Chapter 2 focuses on appropriate access to residential behavioral health treatment services for children. Medicaid supports a wide range of behavioral health services for children, including residential treatment programs, which are considered a last resort. States are required to provide treatment for individuals with disabilities, including serious mental illness and serious emotional disturbance, in community-based settings if appropriate. However, for children who need more intense care or pose a safety risk to themselves or their families, it is important that they can access residential treatment when necessary.
The chapter provides an overview of Medicaid coverage for residential treatment services, how children are referred to residential treatment, what is known about the use of residential treatment, the use of out-of-state placement, access considerations related to the continuum of care, and barriers to appropriate residential treatment.
From: June 2025 Report to Congress on Medicaid and CHIP