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New Mexico - Residential Care Service — Licensing, Medicaid Enrollment and Startup Requirements

Last reviewed: 2026-09-10

In New Mexico, 24-hour residential services for individuals with intellectual and developmental disabilities are funded primarily through the Developmental Disabilities (DD) Waiver and licensed by the Department of Health (DOH) as Adult Residential Care Facilities (Assisted Living Facilities). The New Mexico Health Care Authority (HCA), Developmental Disabilities Supports Division (DDSD) manages provider enrollment for the DD Waiver.

To become an approved Living Supports provider under the DD Waiver, an agency must first secure an Adult Residential Care Facility license from the DOH Division of Health Improvement, Health Facility Licensing and Certification Bureau. The most significant structural prerequisite is that funding is not guaranteed; providers must be selected by recipients or their guardians from approved service providers as identified in an Individual Service Plan (ISP) and approved by the Medicaid Third Party Assessor.

1. Service Definition and Scope

Under the New Mexico DD Waiver, 24-hour residential services are categorized as Living Supports. These services provide habilitation, supervision, and personal care to individuals with intellectual and developmental disabilities in a licensed residential setting.

Living Supports must be delivered in a home-like environment and comply with the federal HCBS Settings Rule. The service is designed to assist participants in acquiring, retaining, and improving the skills necessary to reside successfully in the community.

2. Regulatory and Oversight Agencies

The New Mexico Health Care Authority (HCA), Developmental Disabilities Supports Division (DDSD) is the primary operating agency for the DD Waiver, managing provider enrollment and service standards. The Department of Health (DOH), Division of Health Improvement (DHI) handles the physical facility licensure.

Medicaid enrollment and billing are managed through the HCA Medical Assistance Division (MAD) and the state's MMIS portal.

3. Gatekeeping Prerequisites: Who Can Even Apply

Before applying to become a DD Waiver Living Supports provider, an agency must understand the structural prerequisites in New Mexico. The state operates an open enrollment process for DD Waiver providers, meaning there is no closed network or RFP procurement required to apply.

However, providers must obtain the appropriate Adult Residential Care Facility license from DOH before they can provide services. Additionally, being an approved provider does not guarantee funding or clients; providers must be selected by waiver participants.

4. Licensure and Certification Requirements

Facilities providing Living Supports must be licensed as Adult Residential Care Facilities (Assisted Living Facilities) under 7.8.2 NMAC. The licensure process involves submitting architectural plans for approval if constructing or remodeling a facility.

The DOH Division of Health Improvement conducts life safety and health surveys to ensure compliance with state regulations before issuing a license.

5. Medicaid Provider Enrollment

After obtaining the necessary DOH license, agencies must apply to DDSD to become an approved DD Waiver provider. This involves submitting the DD Waiver Provider Application, which includes a Provider Information Sheet, Service and County Request Form, and Statement of Assurances.

Once approved by DDSD, the provider must complete the formal Medicaid enrollment process through the HCA Medical Assistance Division to receive a Medicaid Billing Number.

6. Staffing, Training and Background Checks

Living Supports providers must ensure all staff meet the training and qualification requirements outlined in the DD Waiver Service Standards. This includes mandatory training on Abuse, Neglect, and Exploitation (ANE) and incident management.

Agencies must also comply with the New Mexico Nurse Practice Act regarding the delegation of medication administration, including processing orders and maintaining the Medication Administration Record (MAR).

7. Documentation, Policies and Records

The DD Waiver Provider Application requires the submission of comprehensive agency policies and procedures. These documents cannot simply be cut and pasted from the NMAC or DD Waiver Service Standards; they must describe how the business actually operates to assure compliance.

Required documentation includes an Agency Mission Statement, Values, Organizational Chart, and specific policies for Living Supports, such as incident reporting and medication management.

8. Billing, Rates and Claims

Reimbursement for Living Supports under the DD Waiver is based on a Fee-for-Service model. Services must be authorized in the participant's Individual Service Plan (ISP) and approved by the Medicaid Third Party Assessor before billing can occur.

Providers must bill using the appropriate procedure codes and rates established by the HCA. Current billing rates can be found on the HCA website under the Fee for Service section.

9. Approval Sequence and Timeline

The approval process begins with obtaining the Adult Residential Care Facility license from DOH, which involves plan review and life safety surveys. Once licensed, the agency submits the DD Waiver Provider Application to DDSD.

The HCA states that the application process takes approximately 90 days to be completed. Providers must also demonstrate compliance with HCBS settings requirements.

10. Common Denials and Survey Findings

Applications for DD Waiver enrollment may be returned or denied if they do not conform to the required outline, such as failing to include page numbers, using double-sided pages, or submitting policies that are merely copied from the NMAC.

During licensure surveys, common findings often relate to physical site compliance, life safety code violations, and inadequate documentation of staff training or medication administration.

11. Key Contacts and Resources

Providers should utilize the resources provided by the New Mexico Health Care Authority and the Department of Health for the most current regulations, forms, and training materials.

The DDSD website contains links to the DD Waiver Service Standards, billing rates, and the Incident Management System Guide.

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