Substance Abuse Services

Substance abuse treatment services include participant intake and assessment, outpatient treatment, group and individual counseling and drug testing.

Which HHS programs might be used to provide these services?


Medicaid pays for a broad range of behavioral health services provided by qualified providers to people who are enrolled in Medicaid coverage. Each state must develop a State Medicaid Plan that describes the benefits its program will provide (including what optional services will be covered),  and must have this plan approved by the U.S. Department of Health and Human Services’ (HHS’s) Centers for Medicare and Medicaid Services (CMS).

Federal law and CMS regulations prescribe a core set of benefits that each State must provide. Mandatory benefits include inpatient and outpatient hospital services; nursing facility, rural health clinic, Federally Qualified Health Center (FQHC) services, prenatal and freestanding birth center services; physician, nurse-midwife, and certified pediatric and family nurse practitioner services; home health, family planning, tobacco cessation, laboratory, X-ray services; and early and periodic screening, diagnostic, and treatment (EPSDT) services for children under age 21.

States may decide to cover additional optional services. Optional benefits include clinic services; prescription drugs; rehabilitative services; case management; home and community based services (HCBS) as an alternative to institutionalization; physical, occupational, speech, hearing, and language therapy; diagnostic, screening, and a variety of other services that may be approved by CMS.  States and may limit eligibility for certain additional services to specific groups of people. States may modify their Plan’s coverage of services beyond the federally-mandated core, including changes in provider qualifications, definitions of covered services, target populations, and payment mechanisms for optional benefits.

For both Mandatory and Optional benefits, an individual still must meet “medical necessity” criteria to be eligible for particular covered services. These criteria take into consideration a person’s diagnosis and other factors such as functional impairments.

Who is eligible?

Medicaid is an “entitlement” program, meaning that eligible individuals are entitled to receive covered health, behavioral health, and long-term care services, as defined within the State’s approved Medicaid Plan. The Affordable Care Act expands Medicaid eligibility to persons with incomes under 133% of the Federal Poverty Level (FPL), and allows States to determine eligibility under their Medicaid plans.

How is it financed?

The Medicaid program operates under broad State discretion, and is funded by a combination of State and Federal matching funds.  Each State must develop a State Medicaid Plan that describes the benefits its program will provide.  Many Medicaid benefits, including those most likely to cover behavioral health services delivered in settings such as shelters, drop-in centers, or supportive housing programs, are “optional” benefits, meaning that States can decide if and how to cover these services.  Federal spending on Medicaid is considered a “mandatory” program, meaning that the Federal government matches State spending for all covered services provided to eligible individuals.  This makes Medicaid distinct from other HHS health and supportive services programs, which operate as “discretionary” programs with funding levels that can change from year to year based on actions taken by Congress and the President.

Where do I learn more about the substance abuse services covered under Medicaid?

Where can I find which States have expanded Medicaid?

Substance Abuse Prevention and Treatment Block Grant (SABG)

SAGB is given to States to address their unique behavioral health issues.  There are two main SAMHSA block grants, the Substance Abuse Prevention and Treatment Block Grant (SABG) and the Community Mental Health Services Block Grant (MHBG).  Specifically the Block Grant funds are directed toward four purposes:

  • Fund priority treatment and support services for individuals without insurance or for whom coverage is terminated for short periods of time.
  • Fund those priority treatment and support services not covered by Medicaid, Medicare or private insurance for low income individuals and that demonstrate success in improving outcomes and/or supporting recovery.
  • Fund primary prevention - universal, selective and indicated prevention activities and services for persons not identified as needing treatment.

How is it financed?

States apply for the grant funding through SAMHSA and determine how to spend the funds for prevention, treatment, recovery supports and other services that will supplement services covered by Medicaid, Medicare and private insurance. States fund a network of providers to deliver services, sometimes through a formula funding process.

How does a CoC partner with SABG-funded Agencies?

SABG Grantees

ATR (Access to Recovery)

This SAMHSA program is designed to provide client choice among substance abuse clinical treatment and recovery support service providers, expand access to a comprehensive array of clinical treatment and recovery support options (including faith-based programmatic options), and increase substance abuse treatment capacity, consistent with proven models.  A major goal of the ATR program is to ensure that clients have a genuine, free, and independent choice among a network of eligible providers, using vouchers to access services.  Grantees (State agencies responsible for substance use disorder services or tribal organizations) are encouraged to develop provider networks that offer an array of clinical treatment and recovery support services that can be expected to result in cost-effective, successful outcomes for the largest number of people.

How is it financed?

SAMHSA’s ATR grants provide funding to Single-State Substance Abuse Agencies in the States, territories, and the District of Columbia, tribes and tribal organizations to carry-out voucher programs for substance abuse clinical treatment and recovery support services. ATR grants were offered in 2004, 2007, and 2010.  In the latest round, 30 grants were awarded. The 2010 round is currently in its 4th year of a 4-year grant that ends September 29, 2014.

Where can I find a local ATR provider with which to partner?

ATR Grantees

Health Care for the Homeless Programs and Community Health Centers

Health Care for the Homeless Programs and Community Health Centers deliver primary care and preventive health services as well as oral health services and services to address substance use disorders and mental health.  Some behavioral health services may be delivered directly or through partnerships or referral arrangements with other providers of treatment services. Health Care for the Homeless programs also offer extensive outreach, engagement and case management services, and they often offer transportation and interpretive services, to help people access health care and behavioral health services, as well as assistance with accessing public benefits. Health Care for the Homeless programs are targeted to persons who are homeless and local programs are encouraged to participate in the local CoC planning process.  The first step for any Continuum should be to reach out to any HCH program in its jurisdiction and connect to current services.

How is it financed?

These programs receive grant funding from the Health Resources and Services Administration (HRSA).  In addition, they receive Medicaid reimbursement for some of the services they provide to people who are enrolled in Medicaid.

Where can I find a local HCH provider with which to partner?

Healthcare for the Homeless Grantees

Where can I find a local Community Health Center with which to partner?

Find a Health Center

PATH (Projects for Assistance in Transition from Homelessness)

PATH programs provide services to people who are experiencing mental illness and are experiencing homelessness or risk of homelessness.  PATH eligible services include habilitation and rehabilitation services, case management services, referrals, and housing support services, as well as outreach and a range of other behavioral health services. PATH programs are administered by the State.  State mental health authorities select providers, usually through a competitive process.  PATH providers are encouraged to participate in the local CoC process and all PATH providers are in the process of transitioning data and reporting practices to participate in HMIS

Who is eligible?

Individuals determined to be experiencing serious mental illness or co-occurring serious mental illness and substance abuse disorder; and (2) experiencing homelessness or at imminent risk of homelessness.

How is it financed?

PATH is administered by the Substance Abuse and Mental Health Services Administration (SAMHSA). PATH is a formula grant provided to all 50 States, the District of Columbia, and US territories, and allocated to more than 480 local organizations.

Where can I find a local PATH provider with which to partner?


Cooperative Agreements to Benefit Homeless Individuals (CABHI)

This SAMHSA services program supports infrastructure development at the community and State levels. The major goal of the Cooperative Agreements to Benefit Homeless Individuals program is to ensure that the most vulnerable individuals who are chronically homeless receive access to sustainable permanent housing, treatment, and recovery supports through mainstream funding sources. CABHI funds support three primary types of activities: 1) behavioral health, housing support, and other recovery-oriented services not covered under a State's Medicaid plan; 2) coordination of housing and services for chronically homeless individuals and families at the State and local level which support the implementation and/or enhance the long-term sustainability of integrated community systems that provide permanent housing and supportive services; and 3) efforts to engage and enroll eligible persons who are chronically homeless in Medicaid and other mainstream benefit programs (e.g., SSI/SSDI, TANF, SNAP). 

Who is eligible?

Persons who experience chronic homelessness with substance use disorders or co-occurring substance use and mental disorders.

How is it financed?

The Substance Abuse and Mental Health Services Administration (SAMHSA), the Center for Substance Abuse Treatment (CSAT) and the Center for Mental Health Services (CMHS) provided grant funding to States.

Where can I find CABHI grantees with which to partner?

CABHI Grantees

Which states received CABHI-States funding?

The Substance Abuse and Mental Health Services Administration (SAMHSA), the Center for Substance Abuse Treatment (CSAT), and the Center for Mental Health Services (CMHS) recently modified its Cooperative Agreement to Benefit Homeless Individuals (CABHI), which provided grants directly to entities that provide services, into the ‘CABHI-States’ program focused on building State infrastructure and improving the capacity of State treatment service systems to provide services essential to ending chronic homelessness among people with substance abuse, mental health, and/or co-occurring disorders.

For FY 2013, eligible applicants for CABHI-States are the single State agencies for substance abuse in the District of Columbia (D.C.) and the following States: Arizona, California, Colorado, Florida, Georgia, Hawaii, Illinois, Louisiana, Maryland, Massachusetts, Michigan, Nevada, New York, Oregon, Pennsylvania, Texas, and Washington. Services to be created through CABHI-States should include recovery-oriented services not covered under the State’s Medicaid plan including: treatment services; permanent supportive housing; peer supports; CMHS-funded peer navigator(s); assistance with streamlining application processes for mainstream benefits; and more. 

SAMHSA awarded eleven grants for up to $711,818 per year for up to 3 years.   The States that were funded are: Arizona, Georgia, Hawaii, Washington, Louisiana, Illinois, Pennsylvania, Massachusetts, Michigan, Colorado and Nevada. Each CABHI-State grantee will implement its own approach to issuing funding for services. Organizations seeking funding for services should contact the single State agencies who received an award for more information.