The H.R.1 Employer Readiness Checklist

The community engagement requirement carries exemptions that map directly onto a behavioral health caseload. Categorically excluded: people participating in a drug addiction or alcohol treatment and rehabilitation program, parents and caretakers of children aged 13 or under or of a disabled individual, people already meeting TANF or SNAP work requirements, pregnant and postpartum individuals, American Indians and Alaska Natives, veterans with a total disability rating, inmates of public institutions, and former foster care youth up to age 26.

Substance use disorder and mental illness work differently, and this is the part most summaries get wrong. They qualify through the medically frail route, which is a two-part test: the state must verify both that the condition exists and that it significantly impairs the person's ability to comply. A diagnosis on its own is not the exemption. CMS points states toward conditions such as schizophrenia, major depressive disorder and panic disorder where they are disabling. Note the carve-out in the other direction: someone in stable recovery, defined as five or more years, is not automatically excluded on that basis.

Separately, states may elect short-term hardship exceptions: for people in a medical institution or receiving intensive outpatient services, for those travelling outside their community for an extended period to treat a serious or complex condition, for residents of areas where unemployment runs at least 50 percent above the national average, and for areas under a declared emergency or disaster. Because these are state elections rather than federal guarantees, they belong in your state grid, not your standard policy.

• Map each exemption category to a field your EHR can already report on, and add the ones it cannot.
• Decide who produces the documentation. For several categories, the proof is a clinical record your organization holds and the client does not.
• Check the SNAP and TANF overlap first. A client already meeting those work requirements is excluded here with no new documentation from you, which makes it the cheapest exemption to establish.
• Confirm whether your state adopted the intensive outpatient hardship exception. If it did, your IOP census is an exemption list.
• Your own clinicians can supply the proof. CMS names physicians, nurse practitioners, physician assistants, psychologists, counselors and therapists, and clinical social workers as acceptable documentation sources, so the letter can come from the person already treating the client.
• States may also establish exemption status from claims and encounter data for the preceding 12 months. That makes clean, timely, correctly coded encounter submission an eligibility issue, not just a billing one.
• Route any SUD data sharing through compliance first. 42 CFR Part 2 still governs these records, and the exemption workflow is exactly where a well-meaning data feed breaks it.
• Write the letter template now, before the first client needs it in a hurry.
• Train intake and front-desk staff to ask the exemption question at first contact, not at renewal.

On noncompliance, the state must send a notice and give the individual 30 calendar days to demonstrate compliance. Thirty days is enough time to fix the problem and short enough to miss entirely.

• Ask your state whether providers can receive notice, or whether the client is the only recipient.
• Add a standing question to every clinical contact in that period: have you received any mail from Medicaid?
• Define an internal escalation path so a flagged client reaches someone who can help within 48 hours.

Beginning with renewals initiated on or after January 1, 2027, states must redetermine eligibility for the Medicaid expansion adult population every six months instead of annually. Your churn rate roughly doubles in frequency of opportunity to lose someone.

• Build a renewal-date field into the client record and run a monthly report of who is due in the next 60 days.
• Batch outreach ahead of each renewal window rather than reacting to terminations.
• Track re-enrollment turnaround as an operational metric with a named target.

Items 5 through 7 describe real labor. Somebody has to do it, and if the role is not named and funded before January it will land on clinicians as unbilled administrative time.

• Name the role, even if it starts as a fraction of an existing position.
• Check whether the cost is allowable under your CCBHC PPS rate, a current grant, or your state's RHTP program.
• Peer support specialists and community health workers are a common fit here, and several states are funding exactly this role through RHTP.

Every pre-licensure clinician on your staff is capped below independent billing. That cap is a revenue constraint you can actually move, unlike most of section 03.

• Count associate-level clinicians by discipline and by exam: ASWB, NCE/NCMHCE, EPPP, MFT, BCBA, addictions.
• Record where each one is: supervision hours complete, exam attempted, exam passed.
• Identify who has been stalled at the exam step for more than six months. That group is your fastest available capacity gain.

If nobody owns the number, the number does not move. Time-to-licensure is the workforce metric that converts most directly into billable hours.

• Baseline the median months from hire to independent licensure for your last two cohorts.
• Set a target, name an owner, and review it on the same cadence as your financials.
• Remove the two most common blockers first: supervision availability and exam preparation.

Continuing education compliance protects both your ability to bill and your standing with accreditors. It is also the first line cut when budgets tighten, which is how a cost saving becomes a citation.

• Confirm you can produce centralized completion records on demand, per clinician, per licensing board.
• Check state-specific mandated topics, which change more often than most compliance calendars assume.
• If records live in individual clinicians' inboxes, that is the gap. Fix it before your next survey.

The predictable sequence: coverage churn squeezes net revenue, finance looks for costs that move quickly, clinical salaries are fixed, and continuing education, exam prep, supervision stipends, and retention benefits get coded as discretionary. They are cut first.

• Bring the pipeline report from item 13 to the budget conversation, not after it.
• Frame the ask in billable capacity and turnover cost, not in training days delivered.
• Then show which parts of it are fundable from something other than the operating budget, which is section 05.

This checklist crosses finance, clinical operations, compliance, HR, and grants. Work that crosses five functions and belongs to none of them does not get done.

• Name a single accountable owner, at director level or above.
• Give them a standing agenda slot, not a task-force charter.

Four dates carry nearly all of the operational weight. They are listed in the summary below. Anything not scheduled against one of them is a preference, not a plan.

• Add each date to the executive calendar with a 90-day pre-brief.
• Attach the owning function to each one.

Boards read the national coverage and want to know what it means here. Give them your numbers rather than the national ones.

• Lead with your expansion-adult share from item 1 and your retroactive exposure from item 4.
• Show the workforce pipeline from item 13 as the mitigation, and the funding map from section 05 as how it gets paid for.
• Be explicit about what remains uncertain, particularly anything that depends on unreleased state guidance.

Guidance is landing continuously across CMS and multiple advocacy organizations. Tracking it yourself is a job. Do not build that job.

• Use the National Council for Mental Wellbeing's free H.R.1 Hub as the standing reference, and check your state Medicaid agency directly for anything state-specific.
• Assign one person to review it monthly and flag changes against this checklist.