New York has entered into a court-mandated settlement requiring the state to guarantee that children on Medicaid receive timely, intensive mental health services within their own homes and communities.
Under this agreement, filed in U.S. District Court by New York’s Department of Health and Office of Mental Health, the state must begin significant improvements to the delivery of mental health care for its most vulnerable youth. Nearly half of New York’s children—over 2.5 million—are covered by Medicaid, and many have long struggled to access adequate in-home and neighborhood care, relying instead on hospitals or institutional placements that experts say can exacerbate trauma and remove children from essential family support.
Plaintiffs’ attorney Steven Holinstat called the settlement “a good day for the thousands of children with serious mental health conditions living in communities across New York State,” emphasizing that these children “have waited long enough” for the care they deserve.
The settlement—spanning 52 pages—lays out a detailed action plan over the next 18 months. Among its key requirements:
- Develop a coordinated plan for in‑home behavioral health services and intensive care coordination.
- Create a crisis intervention strategy that does not depend on police involvement.
- Raise Medicaid reimbursement rates for providers of children’s mental health services.
- Conduct annual quality audits of these services to ensure accountability and improvement.
A spokesperson for the Office of Mental Health, Justin Mason, expressed hope for a “amicable resolution,” stressing the agency’s continued collaboration with the Department of Health to ensure effective, community-based mental health services for all youth, including those on Medicaid.
The lawsuit, C.K. v. McDonald, was filed in 2022 by two law firms and advocacy groups Disability Rights New York and Children’s Rights. The plaintiffs alleged systemic failures by the state to provide sufficient mobile crisis and intensive mental health services, forcing families onto long waitlists and into institutional settings.
Parents who contributed to the lawsuit described harrowing experiences, including one mother who recounted her daughter being placed in emergency psychiatric units and residential facilities—even being physically and medically restrained, with forced virtual-only visits during the pandemic. The lack of local, timely support left her family traumatized and desperate.
While this settlement awaits final court approval, the agreement signals a potentially transformative shift in how New York serves children in crisis. One mother, whose daughter has since returned home after years in residential treatment, expressed hope that this settlement will prevent future families from enduring similar trauma: “I’m hopeful for the thousands of children and family members across the state that continue to lack appropriate, intense mental health services… I’m hopeful for families that are able to build resilience and heal appropriately”.