The Michigan Department of Health and Human Services (MDHHS) recently finalized Medicaid Policy Bulletin MMP 26-17, effective July 1, 2026, which clarifies reimbursement requirements for specialty behavioral health services provided through Prepaid Inpatient Health Plans in home, community and residential settings. The policy applies to Medicaid and the Healthy Michigan Plan.
The final policy encourages mental health and intellectual and developmental disability services to be provided in integrated community settings, including an individual’s home, when appropriate. The bulletin also clarifies coverage requirements for substance use disorder residential treatment services, nursing facilities, child-caring institutions and children’s therapeutic group homes. For children and youth, services should be provided in the least restrictive setting appropriate to their needs.
The final policy includes several changes from the proposed policy, including:
New requirements related to the coordination of Early and Periodic Screening, Diagnostic and Treatment services for children residing in child-caring institutions
Additional clarification regarding services available to children with intellectual and developmental disabilities
Removal of a proposed section addressing Medicaid coverage in Institutions for Mental Diseases (IMDs)
The MHA submitted comments requesting clarification regarding covered services in nursing facilities, IMD coverage policies and reimbursement for services provided to children in child-caring institutions. While the final bulletin provides additional clarification, it does not address all the questions raised by the MHA.
Members impacted by specialty behavioral health service delivery and reimbursement requirements are encouraged to review the bulletin.
Members with questions may contact Lenise Freeman at the MHA.