04 guidance for code and unit reporting; 1 unit equals 1 event and providers must follow unlisted procedure and modifier instructions.
Verify eligibility; eligibility category may render beneficiary ineligible
Beneficiaries may be ineligible for ACT services due to their Medicaid eligibility category; providers must verify eligibility at each service and confirm no eligibility-based restrictions apply.
Risk of denial if services fail eligibility or coverage criteria
Services that do not meet Section 2.0 eligibility or Section 3.0 criteria, duplicate other providers' services, or are experimental/investigational or part of a clinical trial are not covered and risk denial.
Do not bill for services not rendered
Claims for services that were not rendered will not be covered; providers must ensure services billed were actually provided.
Claims require a valid service order in place on or before first service date
Claims submitted without a valid service order in place prior to or on the day the service was first provided cannot be billed to Medicaid; backdating of service orders is not allowed.
Missing or backdated service order will result in claim denials
Billing Medicaid without a valid service order in place prior to or on the day the service was initially provided will result in denied claims; providers cannot bill even if beneficiary later becomes retroactively eligible.
Telepsychiatry does not satisfy psychiatric care provider community-based duties
Psychiatric care provider duties required by the ACT team cannot be fulfilled via telemedicine or telepsychiatry; such activities delivered via telemedicine are not covered for this community-based service.
Psychiatric care provider activities must be provided in person (telepsychiatry excluded)
Telemedicine/telepsychiatry is not acceptable to meet the psychiatric care provider role for this community-based service; psychiatric activities must be provided in person as part of team integration.
Audit findings may lead to financial recoupment or withholding
Audit findings of billing or documentation deficiencies are forwarded to NC Medicaid's Program Integrity Section and may result in requests for refunds or withholding from future payments; providers must maintain accurate documentation to avoid recoupment.
Per-diem billing allowed only for qualifying face-to-face service days
Per diems may only be billed on days when a qualifying face-to-face service occurred; only one per diem per beneficiary per day is allowed and a 15-minute contact (at least 8 minutes) is required to generate the per diem.
- Collateral contacts may account for up to 25% of team time.
- Only one per diem may be billed per beneficiary per day.
Do not bill separately for services included in the H0040 per diem
Practitioners may not bill separately for services that are included in the ACT per diem (H0040); those services are considered part of the per diem and must not be billed outside the per-diem rate for beneficiaries enrolled in ACT.
Limit collateral contacts to no more than 25% of team time
Collateral contacts may only comprise up to 25% of the ACT team's time; providers must ensure the team's time allocation complies with this limit.
Background and Definitions
Assertive Community Treatment (ACT) is a team-based, community-focused service model for adults with severe and persistent mental illness who do not benefit from multiple disconnected providers and are at higher risk of hospitalization, homelessness, substance use, victimization, or incarceration. ACT provides person-centered, recovery-oriented services as the primary—and often sole—source of care, using assertive engagement, high contact frequency, and a multidisciplinary team delivering services in beneficiaries' natural environments.
Level of Care and Placement Criteria
inv-103: Community-based / ACT
inv-104: Community-based intensive outpatient / ACT team
inv-105: Community-based ACT
inv-106: Community-based ACT
inv-107: Community-based ACT team
inv-108: Community-based ACT team
inv-109: Community-based ACT program
Permitted Modalities, Interventions, and Service Types
inv-110: ACT team services
inv-111: Psychosocial Rehabilitation (PSR)
inv-112: ACT team biopsychosocial interventions
inv-113: Psychotherapy, CBT, Motivational Interviewing, IMR/WRAP
inv-114: Medication management, integrated dual disorders treatment, IPS-supported employment, peer-delivered recovery supports
inv-115: Community outreach, crisis response, rehabilitation
Visit Counting, Caseloads, and Per-diem Limits
Policy Updates and Material Changes
Material policy amendments effective Jan 1, 2025 updating service content (family supports, integrated dual disorders treatment, vocational and tenancy supports) and restating the amended date throughout the document.
Clarified initial DHHS-approved training requirements to be completed within 120 calendar days of hire and added annual 3 hours of cross-training per staff member (excluding program assistant).
Updated ACT team staffing tables and psychiatric care provider FTE expectations with detailed role/FTE guidance for small, mid-size, and large teams.
Added requirement that ACT programs be evaluated using the Tool for Measurement of ACT (TMACT) or a DHHS-approved successor for fidelity monitoring.
Multiple administrative updates including template language changes, coding guidance, and explicit prohibition of reimbursement for conversion therapy (recorded in change log).
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