Behavioral Health Rate Methodology Modernization - Workgroup Establishment and Study

Cost-based payment planning for behavioral health providers

Beginning July 1, 2026, Maryland establishes a process to base community behavioral health payments on actual care costs. A Maryland Health Care Commission workgroup develops payment methods for certified community behavioral health clinics, outpatient mental health centers, and independent outpatient providers. It uses the required certified-clinic cost study as its baseline and excludes programs founded after 2020 from its samples. Its methods must include resetting certified-clinic rates in demonstration year two and every three years afterward, plus inflation adjustments. Workgroup reports are due June 1 and December 1, 2027. The Department of Health must complete an independent cost study, including rate and impact analyses, by June 30, 2028. State health agencies must use the findings to develop and implement a payment system, consult stakeholders, and adopt rules. Plans must address funding gaps and offer phased rollout options that meet federal Medicaid rules, including the Upper Payment Limit. The law does not guarantee higher rates, provide an appropriation, or directly change household benefits; funding requires later budget or legislative action. Providers must submit needed cost and monitoring data when required by the authorized agencies. An implementation report is due January 1, 2028; annual impact reports are due December 1 starting in 2028. Those reports examine provider finances and worker pay, benefits, job tenure, turnover, and hiring. A parallel temporary outpatient mental health rate-setting framework expires June 30, 2028, unless extended by law.