Behavioral Health Carve-Outs: How to Verify Mental Health Benefits and Copays

Updated November 9, 2026, based on CAQH CORE, CMS, HHS's HIPAA operating rules regulation, the Department of Labor's parity regulation, Pennsylvania's Department of Human Services, UnitedHealthcare and Blue Shield of California as of that date.

A behavioral health carve-out means the patient's medical plan has handed its mental health and substance use benefits to a separate administrator. That administrator often has its own network, its own portal or phone line, and its own answer on copays and authorizations. To verify the benefit, find out who administers it, then check the outpatient mental health benefit with that entity, not only with the medical plan.

A standard eligibility check often misses the carve-out. The 271 response your system receives can show active medical coverage and a primary care copay while leaving the mental health copay blank. Industry rules allow that, and some carve-outs show up only as a pointer to another entity.

This guide covers how a carve-out looks in the 271 and on the payer's screens, how Medicaid carve-outs differ, and the checks to run before the first visit.

A carve-out moves the benefit to a separate administrator

The member's card and plan name usually belong to the medical plan. The behavioral health benefit is run by someone else. Blue Shield of California's provider guide shows a typical case. After you check eligibility and open the outpatient mental health benefit, the screen notes that Blue Shield's Mental Health Service Administrator (MHSA) "administers Mental Health and Substance Use Disorder services." The guide adds that "the MHSA Participating Provider network is separate from Blue Shield's Participating Provider network." When the MHSA appears on that screen, the guide says you need a contract with Magellan to see the member in network. (Blue Shield of California's mental health eligibility steps)

Many carve-out problems start here. A practice can be in network with the medical plan and out of network with the behavioral health administrator, or the reverse. Staff who verify against the medical plan alone may collect the wrong copay, skip a required authorization, or bill an entity that won't pay the claim.

Exceptions exist even inside one plan. The same Blue Shield guide says mental health services provided through its telehealth vendor "are administered by Blue Shield, not the MHSA." Telehealth and in-person therapy may sit with different entities, so check each one the patient will use.

Why the standard eligibility check comes back incomplete

The HIPAA 271 must carry what the federally adopted CAQH CORE operating rules require. HHS adopted the 2011 Phase I and Phase II versions of those rules. (HHS's eligibility operating rules regulation, 45 CFR 162.1203) Those rules let a plan leave out patient cost details for several behavioral health service types. The CORE Phase II data content rule lists MH (Mental Health), A6 (Psychotherapy), A7 (Psychiatric Inpatient), A8 (Psychiatric Outpatient) and AI (Substance Abuse) as discretionary, along with a few non-behavioral codes such as vision and pharmacy. (CAQH CORE's Phase II eligibility data content rule)

CORE gives three reasons for the discretionary list. One is that a code "is typically a 'carve-out' benefit" where the information "is not available to the health plan or information source." CORE's example there is vision. Another is that behavioral health codes raise privacy issues that may limit what a plan can return. CAQH CORE's newer version of the rule, EB.2.1, keeps these reasons and also lets a plan leave out telemedicine and authorization details for discretionary codes. Even when a plan uses that discretion, the rule says "the coverage status of the specific benefit (service type) must be returned." (CAQH CORE's eligibility data content rule, version EB.2.1) So "active" with no copay is a compliant answer. Our guide to what a 271 eligibility response leaves out covers these rules in more detail.

Some payers name the carve-out administrator in the 271. UnitedHealthcare's 270/271 companion guide says a benefit segment "with the vendor's name will be included in the 271 when a benefit is administered by another vendor." Its example uses EB01 = U, "Contact following vendor," followed by a 2120 loop with an NM1 segment that carries the vendor's name. The guide's example is a dental vendor, and the same guide says category inquiries, which include Mental Health, return a list of service types "unless the benefit is serviced by a vendor." (UnitedHealthcare's 270/271 companion guide)

Many EHR and practice management screens show a summary, not the raw 271. If the screen shows primary care and specialist copays and nothing for mental health, open the full response and look for a U segment or a named entity before you conclude the plan has no behavioral health benefit.

Medicaid carve-outs follow the state's design

In Medicaid, the state decides whether behavioral health sits with the medical managed care plan or with a separate entity. Pennsylvania carves it out. Its Department of Human Services says each county contracts with a managed care organization for mental health and drug and alcohol services, and "each HealthChoices consumer is assigned a Behavioral Health Managed Care Organization (BH-MCO) based on his or her county of residence." (Pennsylvania DHS on Behavioral HealthChoices)

A Pennsylvania Medicaid patient therefore has two plans to confirm: the physical health plan and the county's BH-MCO. Because assignment follows county of residence, a move to another county can change the BH-MCO. Other states split the benefit differently, so read your state Medicaid agency's managed care pages before you set up a checklist. For the medical side, our guide to confirming Medicaid managed care and IPA assignment walks through the plan layer.

How to verify a carved-out benefit before the visit

Run these checks at intake and again before the first appointment:

1. Read the member card front and back. Look for a separate behavioral health or mental health phone number, administrator name or payer ID. Treat it as a lead to confirm, since cards can be out of date.
2. Send an explicit inquiry. Ask for MH or A8, not only service type 30. UnitedHealthcare's guide says that when an explicit code isn't supported, a generic response is returned instead.
3. Read the full 271. Look for EB01 = U, a 2120 loop naming another entity, or mental health coverage marked active with no amounts.
4. Go to the administrator. Use its portal or provider line to confirm the outpatient mental health benefit for the date of service.
5. Confirm your network status with that entity. Credentialing with the medical plan doesn't cover a separate behavioral health network. If you aren't contracted with the administrator, our guide to payer enrollment timelines explains what to expect.
6. Record the benefit details. Capture the copay or coinsurance, the deductible and what has been met, any visit limits, whether authorization is required, and whether telehealth is covered and by whom.
7. Confirm where the claim goes. Get the claims payer ID and address from the administrator, and note the call reference number or portal screenshot.

Re-check when the plan year turns over, when the patient changes plans, and for Medicaid patients, when they move. Our guide on how often to verify insurance eligibility covers timing.

What parity tells you about the copay, and what it doesn't

Staff sometimes expect the therapy copay to match the primary care copay. Federal parity law doesn't promise that. CMS explains that under the Mental Health Parity and Addiction Equity Act, financial requirements such as coinsurance and copays on mental health and substance use benefits "cannot be more restrictive than the predominant financial requirements" applied to substantially all medical and surgical benefits in the same classification. (CMS on the Mental Health Parity and Addiction Equity Act)

The regulation sets the classifications, such as outpatient in network and outpatient out of network. A plan may split outpatient benefits into office visits and all other outpatient services, but "separate sub-classifications for generalists and specialists, are not permitted." The regulation also treats a group plan's combined medical and behavioral health arrangements as "a single group health plan," and its examples say a separate deductible for mental health benefits violates the rule. (29 CFR 2590.712, the Department of Labor's parity regulation)

At the front desk, this matters in two ways. Parity doesn't tell you the copay amount, so you still have to look it up. And if the administrator quotes a behavioral health deductible that seems to ignore what the patient has met on the medical side, ask both entities which figure is current.

Parity doesn't apply everywhere in the same way. CMS notes that MHPAEA doesn't apply directly to small group plans, though the Affordable Care Act's essential health benefit rules apply its requirements indirectly. CMS also says Medicare, Medicaid and CHIP are not group health plans, though CHIP, Medicaid benchmark plans and Medicaid managed care plans must comply with certain MHPAEA requirements. (CMS on the Mental Health Parity and Addiction Equity Act) Confirm the patient's actual benefit rather than assuming parity settles it.

Frequently asked questions

Why does the eligibility check show a primary care copay but no mental health copay?

Under CAQH CORE rules, mental health and psychotherapy are discretionary service types. A plan may return coverage status for them without the copay, coinsurance or deductible. CORE's reasons include carve-outs, where the plan doesn't hold the benefit details, and privacy limits on behavioral health information. Check the full 271 for a named entity, then confirm with that administrator.

How do I know which entity to bill for therapy?

Check the member card, the full 271 and the medical plan's benefit screen for a behavioral health administrator. If one is named, confirm the claims payer ID and address with it before the visit. For Medicaid, check whether your state carves behavioral health out to a separate plan.

We're in network with the medical plan. Are we in network for behavioral health?

Not necessarily. A carve-out administrator can run its own provider network, as Blue Shield of California's guide says its MHSA does. Confirm your contract status with the administrator itself.

Are telehealth therapy visits handled by the same administrator?

Not always. Blue Shield of California's guide, for example, says mental health visits through its telehealth vendor are administered by Blue Shield, not its MHSA. Ask whether telehealth is covered and which entity pays for it.

Does parity mean the therapy copay equals the primary care copay?

No. Parity compares mental health cost sharing with the predominant level for medical and surgical benefits in the same classification. The amount still varies by plan, so look it up for each patient.

Checking behavioral health benefits across payer portals?

Champ automates portal work like eligibility and benefit checks across payer portals. We set it up and run it, so your staff sees only the finished results. If carved-out mental health benefits keep sending your team to separate portals and phone lines, learn more here.

This post is general information, not legal, compliance or billing advice. Rules vary by payer, plan and state and change often, so confirm benefits and billing details with the plan or its behavioral health administrator before acting. Champ is not affiliated with or endorsed by CAQH, CMS, HHS, the Department of Labor, Pennsylvania's Department of Human Services, UnitedHealthcare or Blue Shield of California.