Texas Medicaid billing is the process of submitting claims, managing prior authorizations, handling denials, and collecting reimbursement for services provided to Medicaid beneficiaries in Texas. The system operates through two channels: fee-for-service claims processed by the Texas Medicaid & Healthcare Partnership (TMHP), and managed care claims processed by Medicaid managed care organizations (MCOs) contracted with the Texas Health and Human Services Commission (HHSC).
About 4 million Texans are enrolled in Medicaid and CHIP (KFF, March 2026), most of them through STAR managed care. Billing Texas Medicaid is not a single process — it is a network of distinct programs, payers, and requirements that vary by patient enrollment, service type, and geographic location. This guide covers every operational requirement Texas providers need to maintain compliant billing and maximize reimbursement.
What Are the Texas Medicaid Programs?
Texas Medicaid operates through several distinct programs, each with its own eligibility criteria, covered services, and billing workflows. Identifying which program applies to a patient is the first step in submitting a clean claim.
Traditional Fee-for-Service Medicaid
Fee-for-service (FFS) claims are submitted directly to TMHP. This pathway applies to services not covered by MCOs, out-of-network providers, certain behavioral health services, and patients not enrolled in a managed care plan. FFS claims follow TMHP's fee schedule, filing rules, and prior authorization requirements.
STAR Managed Care
STAR is Texas's largest Medicaid managed care program, covering children, pregnant women, and families. Services are billed to the patient's assigned MCO — not to TMHP. Each MCO has its own fee schedule, claim edit rules, prior authorization requirements, and timely filing windows. MCOs operating in Texas include Superior HealthPlan (Centene), UnitedHealthcare Community Plan, Molina Healthcare, Cook Children's Health Plan, Wellpoint (formerly Amerigroup), Community First Health Plans, El Paso Health, Community Health Choice, and Baylor Scott & White Health Plan.
STAR Kids
STAR Kids covers children with disabilities and those receiving SSI-related benefits. The program is administered through MCOs with specialized pediatric networks and additional behavioral health and long-term services. Billing requirements mirror STAR but include pediatric-specific codes and authorization workflows.
STAR+PLUS
STAR+PLUS is Texas's Medicaid Managed Long-Term Services and Supports (MLTSS) program, covering adults 21 and older with physical disabilities, chronic conditions, or dual Medicare-Medicaid eligibility. The program requires Electronic Visit Verification (EVV) for home and community-based services, Individual Service Plans (ISPs) for authorization, and HCPCS codes per the HHSC LTSS billing matrix.
2026 Regulatory Change: The federal MMP Dual Demonstration ended December 31, 2025. In Bexar, Dallas, El Paso, Harris and Hidalgo counties, it was replaced by Integrated Dual Eligible Special Needs Plans (D-SNPs) that are aligned with the same company's STAR+PLUS MCO; members can also choose another Medicare plan with separate STAR+PLUS enrollment. (TMHP) Providers serving these members must verify new plan codes and obtain fresh authorizations under the new MCO before billing.
CHIP (Children's Health Insurance Program)
CHIP covers children in families with incomes too high for Medicaid but too low for private insurance. CHIP claims are billed through MCOs with specific CHIP benefit packages. CHIP has separate income eligibility limits and may require cost-sharing that does not apply to Medicaid claims.
Decision Guide: Which Program Applies to Your Patient?
Before submitting any claim, verify the patient's current enrollment status through the TMHP eligibility verification portal or the MCO's provider portal. Key questions to answer:
- Is the patient enrolled in fee-for-service or managed care?
- If managed care, which MCO and plan (STAR, STAR Kids, STAR+PLUS, CHIP)?
- Is the patient dual-eligible (Medicare and Medicaid)?
- Is the enrollment active on the date of service?
- Has the patient changed MCOs recently (especially post-Dual Demo transition)?
Operational rule: Always verify eligibility on the day of service. Texas Medicaid eligibility changes monthly. A patient who was enrolled last month may have lost coverage, switched MCOs, or transitioned between programs. Billing without current verification is the leading cause of preventable denials.
TMHP Provider Enrollment Requirements for 2026
Every provider billing Texas Medicaid — whether fee-for-service or through an MCO — must enroll with TMHP through the Provider Enrollment and Management System (PEMS). Federal law under the 21st Century Cures Act requires all ordering, referring, and prescribing providers to enroll directly with HHSC through TMHP, even if they do not bill directly.
Step-by-Step PEMS Enrollment Process
- Create a TMHP PEMS account. Access the PEMS portal at tmhp.com. Establish administrative access for the provider or group. Each provider needs an individual PEMS login.
- Complete the Provider Enrollment Assistant Tool (PEAT). The PEAT pre-application walks you through enrollment type selection: Type 2 NPI for group practices, Type 1 NPI for individual practitioners, or facility/agency types for institutional providers.
- Submit enrollment application with required documentation. Upload licensure, DEA registration, liability insurance, ownership disclosure, and the $750 application fee (increased from $730 in 2025). Applications with incomplete documentation are returned to provider (RTP) status.
- Respond to deficiency requests promptly. OIG screening may request additional documentation, and an application is denied if the requested information isn't provided by TMHP's deadline.
- Obtain Closed-Enrolled status. Revalidation and enrollment are not complete until the record reaches Closed-Enrolled status in PEMS. In-flight applications must be submitted (not in Draft status) to qualify for revalidation extensions.
- Credential with each MCO. MCO credentialing is a separate process from TMHP enrollment. Each MCO requires its own application, and credentialing timelines vary by plan. Being enrolled with one MCO does not transfer to others.
Enrollment Timelines and the $750 Application Fee
TMHP's provider manual lists a 60-day baseline for enrollment processing. In practice, OIG screening often makes it take longer, so plan for several months. Plan accordingly — a new practice should begin enrollment 4–5 months before the intended billing start date.
| Provider Type | Typical State Enrollment | MCO Credentialing Add-On | Total Timeline |
|---|---|---|---|
| Solo provider | 30–45 days | 30–60 days | 60–105 days |
| Group practice (Type 2) | 60–90 days | 30–60 days per MCO | 90–150 days |
| Facility / agency | 90–150+ days | 60–90 days | 150–240 days |
| Hospice (automatic HIGH risk) | 90–150+ days + fingerprint | 60–90 days | 150–240+ days |
IAMOnline and Multi-Factor Authentication
TMHP is transitioning all provider access to the new IAMOnline authentication system with mandatory multi-factor authentication (MFA). Users who haven't completed MFA registration can't sign in to PEMS, so set it up for every user on your account.
Revalidation Deadlines and the 4-Tier Extension Framework
Texas operates a 4-tier revalidation extension system for providers with revalidation due dates on or before May 31, 2026:
| Extension Tier | Duration | Requirement |
|---|---|---|
| First Extension | 180 days | Revalidation due date on/before May 31, 2026; no prior extension required |
| Second Extension | 180 days | In-flight revalidation application in PEMS (not Draft status) |
| Third Extension | 60 days | In-flight application + due date on/before May 31, 2026 |
| Fourth Extension | 60 days | Eligible providers receive automatically when criteria are met (effective April 9, 2026) |
PEMS checks daily and automatically applies extensions when criteria are met. Revalidation reminders now arrive at 180, 120, 90, and 45 days before the due date. Keep your PEMS email address current to receive these notices.
Texas Medicaid Fee Schedule and Reimbursement
Effective January 1, 2026, TMHP uses a state-specific RVU conversion formula to calculate Medicaid reimbursement. The 2026 conversion rates are:
Rates are uniform across all Texas counties. MCO fee schedules may differ from TMHP FFS rates — each MCO negotiates its own reimbursement structure within the state's upper payment limits.
How to Look Up Reimbursement Rates
TMHP recommends the Online Fee Lookup (OFL) for real-time rate verification. Static fee schedules are snapshots that may be outdated. Access the OFL through the TMHP portal and search by CPT/HCPCS code, place of service, and provider type. For MCO rates, contact each MCO's provider relations department or check the MCO's provider portal — rates are not published in a single centralized location.
Claim Submission Requirements
Coding Requirements (CPT, HCPCS, ICD-10)
Texas Medicaid claims require accurate CPT/HCPCS procedure codes and ICD-10-CM diagnosis codes that support medical necessity. Key coding considerations:
- Diagnosis specificity matters. I25.10 (atherosclerotic heart disease) is different from I25.11 (with angina). The specific code determines whether the procedure meets medical necessity criteria.
- Modifier accuracy is critical. Use -26 for professional components, -TC for technical components, -59 for distinct procedural services, and -25 for separately identifiable E/M services. Incorrect modifiers are the leading cause of coding-related denials.
- Use the HCPCS code in effect on the date of service. Codes are updated quarterly. Billing with outdated codes triggers automatic denials.
NCCI Bundling Edits and the Q1 2026 Updates
The National Correct Coding Initiative (NCCI) edits define which procedure codes cannot be billed together. NCCI edits are updated every quarter, changing bundling and mutually exclusive code pairs. Claims that break a current edit are denied. Review the updated NCCI edits on the TMHP website before billing any code pair you have not previously submitted.
Timely Filing Limits: 95-Day Rule and MCO Variations
TMHP fee-for-service claims must be submitted within 95 days from the date of service. That is one of the shorter Medicaid filing windows. The 95-day clock does not pause for clearinghouse rejections. A claim rejected on day 80 must be corrected and resubmitted before day 95.
| Payer | Timely Filing Limit | Notes |
|---|---|---|
| TMHP (Fee-for-Service) | 95 days from DOS | No appeal after deadline — revenue forfeited permanently |
| Most STAR MCOs | 90 days from DOS | Some MCOs enforce shorter internal windows |
| STAR+PLUS MCOs | 90–180 days (varies by MCO and claim type) | Verify per-MCO deadlines |
| CHIP MCOs | 90 days from DOS | Check individual MCO contract |
Critical rule: Texas Medicaid retrospective billing allows claims up to 95 days prior to the date of submission, provided the provider met all licensure and enrollment requirements on those service dates. However, the 365-day filing deadline from date of service or discharge is absolute — failure to submit clean claims within this window results in permanent revenue forfeiture.
Crossover Claims for Dual-Eligible Patients
For patients eligible for both Medicare and Medicaid, claims must first be submitted to Medicare. The remaining balance automatically crosses over to Texas Medicaid through the Coordination of Benefits (COB) process. Providers do not need to submit a separate Medicaid claim for crossover amounts, but they must ensure the Medicare claim was submitted correctly and on time.
Prior Authorization in Texas Medicaid
The New 7-Day Decision Rule (CMS 0057-F)
Effective January 1, 2026, all Texas Medicaid managed care organizations must comply with the CMS Interoperability and Prior Authorization Final Rule (CMS 0057-F). The key changes:
- Standard (non-urgent) requests: Decision within 7 calendar days of receiving all necessary documentation (reduced from 14 days).
- Expedited (urgent) requests: Decision within 72 hours.
- Transparent denial reasons: MCOs must provide written denial reasons for every denied request.
- Annual transparency reports: MCOs must publish approval, denial, and turnaround data by March 31 each year.
Services Requiring Prior Authorization
Prior authorization requirements vary by MCO and change quarterly. Common service categories requiring PA across most Texas Medicaid MCOs include:
- Inpatient admissions and observation stays
- Advanced imaging (MRI, CT, PET)
- Specialty medications and infusion therapy
- Surgical procedures (varies by CPT code and MCO)
- Durable medical equipment exceeding certain thresholds
- Behavioral health services beyond initial evaluation (IOP, PHP, residential)
- Home health services and personal care under STAR+PLUS
- Genetic testing
How to Appeal a Prior Authorization Denial
If a prior authorization request is denied, providers have the right to appeal. The process varies by MCO but generally follows this sequence:
- Review the denial reason. Under CMS 0057-F, the MCO must provide a specific written reason. Identify whether the denial was for missing documentation, medical necessity criteria not met, or a coding issue.
- Fix and resubmit. If the denial was due to incomplete documentation, gather the required records and resubmit within the MCO's appeal window (typically 90–120 days from denial date).
- Request an internal appeal. File a formal appeal through the MCO's appeals process. Include a cover letter, the original PA request, the denial letter, and additional supporting documentation.
- Escalate to the Independent Review Organization (IRO). If the internal appeal is denied, request an external IRO review. Texas HHSC oversees the external review process.
- File a complaint with HHSC. If the MCO systematically violates authorization requirements, file a grievance with Texas HHSC's Managed Care Helpline at 1-866-566-8989.
Managed Care Organization (MCO) Billing
How MCO Billing Differs from Fee-for-Service
The fundamental difference: FFS claims go to TMHP; MCO claims go to the patient's specific MCO. But the operational differences extend far beyond the submission endpoint.
| Element | TMHP Fee-for-Service | MCO Managed Care |
|---|---|---|
| Claims submitted to | TMHP | Patient's assigned MCO |
| Fee schedule | State-mandated RVU rates | MCO-negotiated rates (may differ) |
| Prior authorization | TMHP PA portal | Each MCO's own PA portal |
| Timely filing | 95 days | 90 days (varies by MCO) |
| Claim edits | TMHP edits + NCCI | MCO-specific edit packages + NCCI |
| Credentialing | TMHP PEMS enrollment | Separate credentialing per MCO |
| Denial appeals | TMHP appeal process | MCO-specific appeal + IRO escalation |
MCO Credentialing Requirements
Each MCO requires separate credentialing. Being credentialed with one MCO does not transfer to others. Contact each MCO operating in your service delivery area simultaneously to minimize the time before you can bill. The HHSC Enrollment Broker (1-800-964-2777) can identify which MCOs serve your specific county.
Coordination of Benefits for Dual-Eligible Patients
Dual-eligible patients — those enrolled in both Medicare and Medicaid — require careful coordination to avoid denials and ensure proper payment sequencing.
2025–2026 COB Documentation Requirements
Beginning January 1, 2025, providers must submit proof with secondary Medicaid claims showing the primary claim was originally filed within the required Medicaid timely filing period. Secondary Medicaid claims without this documentation may be denied even if the secondary claim itself is filed on time.
For every COB claim, maintain:
- Primary payer EOB or ERA
- Clearinghouse submission confirmation for the primary claim
- Portal submission screenshot with timestamp
- Payer correspondence related to the primary adjudication
Common Texas Medicaid Denial Reasons and Prevention
Top Denial Categories
| Denial Category | Typical % | Root Cause | Prevention Method |
|---|---|---|---|
| Missing or invalid prior authorization | 25–35% | PA not obtained or expired | Track PA expiration dates; verify before each service |
| Coordination of benefits errors | 15–20% | Primary insurance not identified | Verify all coverage at check-in |
| Diagnosis code mismatches | 15–20% | ICD-10 does not support procedure | Use diagnosis-specific coding guides |
| Timely filing exceedances | 10–15% | Claims submitted after deadline | Submit within 45 days; track deadlines by MCO |
| Provider not enrolled/in-network | 5–10% | Rendering provider not credentialed | Verify enrollment before billing |
| Medically unlikely edits | 5–8% | Excessive units billed | Review MUE limits before submission |
| Eligibility issues | 5–10% | Patient not eligible on DOS | Verify eligibility day-of-service |
Denial Appeal Process
For TMHP FFS denials, file appeals through the TMHP portal within the specified timeframe. For MCO denials, follow each MCO's appeals process. Common appeal deadlines: 90 days from denial date for most MCOs. Always include the specific denial reason code (CARC) and remark code (RARC) in your appeal correspondence.
Electronic Visit Verification (EVV) Requirements
EVV is mandatory for personal care and home health services under Texas Medicaid. The HHAeXchange system serves as the state's EVV aggregator. Providers must:
- Submit the HHAeXchange Provider Onboarding Form through TMHP's website
- Complete annual EVV training through the TMHP Learning Management System
- Ensure all caregivers delivering Medicaid services are trained on the HHAeXchange mobile app clock-in process
- Maintain an alternative device usage rate below 5% (reviewable in the EVV Portal)
Non-compliance with EVV requirements can result in payment holds and post-payment audits. The Texas HHSC-OIG has identified EVV failures and documentation gaps as top audit triggers for home health and hospice providers in 2026.
Specialty-Specific Billing Considerations
Home Health and Hospice
Texas home health agencies operating under STAR+PLUS must navigate MCO-specific authorization limits, visit type restrictions, and documentation standards. Each STAR+PLUS MCO has its own requirements for initial certification, recertification, and additional visits. EVV is non-negotiable — every visit must be verified through HHAeXchange.
Behavioral Health
Behavioral health services under Texas Medicaid face high prior authorization requirements. The new 7-day PA rule under CMS 0057-F benefits behavioral health providers by reducing turnaround times. Common PA-required services include intensive outpatient (IOP) and partial hospitalization (PHP) programs, residential treatment, ABA therapy (CPT 97151–97158) and TMS (CPT 90867–90869). Check each MCO's code list, because IOP, PHP and residential services are billed with payer-specific HCPCS and revenue codes. The Mental Health Parity and Addiction Equity Act (MHPAEA) requires that PA requirements for behavioral health benefits be no more restrictive than comparable medical/surgical benefits.
Pediatric and CHIP Billing
Pediatric billing under STAR and STAR Kids requires age-specific well-visit codes (99381–99395) and adherence to the Bright Futures preventive schedule. CHIP claims follow separate benefit packages and may require cost-sharing collection that does not apply to Medicaid claims. Verify the patient's specific plan (Medicaid vs. CHIP) before selecting codes.
Measuring Medicaid Billing Performance
Key Performance Indicators
Track these metrics weekly. A first-pass acceptance rate below 90% indicates systemic coding or submission errors. A denial rate above 8% indicates a prior authorization or eligibility verification failure. Days in A/R exceeding 40 days for Medicaid claims signals a timely filing risk.
When to Consider Professional Billing Support
Texas Medicaid billing complexity — multiple MCOs, quarterly code updates, EVV requirements, the 95-day filing limit, and the Dual Demo transition — creates operational burden that exceeds most in-house billing teams' capacity. Practices that benefit from professional billing support typically exhibit:
- Denial rates above 8%
- Net collection rates below 94%
- Days in A/R exceeding 40 days
- Staff turnover in billing positions
- Multiple MCO contracts with varying requirements
- Recent growth in patient volume or provider count
A qualified Texas Medicaid billing partner should demonstrate: current TMHP PEMS enrollment expertise, active credentialing relationships with all major Texas MCOs, familiarity with the 2026 regulatory changes (IAMOnline MFA, Dual Demo transition, 7-day PA rule), and measurable results including denial rate reduction and A/R improvement.
Frequently Asked Questions
What is the timely filing limit for Texas Medicaid?
TMHP fee-for-service claims require submission within 95 days from the date of service. Most MCOs require claims within 90 days, though some enforce shorter windows. Missing the deadline results in permanent revenue forfeiture — there is no appeal for untimely claims.
How long does Texas Medicaid provider enrollment take in 2026?
Plan for several months. The TMHP manual lists 60 days as a baseline, but OIG screening often extends processing, and high-risk provider types such as hospice and home health can take longer. Begin enrollment 4–5 months before your intended billing start date.
What changed with STAR+PLUS billing in 2026?
The federal MMP Dual Demonstration ended December 31, 2025. In Bexar, Dallas, El Paso, Harris and Hidalgo counties, it was replaced by Integrated Dual Eligible Special Needs Plans (D-SNPs) that are aligned with the same company's STAR+PLUS MCO; members can also choose another Medicare plan with separate STAR+PLUS enrollment. Providers must verify new plan codes, obtain fresh ISP authorizations under the new MCO, and update HHAeXchange authorization records before billing affected members.
How does the new 7-day prior authorization rule affect Texas providers?
Under CMS 0057-F, MCOs must decide on standard prior authorization requests within 7 calendar days (down from 14) and urgent requests within 72 hours. MCOs must also provide written denial reasons and publish annual transparency reports. This rule applies to all Texas Medicaid managed care programs including STAR, STAR Kids, and STAR+PLUS.
What is the TMHP fee schedule conversion rate for 2026?
The 2026 conversion rate is $28.0672 per RVU for patients under 21 and $26.7305 per RVU for adults 21 and older. Rates are uniform across all Texas counties. Use the TMHP Online Fee Lookup (OFL) for current rate verification.
Do I need to enroll with TMHP if I only bill through MCOs?
Yes. Federal law under the 21st Century Cures Act requires all providers who serve Texas Medicaid members — whether through MCO networks or fee-for-service — to enroll directly with HHSC through TMHP PEMS. MCO credentialing is a separate process that occurs after TMHP enrollment.
How do I verify a patient's Texas Medicaid eligibility?
Use the TMHP eligibility verification portal or the TexMedConnect system. Verify eligibility on the day of service — Texas Medicaid enrollment changes monthly. For MCO patients, also verify the specific MCO and plan assignment, as patients may switch MCOs during open enrollment periods.
What happens if I bill the wrong MCO?
The claim will be denied as "provider not in network" or "member not enrolled with this plan." Verify the patient's current MCO assignment before every encounter. Patients can change MCOs during annual enrollment periods, and the Dual Demo transition in January 2026 caused many patients to receive new MCO assignments.