HHS Selects 10 States to Participate in Medicaid Behavioral Health Clinic Demonstration

Today, the U.S. Department of Health and Human Services (HHS) announced 10 new states have been selected to participate in the Certified Community Behavioral Health Clinic Medicaid Demonstration – Alabama, Illinois, Indiana, Iowa, Kansas, Maine, New Hampshire, New Mexico, Rhode Island and Vermont.

The Certified Community Behavioral Health Clinic (CCBHC) Medicaid Demonstration was created in 2014 under the Protecting Access to Medicare Act. The demonstration program provides participating states with enhanced federal Medicaid matching funds (equivalent to a state’s Children’s Health Insurance Program (CHIP) enhanced federal medical assistance percentage) for eligible CCBHC services provided to individuals covered by Medicaid. As part of the CCBHC Medicaid Demonstration, states are required to establish prospective payment systems for Medicaid services delivered at CCBHCs and ensure CCBHCs meet federal standards such as providing 24-hour crisis services and routine outpatient care, ensuring that services for children and youth are family-centered, youth-guided, and developmentally appropriate, and serving anyone who requests care for mental health or substance use, regardless of their age or ability to pay. According to a 2021 HHS report examining the initial demonstration states, nearly a quarter of CCBHC clients were children or adolescents (ranging from 8% to 27% depending on the demonstration state).

Initially limited to eight states (and subsequently expanded to 10 states), the Bipartisan Safer Communities Act opened participation in the CCBHC Medicaid Demonstration to all interested states under a phased-in approach under which 10 new states will be allowed to participate in the four-year demonstration program every two years starting this year. In March 2023, HHS announced that it awarded 15 states each with $1 million, one-year CCBHC planning grants in support of state efforts to join the Medicaid-funded demonstration program. In its announcement, HHS notes that a notice of funding opportunity to award 15 additional states with planning grants is expected to be posted this summer for award early in fiscal year 2025 after which 10 more states will have the opportunity to join the CCBHC Medicaid Demonstration in fiscal year 2026. According to the Congressional Budget Office, the national expansion of the CCBHC Medicaid demonstration is estimated to provide over $8.5 billion in new federal Medicaid support to states over the next decade.

The 10 states announced today join eight states currently participating in the demonstration program (Michigan, Missouri, Kentucky, Nevada, New Jersey, New York, Oklahoma, and Oregon). The new demonstration states will be eligible to receive the enhanced federal Medicaid support for the four-year period beginning in July.

Anne Dwyer is an Associate Research Professor at the Georgetown University McCourt School of Public Policy’s Center for Children and Families.