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

Last reviewed: 2026-08-16

In Montana, Day Habilitation services (often categorized under Day Supports and Activities) provide structured, non-residential daytime programming to individuals with developmental disabilities or severe mental illness. These services are administered by the Department of Public Health and Human Services (DPHHS) through the Behavioral Health and Developmental Disabilities Division (BHDD) and its specific waiver programs.

The single biggest structural barrier to entry in Montana is that the state does not operate an open-door enrollment for Developmental Disabilities Program (DDP) waiver providers. Prospective agencies cannot simply apply for Medicaid enrollment; they must first secure endorsement from a DDP Regional Office, often by responding to a targeted Request for Proposal (RFP) based on regional capacity needs, and pass a rigorous DDP Readiness Review before the state's fiscal agent will even accept their Medicaid application.

1. Service Definition and Scope

Day Habilitation in Montana provides structured, community-based daytime activities designed to help individuals acquire, retain, or improve self-help, socialization, and adaptive skills. Services must be delivered outside the individual's residence and focus on enabling the participant to attain or maintain their maximum functional level.

The service is highly individualized and must directly align with the goals outlined in the participant's Person-Centered Service Plan (PCSP). It is distinct from Supported Employment, as it focuses on general skill-building rather than specific job placement or vocational training.

• Target Population: Individuals enrolled in the 0208 Comprehensive Waiver, 1037 Supports Waiver, or the Severe and Disabling Mental Illness (SDMI) Waiver.
• Service Location: Must be provided in a non-residential, community-based setting that fully complies with the CMS HCBS Settings Final Rule.
• Core Activities: Training in activities of daily living (ADLs), community integration, social communication, and behavioral management.
• Exclusions: Cannot be billed concurrently with Supported Employment, residential habilitation, or state plan personal care services for the same hours.
• Staffing Ratios: Ratios vary based on the individual's assessed Tiered Reimbursement rate, ranging from 1:1 intensive support to small group ratios (e.g., 1:4).

2. Regulatory and Oversight Agencies

Oversight of Day Habilitation services in Montana is bifurcated between program administration and claims processing. The state's health department sets the rules, while a contracted fiscal agent handles the financial and enrollment mechanics.

Providers must maintain compliance with both the programmatic rules of the waiver and the general Medicaid provider requirements enforced by the state's fiscal agent.

• Primary Agency: Montana Department of Public Health and Human Services (DPHHS).
• Operating Division: Behavioral Health and Developmental Disabilities Division (BHDD).
• Program Offices: Developmental Disabilities Program (DDP) and the SDMI Waiver Program.
• Fiscal Agent: Conduent, which operates the Montana Access to Health Web Portal and the state's MMIS.
• Quality Assurance: DPHHS Quality Assurance Division (QAD), which assists with broader facility safety and incident investigations.

3. Gatekeeping Prerequisites: Who Can Even Apply

Montana utilizes strict gatekeeping for HCBS waiver providers to manage network capacity and ensure quality. There is no open enrollment window for new DDP providers to simply submit an application and begin operations.

Before any Medicaid enrollment application is accepted by Conduent, a prospective provider must navigate the BHDD state approval pathway, which requires regional sponsorship and a comprehensive readiness assessment.

• Regional Need Endorsement: Applicants must first contact their local DDP Regional Office (e.g., Billings, Missoula, Great Falls) to confirm a documented regional need for day services.
• RFP/Procurement Access: DPHHS frequently uses targeted Requests for Proposals (RFPs) to expand capacity; standalone applications submitted outside of an RFP or without regional endorsement are typically deferred or rejected.
• DDP Readiness Review: A mandatory pre-enrollment screening by BHDD to verify policies, financial solvency, and HCBS Settings Rule compliance. Approval here is required before Medicaid enrollment.
• NPI Requirement: Applicants must obtain a Type 2 National Provider Identifier (NPI) prior to initiating the state readiness process.
• Business Registration: The entity must be registered and in good standing with the Montana Secretary of State.

4. Licensure and Certification Requirements

Montana does not issue a distinct "Day Habilitation Facility License" through the DPHHS Office of Inspector General (OIG) in the way it licenses residential care or Substance Use Disorder facilities. Instead, Day Habilitation providers are approved via "State Certification" directly through BHDD.

This certification process requires demonstrating strict adherence to the Administrative Rules of Montana (ARM) governing developmental disabilities and passing physical site inspections to ensure community integration.

• Regulatory Authority: Providers must comply with ARM Title 37, Chapter 34 (Developmental Disabilities) or Chapter 90 (SDMI), specifically ARM 37.34.929 for service definitions.
• HCBS Settings Compliance: The physical day program site must pass a DPHHS HCBS site assessment to prove the setting is integrated, non-institutional, and offers community access.
• Fire and Safety: Providers must obtain a local Fire Marshal inspection approval and a Certificate of Occupancy for the physical day program site.
• Insurance Requirements: Proof of commercial general liability and professional liability insurance is mandatory.
• Vehicle Insurance: Commercial auto insurance is required if the provider agency transports individuals to and from community activities.

5. Medicaid Provider Enrollment

Once a provider has successfully passed the DDP Readiness Review and received BHDD state approval, they must enroll as a billing provider through the state's fiscal agent, Conduent.

Enrollment is conducted entirely online via the Montana Access to Health Web Portal. Claims cannot be processed, and services cannot be reimbursed, until this enrollment is fully approved and active.

• Enrollment Portal: Applications must be submitted through the Montana Access to Health Web Portal managed by Conduent.
• Provider Type: Applicants must enroll using HCBS Code 28 (Home and Community Based Services).
• Required Attachment: The BHDD/DDP Program Approval letter or Readiness Review sign-off must be uploaded with the Conduent application.
• EFT Enrollment: A mandatory Electronic Funds Transfer (EFT) authorization form must be completed for claims payment.
• Revalidation: Providers are required to revalidate their Medicaid enrollment every 5 years through the Conduent portal.

6. Staffing, Training and Background Checks

Direct Support Professionals (DSPs) delivering Day Habilitation services must meet strict background and training standards outlined in the DDP Provider Requirements Matrix.

Agencies are responsible for maintaining a complete, audit-ready personnel file for every staff member, proving that all clearances and training were completed prior to the staff member providing unsupervised care.

• Minimum Qualifications: Staff must have a high school diploma or GED and be at least 18 years of age.
• Background Checks: Mandatory Montana Department of Justice (DOJ) Criminal History Record Information (CHRI) check for all direct care staff.
• Registry Checks: Staff must clear the Montana Child and Family Services Division (CFSD) and Adult Protective Services (APS) abuse registries.
• Initial Training: CPR and First Aid certification must be completed prior to delivering any unsupervised care.
• Specialized Training: Staff must complete DDP-required training modules (often administered via the College of Direct Support) within their first 90 days of employment.
• Medication Administration: If assisting with medications during the day program, staff must complete the DPHHS-approved Medication Aide training.

7. Documentation, Policies and Records

Providers must maintain comprehensive policy manuals and individual client records that align with the Person-Centered Service Plan (PCSP) and state administrative rules.

Documentation must clearly justify the time billed and demonstrate how the activities provided during the day program helped the individual progress toward their specific goals.

• Policy Manual: Must include comprehensive policies on client rights, grievance procedures, confidentiality, and incident reporting.
• Person-Centered Plan: All delivered services must strictly follow the individual's DDP-approved Action Plan / PCSP.
• Daily Documentation: Service notes must detail the date, exact start and stop times, specific activities performed, and progress toward PCSP goals.
• Incident Reporting: Providers must use the DPHHS Incident Management system to report critical incidents (e.g., injuries, behavioral crises, elopement) within required timeframes.
• Emergency Preparedness: Agencies must maintain site-specific emergency plans addressing Montana-specific hazards, such as extreme winter weather and wildfires.
• Record Retention: All clinical and billing records must be securely retained for a minimum of 5 years from the date of service.

8. Billing, Rates and Claims

Day Habilitation is billed either in 15-minute increments or on a per diem basis, depending on the specific waiver, the individual's tier, and the prior authorization.

Claims are processed through the Medicaid Management Information System (MMIS) operated by Conduent, and strict adherence to prior authorization limits is required to avoid claim denials.

• Billing System: Claims are submitted electronically via the Montana Access to Health Web Portal.
• Procedure Codes: Typically billed using T2020 (Day Habilitation, per diem) or T2021 (Day Habilitation, 15-minute increments), often with specific modifiers based on the waiver.
• Prior Authorization: 100% of services must be prior-authorized by the DDP Case Manager and entered into the MMIS before billing can occur.
• Rate Structure: Rates are established by DPHHS BHDD and published in the DDP Fee Schedule, often tiered based on client acuity and support needs.
• Timely Filing: Claims must be submitted within 365 days of the date of service to be eligible for reimbursement.

9. Approval Sequence and Timeline

The approval process in Montana is highly sequential. Providers cannot expedite the process by applying to Medicaid first; the DDP regional approval is the critical path.

From initial regional contact to active billing status, prospective providers should expect a multi-month process that relies heavily on state agency review schedules.

• Phase 1: Business formation, NPI acquisition, and initial contact with the local DDP Regional Office (1-4 weeks).
• Phase 2: Submission of the DDP Provider Readiness Review, policy manuals, and program descriptions to BHDD (4-8 weeks).
• Phase 3: Facility site inspection and HCBS Settings Rule validation by state staff (2-4 weeks).
• Phase 4: Submission and processing of the Conduent Medicaid Provider Enrollment application (30-60 days).
• Total Estimated Timeline: 3 to 6 months, depending heavily on regional need, RFP cycles, and inspector availability.

10. Common Denials and Survey Findings

DPHHS Quality Assurance and DDP conduct periodic reviews of approved providers. Failures often stem from documentation gaps, unapproved settings, or staffing compliance issues.

When deficiencies are found, providers may face corrective action plans, suspended referrals, or recoupment of Medicaid funds.

• Settings Rule Violations: Denials or citations for operating in a facility that isolates individuals from the broader community or feels institutional.
• Premature Enrollment: Medicaid applications rejected by Conduent because the provider attempted to enroll before securing the BHDD Readiness Review approval.
• Documentation Gaps: Recoupment of funds due to missing start/stop times or generic service notes that do not tie back to the individual's PCSP.
• Background Check Lapses: Citations for allowing staff to provide direct care before the DOJ CHRI results are fully returned and cleared.
• Lapsed Training: Failure to ensure staff complete the mandatory College of Direct Support modules within the 90-day onboarding window.

11. Key Contacts and Resources

Prospective providers must maintain close contact with state agencies and utilize official portals for the most current manuals, fee schedules, and forms.

Relying on the official DPHHS and Conduent websites ensures compliance with the latest Administrative Rules of Montana and billing guidelines.

• DPHHS BHDD (DDP): Central Office in Helena manages waiver policy, provider readiness, and state certification.
• Conduent Provider Relations: Reached at 800-624-3958, manages the Montana Access to Health Web Portal and MMIS enrollment.
• DPHHS Quality Assurance Division (QAD): Oversees broader facility safety standards and manages the state's incident reporting systems.
• Montana Secretary of State: The portal for business registration, entity formation, and maintaining good standing.
• Montana Department of Justice (DOJ): Processes the required Criminal History Record Information (CHRI) background checks for all staff.

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