Maine DHHS Announces Historic Payment Reforms for Behavioral Health

January 11, 2023

The Maine Department of Health and Human Services (DHHS) announced today an unprecedented increase in behavioral health investments to $237 million in federal and state funds to continue MaineCare and related payment improvements as well as make critical investments in the children’s behavioral health system and opioid response.

Effective for January 1, 2023, MaineCare payment rates for a range of behavioral health services that help Maine people access care in their communities will increase by a median of 6.6 to 72.3 percent by service. The new MaineCare reimbursement rates support mental health and substance use disorder services and “targeted case management,” which helps MaineCare members access and coordinate mental health, medical and social services in their communities. The new rates are the result of a series of rate studies conducted by the Department with public input in 2022, as part of MaineCare’s nationally recognized, new rate system reform process. The proposed biennial budget includes $213 million in funds to continue these payment improvements, including related Office of Behavioral Health (OBH) and Office of Child and Family Services (OCFS) state-funded programs as well as $46 million to update behavioral health payments for cost-of-living adjustments and housing costs given higher than expected inflation.

The proposed biennial budget also includes $17 million to address the urgent need to expand the range of services for children’s behavioral health. This would support a new system and staff to connect children with needed services, additional services to meet complex needs, education, and training. This will catalyze progress on Maine’s children’s behavioral health strategy.

The Governor also proposed $7 million to target toward direct response to the opioid crisis. The OBH funding would complement both the MaineCare behavioral health payments as well as the $28 million in opioid litigation settlement funds from Johnson & Johnson and distributors to be allocated by the Recovery Council, Attorney General, and municipalities this year.

Reforming Rates for Mental Health and Substance Use Disorder Services: Effective January 1, 2023, MaineCare payment rates have been updated for over 115 discrete services in five areas of policy:

  • Section 13: Targeted Case Management: 6.6% median increase
  • Section 17: Community Support Services: 59.2% median increase
  • Section 28: Rehabilitative and Community Support Services for Children with Cognitive Impairments and Functional Limitations: 72.3% median increase
  • Section 65: Behavioral Health Services: 22.0% median increase
  • Section 92: Behavioral Health Home Services: 43.0% median increase.1

Many services have gone years without a substantial rate update. Some services relied on "legacy rates," or rates with unknown origin, that had been updated only sporadically over time. Inflation and wage increases also factor into these higher payment rates.

MaineCare’s rate reform system, created in partnership with the Legislature and stakeholders (PL21, Ch. 639 (PDF)), provides a transparent and timely system for reviewing and updating MaineCare’s rates on a regular basis. Under Maine law, rate updates must be data-driven, occur at regular intervals, and include multiple avenues for provider and stakeholder feedback. The rates announced today were among the first services to go through this new formal process that was recently highlighted by the National Association of Medicaid Directors through a 2022 Spotlight Award. DHHS has prioritized behavioral health system rate reform to advance both its ongoing work toward ending the 30-year old consent decree for adult mental health and filling urgent gaps in the children’s behavioral health system.

The Department is additionally suspending rate decreases recommended through the rate determination process for behavioral health services in these sections of policy until at least March 31, 2025, related to a provision of the American Rescue Plan designed to enhance, expand, or strengthen home- and community-based services, including behavioral health services.

In addition to the January 1, 2023 rate updates, MaineCare is also transitioning Assertive Community Treatment (ACT) for adults and Home and Community Treatment (HCT) Services to alternative payment models. ACT is an evidence-based multidisciplinary team approach with assertive outreach in the community that improves outcomes for adults with serious mental illness. HCT is an in-home clinical service that offers strategies to help the child/youth and family manage mental health symptoms to improve functioning at home, in school, and in the community. This shift provides increased administrative and billing flexibility to providers so they can better meet the needs of individuals, while simultaneously promoting accountability for quality of care by tying a portion of payments to performance starting later in 2023.

Similar services provided to uninsured Maine residents funded by OBH and OCFS will also increase if the proposed budget is enacted, with the total biennial budget investment equal to $166 million.

In the 2023 state fiscal year (FY), the new rate increases will be funded by a down payment in the FY 2022 supplemental budget (PL 2022 c.635) and the Medicaid Stabilization Fund. The biennial budget also includes $46 million to adjust existing rates for higher-than-expected inflation.

“These historic improvements in Maine’s payments for behavioral health will expand capacity and help Maine residents be healthy and resilient,” said Sarah Squirrell, who was recently named permanent Director of OBH, which oversees the delivery of mental health and substance use disorder services for Maine people. “They are needed at a time when providers continue to struggle with pandemic-related inflation and workforce challenges and will speed recovery and strengthen our behavioral health system for the long run.”

Improving the Children’s Behavioral Health System: The Department has also proposed initiatives to meet the behavioral health needs of children and their families with an investment of $17 million targeted towards initiatives that will improve the accessibility, availability, quality, and consistency of children’s behavioral health services. These initiatives were heavily informed by the extensive stakeholder engagement that the Office of Child and Family Services has engaged in with youth, parents, and providers over the last few years as well as advocates and the Department of Justice, allowing OCFS to develop initiatives specifically targeted to the current and evolving needs of Maine’s children and their families as the Department continues to rebuild the children’s behavioral health system of care.  

These initiatives are detailed in OCFS’ Children’s Behavioral Health Annual Report (PDF) which was published today. They include a continuation of the emphasis on evidence-based tools and treatment, ensuring that the services available for children are based in research that supports their effectiveness and that providers have the training to deliver these services to fidelity. OCFS is continuing to build on the stakeholder engagement that has occurred over the last few years by expanding opportunities to partner with providers to ensure that the rates and service structure for children’s services support safe and consistent treatment delivery. Throughout this work, OCFS will continue to partner with MaineCare on rates and service models, including on improvements to the children’s crisis system, implementing a wholistic approach to ensure continuity of care for children’s behavioral health services, and expanding the spectrum of services available to meet the specific needs of Maine’s children and families.  

“The investments proposed in the Governor’s budget will continue and build upon work initiated with federal grant and relief dollars,” said OCFS Director Todd Landry. “The convergence of several years of strong stakeholder engagement and pandemic-related funding has given OCFS the opportunity to thoughtfully design initiatives to maximize improvements to the children’s behavioral health system. The pandemic and economic factors have had an undeniable impact on children, families, and providers, and we are uniquely positioned to be able to tailor our initiatives to rebuild the children’s behavioral health system in a dynamic way that meets both long-standing and new and evolving needs of Maine’s children and families.” 

Supporting Direct Response to Opioid Crisis: OBH directly funds services for uninsured Maine residents and those not supported by federal grant programs or Medicaid. The proposed budget would target $7 million towards continued strengthening and expansion of critical substance use services and supports in light of the ongoing high rate of drug overdose deaths in Maine. These funds will support three critical areas of Maine’s Opioid Response: overdose prevention, recovery support, and substance use treatment. Funding will expand distribution of the opioid reversal agent naloxone to further advance t its availability statewide. Saturating communities with naloxone is one of the most effective public health interventions to prevent overdose deaths. Funding will further enhance overdose prevention efforts through the OPTIONS Program and will strengthen the continued development of recovery supports and programs across the state including Recovery Coaches, Recovery Centers, and Recovery Residences. In addition, funding will support expanding capacity of substance use residential treatment and Medically Supervised Withdrawal (‘Detox’) programs. Funding will also support the Prescription Drug Monitoring Program (PMP), a proactive tool to track controlled prescription drugs dispensed within the state that prescribers, pharmacists, and other health care professionals can use to address misuse, abuse and diversion of prescription drugs.

This complements the significant funding coming to Maine from settlements of lawsuits against drug manufacturers. In 2022, as part of the Johnson & Johnson and distributor’s settlement, Maine received $28 million to be spent by the Recovery Council, Attorney General, counties and municipalities as part of a $130 million, 18-year agreement.

“These investments continue the efforts begun in 2019 to support Mainers struggling with substance use disorders and at risk of an overdose,” said Gordon Smith, Director of Opioid Response. “While the global pandemic and the lethal nature of the drugs being transported into the state have challenged our ability to keep individuals safe, the new funds will allow us to continue the most promising evidence-based practices, including distribution of naloxone and providing behavioral health liaisons to outreach to individuals surviving an overdose.”


Strengthening Maine’s behavioral health system is a priority for Maine DHHS under the Mills Administration. Every budget signed into law by Governor Mills has increased funding for behavioral health and DHHS has worked to bridge gaps in Maine’s behavioral health continuum of services. This investment builds on the FY2022-23 budget’s $230 million for behavioral health to support the workforce, capacity, and resilience of providers as well as sustainable MaineCare rates into the future.

These initiatives would further build on DHHS’ improvements to services for people experiencing crisis that, to date, include:

  • Opening Maine’s first close supervision residential facility in January 2022 to provide an alternative to incarceration and hospitalization for justice involved patients who do not meet the criteria for inpatient psychiatric care;
  • Successfully implementing 988 in July of 2022 improving “front door” access to the statewide Maine Crisis Line and regional mobile crisis and crisis residential services across the state
  • Opening Maine’s first comprehensive Crisis Receiving Center in February 2022 in Portland to providing crisis stabilization services as an alternative to emergency departments or jails for people in need of crisis services; and
  • Expanding crisis support for youth and children statewide, based on the successful pilot of Crisis Aftercare in Aroostook County.

In addition, these investments will further strengthen the continuum of substance use treatment and recovery services and supports implemented to date, including:

  • Provided health insurance coverage through MaineCare expansion to over 100,000 Mainers with over 22,000 individuals receiving treatment for substance use
  • Substantial increases in rates for providers for substance use services with increases implemented in 2020/2021 of 77%;
  • Expansion of treatment for substance use and opioid use disorder with increases in Medication for Opioid Use Disorder (MOUD), and increasing Opioid Treatment Program (OTP) and X-Waivered providers across the state;
  • Expansion of Substance Use Residential Treatment Programs and Medically Supervised Withdrawal (‘Detox’) treatment capacity including two RFA’s issued in 2022 providing up to $5.4M in capital and catalyst funding to support the expansion SUD Residential Treatment beds;
  • Recruitment and training of over 1,000 recovery coaches;
  • Year-over-year growth of Recovery Community Centers and Certified Recovery Residences across the state in addition to over 75% of Certified Recovery Residences supporting residents on medication for substance use disorders;
  • Increased Syringe Service Programs, a well-established, evidence based, harm reduction strategy
  • Establishing the Options Program statewide inclusive of hiring 16 behavioral health liaisons (one in each county) to work alongside local emergency services and law enforcement to provide therapeutic interventions, outreach, referrals and post-overdose follow-up for individuals
  • Development of Maine’s statewide naloxone distribution program through the establishment of Tier 1 and Tier 2 distributors, and increased distribution of Naloxone by over 100% from 2020 to 2022

This progress is part of the long-term, comprehensive plan DHHS has set in motion to strengthen the behavioral health system in Maine. Such efforts are described in:

  • Maine’s Opioid Response Strategic Action Plan (PDF) which established priorities and ensures coordination across State government.
  • Children’s Behavioral Health Services 2021 Annual Report (PDF) which describes reforms including a rate study by the Mills Administration that resulted in the first rate increase in more than 10 years for children’s residential services, rebuilding evidence-based home and community services, including Trauma Focused Cognitive Behavioral Therapy, and adding new providers for adolescent substance use disorder treatment.
  • Maine’s Home- and Community-Based Services Plan (PDF) which includes unprecedented investments in crisis services, the behavioral health workforce, high-fidelity wrap around services designed to keep people out of residential care, and long-term “lifespan waivers” to align services with individuals’ own preferences and needs. It also specifically includes funds to address needs of individuals with intellectual disability who have challenging behaviors, which are currently being assessed by the New Hampshire’s University Center for Excellence in Developmental Disabilities.

Maine DHHS is also working on a comprehensive statewide strategic plan to serve Maine people with behavioral health needs across the lifespan as directed by Resolves 2021, ch. 80 (LD 1262).

Recognizing the need to address the workforce challenge exacerbated by the COVID-19 pandemic, Governor Mills also included $20 million in the Maine Jobs and Recovery Plan to support health care workforce training. This includes significant investments in the behavioral health workforce.