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

Last reviewed: 2026-09-10

Effective March 1, 2023, the Texas Health and Human Services Commission (HHSC) replaced traditional Day Habilitation in the Home and Community-Based Services (HCS), Texas Home Living (TxHmL), and Deaf-blind with Multiple Disabilities (DBMD) waivers with a new service called Individualized Skills and Socialization (ISS). Providers seeking to offer facility-based daytime programming must secure a Day Activity and Health Services (DAHS) license through the Texas Unified Licensure Information Portal (TULIP) and subsequently obtain a Medicaid waiver contract via the Contract Administration and Management Portal (CAMP).

Applicants cannot receive a waiver contract without first completing Medicaid enrollment through the Texas Medicaid & Healthcare Partnership (TMHP) Provider Enrollment and Management System (PEMS). The state requires the physical building to conform to Life Safety Code and architectural requirements 45 days before an initial DAHS license application is even submitted.

1. Service Definition and Scope

Texas no longer uses the term "Day Habilitation" for its primary waiver programs. The service was transitioned to Individualized Skills and Socialization (ISS) to better align with federal HCBS settings rules.

For providers operating a physical center where these daytime services are delivered, Texas licenses the facility under the Day Activity and Health Services (DAHS) category. This ensures the physical environment meets health and safety standards outside the individual's residence.

2. Regulatory and Oversight Agencies

The Texas Health and Human Services Commission (HHSC) is the primary regulatory body responsible for licensing DAHS facilities and managing waiver contracts. HHSC conducts the life safety inspections and issues the physical facility licenses.

The Texas Medicaid & Healthcare Partnership (TMHP) acts as the state's Medicaid claims administrator and handles all provider enrollment processing.

3. Gatekeeping Prerequisites: Who Can Even Apply

Texas utilizes an open enrollment process for HCS and TxHmL waiver contracts, meaning there is no closed network or RFP procurement required to apply. However, structural prerequisites must be met before a contract application is accepted.

A provider cannot obtain a waiver contract without first securing an active Texas Medicaid enrollment through TMHP. Furthermore, facility-based providers must pass local fire and health inspections before applying for the DAHS license.

4. Licensure and Certification Requirements

Initial DAHS licensure requires submission through the TULIP system. The application demands proof of local compliance, including fire marshal and health authority clearances.

Once the application is accepted and the building meets requirements, the facility is permitted to admit at least one but not more than three individuals to trigger an unannounced state inspection.

5. Medicaid Provider Enrollment

Medicaid enrollment is processed through TMHP's Provider Enrollment and Management System (PEMS). This step must be completed before applying for the specific waiver contract.

After PEMS enrollment, providers submit a provisional contract application through the HHSC CAMP portal using the required checklist forms.

6. Staffing, Training and Background Checks

HHSC verifies provider qualifications prior to service delivery during standard reviews. Facilities must maintain strict safety protocols, including regular emergency drills.

Changes in key personnel, such as the facility director or manager, must be reported to the state promptly to maintain licensure compliance.

7. Documentation, Policies and Records

DAHS facilities must maintain current documentation in the TULIP system. Renewals and changes of ownership have strict statutory timelines that trigger penalties if missed.

Providers must report changes to phone numbers, fax numbers, or ownership interests within 30 days of the change.

8. Billing, Rates and Claims

Claims for waiver services are processed by TMHP. Due to the 2023 service transition, providers must ensure they are billing under the Individualized Skills and Socialization codes rather than legacy Day Habilitation codes.

Participants must meet specific Medicaid eligibility criteria, often requiring SSI eligibility for Regular State Plan Medicaid access.

9. Approval Sequence and Timeline

The approval sequence begins with physical facility preparation and local inspections, followed by the DAHS license application in TULIP.

Once licensed, the provider enrolls in Medicaid via TMHP PEMS, and finally applies for the waiver contract via CAMP.

10. Common Denials and Survey Findings

Applications are frequently delayed or denied due to physical plant issues or missing local clearances. The Life Safety Code survey is a strict barrier for facility-based services.

Existing providers often face penalties for missing the 45-day renewal window or failing to report management changes.

11. Key Contacts and Resources

Providers must utilize the state's official portals for licensing and enrollment. The HHSC Licensing and Credentialing unit handles direct inquiries regarding DAHS applications.

TMHP manages all questions related to PEMS and Medicaid billing.

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