Maryland - Day Habilitation Services — Licensing, Medicaid Enrollment and Startup Requirements

Last reviewed: 2026-08-16

In Maryland, Day Habilitation Services are administered under the state's Medicaid Home and Community-Based Services (HCBS) waivers, primarily the Community Pathways and Community Supports waivers. Overseen by the Developmental Disabilities Administration (DDA), these services provide structured daytime programming outside the participant's residence to build self-help, socialization, adaptive skills, and community integration for adults with developmental disabilities.

The single biggest structural barrier to entry for prospective Day Habilitation providers in Maryland is the DDA's rigorous pre-certification gatekeeping process. Before an agency can apply for a license or enroll in Medicaid, it must submit and pass a comprehensive DDA Provider Application that includes a detailed Business Plan, a Program Service Plan, and a Quality Assurance Plan. Without DDA's explicit programmatic approval of these foundational documents, the application is blocked from proceeding to the Office of Health Care Quality (OHCQ) for licensure or to the state's Medicaid enrollment portal.

1. Service Definition and Scope

Day Habilitation in Maryland is designed to support individuals with developmental disabilities in acquiring, retaining, and improving the self-help, socialization, and adaptive skills necessary to reside successfully in the community. Services are driven by the participant's Person-Centered Plan (PCP) and focus on meaningful community integration.

These services must be provided in non-residential settings, which can include community hubs or facilities owned and operated by the provider agency. The service model emphasizes personal development, pre-vocational activities, and daily living skills.

• Target Population: Adults 18 years of age or older who have a developmental disability and are no longer enrolled in primary or secondary school.
• Service Settings: Non-residential settings separate from the participant's private residence, including community-based locations or provider-operated facilities.
• Covered Activities: Teaching skills for daily living, socialization, personal development, and pre-vocational opportunities.
• Incidental Services: Transportation to, from, and within the program, as well as delegated nursing tasks and personal care assistance based on assessed need, are included in the service.
• Delivery Method: Can be provider-managed or participant-directed, as specified in the waiver application.
• Exclusions: Cannot be billed concurrently with Supported Employment or other residential waiver services during the same hours.

2. Regulatory and Oversight Agencies

The Maryland Department of Health (MDH) is the single state agency responsible for Medicaid. Within MDH, multiple divisions collaborate to oversee the certification, licensure, and enrollment of Day Habilitation providers.

The Developmental Disabilities Administration (DDA) handles programmatic approval and waiver management, while the Office of Health Care Quality (OHCQ) conducts physical site surveys and issues licenses.

• Maryland Department of Health (MDH): The overarching state agency administering the Medicaid program (https://health.maryland.gov).
• Developmental Disabilities Administration (DDA): The MDH division that manages HCBS waivers, reviews provider business plans, and issues initial provider certification (https://health.maryland.gov/dda).
• Office of Health Care Quality (OHCQ): The MDH division responsible for licensing DDA-approved programs and conducting health and safety surveys (https://health.maryland.gov/ohcq).
• Maryland Medicaid Provider Enrollment: The division managing the ePREP (and upcoming MPRIME) portals for final Medicaid billing enrollment (https://health.maryland.gov/mmcp/provider/Pages/enrollment.aspx).

3. Gatekeeping Prerequisites: Who Can Even Apply

Maryland does not require a Certificate of Need (CON) for Day Habilitation services, as CONs in Maryland are reserved for inpatient and residential health facilities. There is also no competitive Request for Proposals (RFP) procurement or closed network for this specific service.

However, the state enforces a strict pre-approval gate. An applicant cannot simply apply for a license or Medicaid number; they must first pass the DDA Provider Application process, which acts as the structural precondition blocking unprepared applicants.

• Certificate of Need (CON): Not required for Day Habilitation in Maryland; CON regulations apply to residential/inpatient behavioral health and medical facilities.
• DDA Pre-Approval Gate: Applicants must submit and receive approval for a comprehensive Business Plan, Program Service Plan, and Quality Assurance Plan directly from the DDA before licensure can begin.
• Corporate Registration: The agency must be registered and in good standing with the Maryland State Department of Assessments and Taxation (SDAT) prior to application.
• Experience Requirement: The DDA application requires a summary of the applicant's demonstrated experience in the field of developmental disabilities; novice applicants without industry experience are routinely blocked.
• NPI Requirement: Applicants must obtain a Type 2 National Provider Identifier (NPI) for the agency before initiating the DDA application.
• Moratoria: There are currently no state-wide moratoria blocking new DDA Day Habilitation providers, unlike certain behavioral health provider types in Maryland.

4. Licensure and Certification Requirements

Once the DDA approves the programmatic and business plans, the provider must obtain licensure through the Office of Health Care Quality (OHCQ). Licensure ensures the physical facility (if applicable) and operational policies meet state safety standards.

The regulatory framework for these services is established under the Code of Maryland Regulations (COMAR), specifically Title 10.

• Regulatory Citation: Providers are governed by COMAR 10.22 (Developmental Disabilities) and COMAR 10.09.26 (Community Based Services).
• Program Service Plan: Must be submitted to DDA detailing the agency's service delivery model and community integration strategies.
• Quality Assurance Plan: A written internal compliance and quality improvement plan that must be explicitly approved by the DDA.
• Prior Licensing Reports: Applicants must submit any licensing reports, including deficiency and compliance records, issued within the previous 10 years from any in-state or out-of-state entity.
• Insurance Requirements: Providers must submit proof of Commercial General Liability Insurance and Workers' Compensation Insurance.
• Facility Compliance: If operating a physical day program site, the facility must pass OHCQ inspection for ADA compliance, fire safety, and appropriate local zoning.

5. Medicaid Provider Enrollment

After obtaining DDA certification and OHCQ licensure, the agency must enroll with Maryland Medicaid to receive a Medicaid Provider Number and bill for services. Federal law requires this enrollment before any claims can be paid.

Maryland is currently transitioning its enrollment portal. The legacy system, ePREP, is being replaced by the Maryland Provider Registry and Information Management Enterprise (MPRIME) in October 2026.

• Enrollment Portal: Applications are submitted through ePREP, which transitions to MPRIME in October 2026 (https://health.maryland.gov/mmcp/provider/Pages/enrollment.aspx).
• Provider Type: Must enroll specifically as a DDA Day Habilitation Service Provider.
• Tax Documentation: Requires a signed W-9 and an IRS 147C letter verifying the agency's Employer Identification Number (EIN).
• SDAT Verification: The legal name and address on the Medicaid application must perfectly match the Maryland SDAT registration and the IRS 147C letter.
• Provider Agreement: The agency's authorized official must sign the Maryland Medical Assistance Provider Agreement during the portal enrollment.
• Billing Restriction: Providers cannot bill Medicaid while the application is pending; there is no retroactive billing for services provided before the official Medicaid effective date.

6. Staffing, Training and Background Checks

Direct Support Professionals (DSPs) and program management staff must meet strict DDA qualifications before providing Day Habilitation services. Maryland places a heavy emphasis on behavioral support training and background clearances.

Agencies must maintain comprehensive personnel files demonstrating that all staff have completed required background checks and DDA-mandated training modules prior to client contact.

• Criminal Background Checks: State and federal criminal history records checks (CJIS) are mandatory for all staff prior to employment.
• Exclusion Screenings: Staff must be screened against the federal Medicaid Exclusion List (LEIE) and clear Maryland Child Protective Services (CPS) background checks.
• Basic Certifications: All direct care staff must hold current CPR and First Aid certifications.
• DDA Core Training: Staff must complete DDA-mandated trainings, which include Person-Centered Thinking, community integration, and approved behavioral support techniques (e.g., Mandt).
• Program Director: The agency must employ a full-time program director with demonstrated experience in developmental disabilities and program management.
• Delegated Nursing: If nursing tasks are required, they must be performed by or delegated under the supervision of a Maryland-licensed Registered Nurse (RN).

7. Documentation, Policies and Records

Maryland DDA and OHCQ require rigorous documentation to prove that Day Habilitation services are delivered exactly as outlined in the participant's Individual Plan (IP).

Providers must maintain auditable programmatic and financial records. Failure to maintain these records can result in licensure revocation or Medicaid clawbacks during state audits.

• Individual Plan (IP): All services must be directly tied to goals and authorizations documented in the participant's DDA-approved IP.
• Service Notes: Daily documentation must include the date, start and end times, specific activities performed, and the participant's progress toward IP goals.
• Incident Reporting: Providers must report critical incidents (e.g., injuries, behavioral crises) through the DDA's incident management system within mandated timeframes.
• Quality Assurance Audits: The agency must implement its DDA-approved Quality Assurance Plan, conducting regular internal audits of service notes and billing records.
• Record Retention: Medicaid regulations require all financial, staffing, and participant records to be retained for a minimum of six years.
• Policy Manual: Must maintain comprehensive policies covering participant rights, grievance procedures, emergency preparedness, and community integration.

8. Billing, Rates and Claims

Day Habilitation services are funded through the Community Pathways and Community Supports waivers. Claims are processed through Maryland's Long Term Services and Supports (LTSSMaryland) system and the Medicaid Management Information System (MMIS).

Rates are standardized and published by the DDA. Providers must ensure that all billed services are prior-authorized in the participant's plan before submission.

• Billing System: Claims are submitted, tracked, and processed via LTSSMaryland and the state MMIS.
• Rate Structure: Rates are established by MDH/DDA and are typically billed in 15-minute increments or as a daily rate, depending on the specific authorization.
• Prior Authorization: Services cannot be billed unless they are prior-authorized in the participant's PCP and loaded into LTSSMaryland.
• Included Costs: Transportation to, from, and within the Day Habilitation program is factored into the service rate and cannot be billed as a separate line item.
• Claim Denials: Claims will automatically deny if the provider's Medicaid enrollment is inactive, if the service date precedes the enrollment effective date, or if units exceed the IP authorization.
• Participant Liability: Providers must accept the Medicaid rate as payment in full and cannot balance-bill participants or their families.

9. Approval Sequence and Timeline

Becoming an approved Day Habilitation provider in Maryland is a sequential process that typically takes 6 to 12 months from initial business registration to final Medicaid enrollment.

Applicants cannot skip steps; DDA approval is required for OHCQ licensure, and both are required before the ePREP/MPRIME Medicaid enrollment application can be submitted.

• Step 1: Register the business with SDAT and obtain an EIN and Type 2 NPI (1-2 weeks).
• Step 2: Submit the DDA Provider Application, including the Business Plan, Program Service Plan, and QA Plan (3-6 months for DDA review and approval).
• Step 3: Undergo OHCQ facility inspection (if applicable) and receive state licensure (1-3 months post-DDA approval).
• Step 4: Submit the Medicaid enrollment application via ePREP or MPRIME (30-90 days for processing).
• Step 5: Receive the Medicaid Provider Number, execute the Provider Agreement, and gain access to LTSSMaryland to begin accepting authorizations.

10. Common Denials and Survey Findings

Applications are frequently delayed or denied at the DDA stage due to poorly constructed business plans that do not align with Maryland's specific rate structures or community integration mandates.

During OHCQ surveys, deficiencies most commonly arise from administrative oversights in human resources and failure to individualize participant documentation.

• Application Denial: Submitting a generic Business Plan that lacks specific financial projections based on current Maryland DDA reimbursement rates.
• Application Denial: Failing to provide a sufficient summary of the applicant's demonstrated experience in the developmental disabilities field.
• Survey Deficiency: Missing or expired background checks, CPS clearances, or CPR/First Aid certifications in DSP personnel files.
• Survey Deficiency: Service notes that are identical day-to-day (cloned notes) or fail to reference the specific goals outlined in the participant's IP.
• Enrollment Rejection: Name or address mismatches between the SDAT registration, the IRS 147C letter, and the ePREP/MPRIME application.
• Survey Deficiency: Operating a facility that fails to meet ADA accessibility standards or local fire marshal codes.

11. Key Contacts and Resources

Prospective providers must rely on official Maryland Department of Health portals and resources to navigate the certification and enrollment process.

Because systems like ePREP are transitioning to MPRIME, providers should frequently check MDH transmittals for the most current portal links and application forms.

• DDA Provider Application Info: Official guidance and forms for DDA certification (https://health.maryland.gov/dda/Pages/providers.aspx).
• Maryland Medicaid Provider Enrollment: Portal access for ePREP and MPRIME transition updates (https://health.maryland.gov/mmcp/provider/Pages/enrollment.aspx).
• Office of Health Care Quality (OHCQ): Information on facility licensure and survey regulations (https://health.maryland.gov/ohcq).
• Maryland State Department of Assessments and Taxation (SDAT): For corporate registration and good standing certificates (https://dat.maryland.gov).
• ePREP/MPRIME Hotline: 1-844-463-7768 (for checking Medicaid enrollment application status).

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