​​​​​​​CalAIM Behavioral Health Initiative Frequently Asked Questions​

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Below is a list of frequently asked questions have been collected from technical assistance and informational webinars and submissions to the BHCalAIM@dhcs.ca.gov email. DHCS will update this list on a quarterly basis. ​

SMHS Access Criteria​

​​For members who begin specialty mental health services with Z codes (e.g., Z55-Z65), will they eventually require a mental health diagnosis, or can Z or V codes be the only diagnosis that is submitted for reimbursement? Can a Z code be the primary diagnosis?

Reference BHIN 21-073;  BHIN 22-013

As point of clarification, a mental health disorder diagnosis is not required to receive medically necessary SMHS. However, ICD diagnostic codes are required on claims in order for DHCS to receive federal financial participation. Z codes meet the federal requirement for claims and do not indicate a diagnosis of a mental health disorder or a substance use disorder  (see BHIN 22-013).

Z codes can be used during the assessment phase of a member's treatment, including before a mental health disorder diagnosis has been established. Z codes can be used after the assessmen​t phase, including after a mental health disorder has been established. Z codes can also be used after the assessment phase even if a mental health disorder diagnosis has not been established, as a mental health disorder diagnosis is not a prerequisite to receive medically necessary SMHS as set forth in W&I Code section 14184.402(f)(1)(A). This is especially relevant for medically necessary SMHS provided to members under age 21, for whom access criteria to SMHS includes the ability to receive medically necessary SMHS based on high risk for a mental health disorder due to the experience of trauma as specified in BHIN 21-073. All SMHS must be medically necessary. The assessment or other documentation in the medical record should substantiate the use of a Z code. Please refer to the CMS coding guidelines for additional information about Z codes, including when Z codes can be used as a primary diagnosis.

For additi​onal information about the criteria for members to access Specialty Mental Health Services, please refer to BHIN 21-073.

Can SMHS provider submit a claim for a SMHS provided to a memb​er who also has a substance use disorder (SUD) diagnosis?​

Reference  BHIN 21-073

Yes.  As described in the “Co-Occurring Substance Use Disorder" section of BHIN 22-011, SMHS are covered when provided to members who meet SMHS criteria even if they also​​​ have a substance use disorder (SUD) diagnosis.

Please note that substance-related and addictive disorders (e.g., stimulant use disorder) are not “mental health disorders" for the purpose of determining whether a member meets criteria for access to the SMHS delivery system. However, MHPs must cover SMHS for members with a substance use disorder if they also have a mental health condition (or​ suspected mental health condition not yet diagnosed) and meet criteria for access to SMHS as described in BHIN 21-073. The service provided must match the reason for the service encounter using the CMS ICD-10-CM codes.

​If a mental health provider is serving members with a co-occurring substance use disorder, will that impact members getting to the correct level of care for SUD treatment?

Reference BHIN 21-073; BHIN 24-001​​​​​

Mental health providers serving members with a co-occurring substance use disorder (SUD) should provide a referral to the DMC or DMC-ODS county or provider for an initial screening or assessment using the American Society of Addiction Medicine (ASAM) criteria to determine the appropriate level of SUD treatment. For DMC counties, see BHIN 21-071. For DMC-ODS counties, see BHIN BHIN​ 24-001​​​. Members are not obligated to start or enroll in DMC/DMC-ODS services for their SUD condition as a requirement to receive SMHS for their mental health condition.

What is the difference between “medical necessity" and criteria for members to access Specialty Mental Health Services (SMHS)?

BHIN 21-073 separately addresses access criteria and “medical necessity" requirements.  Members must meet specific criteria to access SMHS through the county Mental Health Plan (MHP) delivery syst​em, as identified in Welfare & Institutions Code (WIC) section 14184.402(c)-(d). Services provided to a member through the MHP delivery system must be “medically necessary" or be a “medical necessity," as set forth in WIC section 14059.5(a)-(b)(1).  ​

As context, CalAIM updated the definition of medical necessity for SMHS. Previously, in the former 1915(b) SMHS waiver that was authorized from 2015 through 2021, medical necessity for SMHS was defined in comprehensive detail, predicated on the establishment of specific diagnoses and expected outcomes of proposed interventions. This former 1915(b) waiver defi​​nition of medical necessity corresponded to California Code of Regulations (CCR), Title 9, sections 1830.205 and 1830.210. Prior to CalAIM, members were required to meet these diagnostic criteria, and SMHS services were required to meet the expected outcome criteria, in order for SMHS services to be covered and reimbursable. If, following assessment, these comprehensive medical necessity criteria were not documented as met for each service provided, the county MHPs were at risk of recoupment because the services would be determined to be an overpayment based on the member not meeting medical necessity requirements for SMHS.

To streamline policies and improve access to care, CalAIM supersedes the definition of medical necessity for SMHS at CCR, title 9, sections 1830.205 and 1830.210 and in the former 1915(b) waiver. As a res​​ult of the CalAIM trailer bill AB 133, medical necessity for SMHS services is now defined at W&I Code section 14059.5.

For individuals 21 years of age or older, a service is "medically necessary" or a "medical necessity" when it is reasonable and necessary to protect life, to prevent significant illness or significant disability, or to alleviate severe pain. For members under 21, medical necessity for SMHS services as defined as meeting the standards set forth in Section 1396d(r)(5) of Title 42 of the United States Code, commonly referred to as the EPSDT mandate. As described in BHIN 21-073, “This section requires provision of all Medicaid-coverable services necessary to correct or ameliorate a mental illness or condition discovered by a screening service, whether or not such services are covered under the State Plan. Furthermore, federal guidance from the Centers for Medicare & Medicaid Services makes it clear that mental health services need not be curative or restorative to ameliorate a mental health condition. Services that sustain, support, improve, or make more tolerable a mental health condition are considered to ameliorate the mental health condition are thus medically necessary and covered as EPSDT services." DHCS has consistently included this description of the EPSDT mandate in all pertinent guidance it ha​​s issued under CalAIM with the goal of providing clear, plain-English information about medical necessity for members under 21.​