Medicaid Peer Support Services for Recovery Housing: Complete State-by-State Guide

Medicaid covers peer support services in 48 states and the District of Columbia as of 2026, but coverage for sober living homes varies significantly by state. Some states offer broad, unrestricted reimbursement for peer support in recovery residences. Others limit coverage to clinical settings, impose session caps, or require affiliation with specific state agencies. For sober living operators, understanding the landscape is the difference between a viable new revenue stream and wasted time pursuing coverage that does not apply to your setting.

This guide consolidates everything you need to know about Medicaid peer support billing for recovery housing into one comprehensive resource. Whether you operate a single sober living home or manage a portfolio of recovery residences, use this guide to evaluate coverage in your state, identify the correct billing codes, understand certification requirements, and build a compliant peer support program that generates sustainable revenue.

Table of Contents

• Understanding Medicaid Peer Support Services
• State-by-State Coverage Database
  • Northeast Region
  • Southeast Region
  • Midwest Region
  • Western Region
• Billing Codes Deep Dive
• Certification Requirements for Peer Support Specialists
• Implementation Guide for Sober Living Operators
• Revenue Impact Analysis
• Compliance and Documentation Requirements
• Conclusion

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Understanding Medicaid Peer Support Services

What Are Peer Support Services?

Peer support services are non-clinical recovery services delivered by individuals with lived experience in addiction and recovery. Unlike traditional clinical interventions provided by licensed counselors or therapists, peer support leverages the shared experience of recovery to build trust, provide encouragement, and help residents navigate the practical challenges of early sobriety.

In a sober living context, peer support specialists typically provide:

• One-on-one recovery coaching — goal-setting, crisis navigation, and accountability
• Group facilitation — structured recovery meetings, life skills workshops, and community building
• Resource navigation — connecting residents with employment services, housing resources, healthcare, and community support
• Recovery planning — developing and maintaining individualized recovery plans
• Mentoring — modeling recovery behaviors and sharing lived experience

For a deeper look at how peer support fits within recovery housing levels, see our post on NARR certification standards. NARR Level 3 and Level 4 homes routinely incorporate peer support as a core service offering.

History and the 2026 Landscape

Peer support services gained federal legitimacy in 2007 when the Centers for Medicare & Medicaid Services (CMS) issued a letter to state Medicaid directors clarifying that peer support could be covered under Medicaid rehabilitation services. Since then, state adoption has accelerated dramatically:

Year	States with Coverage	Key Development
2007	~12 states	CMS clarifying letter issued
2010	~20 states	ACA expansion increased Medicaid enrollment
2015	~35 states	SAMHSA best practices published
2020	~42 states	COVID telehealth flexibilities expanded access
2023	~46 states	Illinois and several others added full coverage
2026	48 states + DC	Only Wyoming and South Dakota lack formal programs

The trajectory is clear: peer support is becoming standard in Medicaid behavioral health coverage. For sober living operators, this means an expanding opportunity to generate revenue while improving resident outcomes.

Why This Matters for Recovery Housing

According to SAMHSA’s Best Practices for Recovery Housing, peer support services are increasingly considered an essential component of quality recovery residences. Research consistently shows that effective peer support interventions are associated with fewer relapses, better treatment retention, higher-quality relationships with providers, and improved satisfaction with the recovery experience.

For operators, the business case is straightforward: peer support services create a billable revenue stream that also improves resident outcomes, reduces turnover, and strengthens referral relationships with treatment centers and courts. For more on building referral networks, see our referral networks and partnerships guide.

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State-by-State Coverage Database

The following tables cover all 50 states plus the District of Columbia, organized by region. Coverage statuses are defined as:

• Full — Medicaid covers peer support with no significant limitations or copays
• Partial — Coverage exists but with meaningful restrictions (session caps, setting limitations, or copay requirements)
• Limited — Coverage is restricted to specific state-affiliated programs or narrow provider types
• None — No formal Medicaid peer support program exists

All reimbursement rates are approximate and subject to change. Always verify current rates with your state Medicaid program.

Northeast Region

The following table summarizes peer support coverage across the Northeast region.

State	Coverage	Primary Code	Rate (per 15 min)	Copay	Key Notes
Connecticut	Full	H0038	~$18-22	None	Covered under behavioral health partnership; no session limits
Delaware	Full	H0038	~$15-19	None	Covered through managed care organizations
Maine	Full	H0038	~$14-17	None	MaineCare covers without limitation; rural access programs available
Maryland	Full	H0038	~$16-20	None	Certified Recovery Specialists covered since spring 2023; no copay
Massachusetts	Full	H0038	~$20-28	None	MassHealth covers recovery coaching and support navigation without limits
New Hampshire	Full	H0038	~$15-18	None	Covered under SUD treatment continuum; recovery-friendly employer integration
New Jersey	Full	H0038	~$18-24	None	Strong recovery housing infrastructure; peer support in residential settings covered
New York	Full	H0038	~$22-32	None	No limitations; comprehensive coverage across settings including recovery residences
Pennsylvania	Partial	H0038	~$16-22	$0.65/unit (non-MCO)	Managed care patients no copay; all others $0.65 per unit
Rhode Island	Full	H0038	~$16-20	None	Covered through Medicaid managed care; recovery community organizations supported
Vermont	Full	H0038	~$15-19	None	Vermont Medicaid covers through designated agencies; strong community recovery focus

Northeast highlights: This region has some of the strongest peer support coverage in the country. New York and Massachusetts stand out with high reimbursement rates and no limitations. Pennsylvania is the only state requiring any copay, and even that applies only to non-managed-care enrollees.

For state-specific business guidance, see our posts on opening a sober living home in New York, opening in New Jersey, and opening in Pennsylvania. Massachusetts and Maryland coverage details are included in the tables above.

Southeast Region

State	Coverage	Primary Code	Rate (per 15 min)	Copay	Key Notes
Alabama	Full	H0038	~$13-16	Dual-coverage only	Full coverage; copay only for dual-eligible individuals
Arkansas	Full	H0038	~$12-15	None	Medicaid expansion broadened access; peer support covered under SUD benefits
Florida	Partial	H0038	~$18-25	None	Limited to 1 unit per day per calendar year without prior authorization
Georgia	Full	H0038	~$15-20	None	Pioneer state with 20+ years of peer support; $20M+ annual investment; multiple specializations
Kentucky	Full	H0038	~$14-18	None	Strong peer support infrastructure; covered through managed care organizations
Louisiana	Full	H0038	~$14-17	None	Covered under Medicaid expansion; growing peer workforce
Mississippi	Partial	H0038	~$12-15	None	Coverage exists but limited provider network; growing program
North Carolina	Partial	H0038	~$15-20	None	24 units without prior auth; up to 270 units in 90 days with auth
South Carolina	Limited	H0038	~$14-17	None	Only reimbursed through SCDMH-affiliated programs
Tennessee	Full	H0038	~$15-19	None	TennCare covers; H0038 limited to 4 units per day; H0038HQ for groups
Virginia	Full	H0038	~$16-20	None	DMAS covers peer support broadly; strong recovery community network
West Virginia	Full	H0038	~$13-16	None	Covered through Medicaid managed care; opioid crisis response strengthened programs
District of Columbia	Full	H0038	~$20-26	None	Comprehensive coverage; strong integration with behavioral health system

Southeast highlights: Georgia is a national leader with over two decades of peer support investment and multiple certification specializations. Florida’s per-day unit limit can be a significant constraint for intensive programs. South Carolina’s restriction to state-affiliated programs is a barrier for private operators. Coverage details for all these states are included in the tables above.

For state-specific startup guidance, see our guides on opening a sober living home in Texas, Georgia, Kentucky, Mississippi, Louisiana, Arkansas, and Florida.

Midwest Region

The following table covers Midwest state coverage and billing codes.

State	Coverage	Primary Code	Rate (per 15 min)	Copay	Key Notes
Illinois	Full	H2014	~$16-22	None	Uses H2014 (not H0038); full coverage since 2023 after pilot program
Indiana	Partial	H0038	~$14-18	HIP plan copay	MRO coverage varies by diagnosis; HIP patients have cost-sharing
Iowa	Full	H0038	~$14-17	None	Covered under integrated health homes and SUD treatment
Kansas	Full	H0038	~$13-16	None	KanCare covers peer support; growing workforce development programs
Michigan	Full	H0038	~$16-22	None	Called “peer recovery coaching”; no limits or copays
Minnesota	Partial	H0038	~$18-24	None	Covers “Peer Recovery Support”; 14 hrs/week cap under review; tiered rates proposed
Missouri	Full	H0038	~$14-18	None	Covers telehealth peer support (modifier GT); strong access
Nebraska	Full	H0038	~$13-16	None	Heritage Health managed care covers peer support
North Dakota	Full	H0038	~$14-17	None	Covered under behavioral health benefit; smaller peer workforce
Ohio	Full	H0038	~$16-20	None	Full coverage without limitations; strong recovery support infrastructure
South Dakota	None	N/A	N/A	N/A	No formal Medicaid peer support program as of 2026
Wisconsin	Limited	H0038	~$15-19	None	Only covered under State Plan organizations (psychosocial rehab, residential SUD, health homes)

Midwest highlights: Illinois is notable for using H2014 instead of the more common H0038. Minnesota’s program is in flux with proposed legislation to cap weekly hours and implement tiered reimbursement. Wisconsin’s State Plan restriction effectively excludes many private sober living operators. South Dakota remains one of only two states without a formal program. Indiana and Missouri specifics are included in the tables above.

For state startup guidance, see our posts on opening a sober living home in Michigan and business startup tips for Tennessee.

Western Region

State	Coverage	Primary Code	Rate (per 15 min)	Copay	Key Notes
Alaska	Full	H0038	~$18-24	None	Higher rates reflect cost of living; covered through behavioral health grants and Medicaid
Arizona	Full	H0038	~$15-19	None	AHCCCS covers peer support; integrated with behavioral health system
California	Full	H0038	~$22-35	None	Medi-Cal covers MH and SUD peer support without limitation; highest rates nationally
Colorado	Full	H0038	~$16-22	None	No licensing requirements for peer specialists; broad coverage without limitations
Hawaii	Full	H0038	~$17-22	None	Med-QUEST covers peer support; island-specific access considerations
Idaho	Partial	H0038	~$13-16	None	Coverage exists but limited rural provider infrastructure
Montana	Full	H0038	~$14-18	None	Medicaid expansion improved access; tribal health integration
Nevada	Full	H0038	~$15-20	None	Covered under Medicaid managed care; growing Clark County infrastructure
New Mexico	Full	H0038	~$15-19	None	Centennial Care covers peer support; strong community health worker integration
Oregon	Full	H0038	~$17-23	None	OHP covers peer-delivered services broadly; strong recovery community
Texas	Partial	H0038	~$15-20	None	104 units per 6-month period without medical necessity documentation
Utah	Full	H0038	~$14-18	None	Covered under Medicaid managed care; growing program
Washington	Full	H0038	~$18-25	None	Apple Health covers peer support; robust certification program
Wyoming	None	N/A	N/A	N/A	No formal Medicaid peer support program as of 2026

Western highlights: California leads the nation with the highest reimbursement rates, reflecting both cost of living and the state’s commitment to peer support infrastructure. Colorado stands out for having no licensing requirements for peer specialists, lowering barriers to entry. Texas imposes a 104-unit cap per six months that operators must plan around. Wyoming joins South Dakota as the only states without formal coverage.

For state-specific guidance, see our posts on opening a sober living home in California and opening a sober living home in Texas.

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Billing Codes Deep Dive

Getting the billing codes right is fundamental to clean claims and timely reimbursement. While most states use H0038, the modifier landscape and state-specific alternatives add complexity that every billing team needs to understand.

Primary HCPCS Codes

Code	Description	Unit	Typical Use
H0038	Self-help/peer services, per 15 minutes	15 min	Individual peer support (most states)
H0039	Assertive community treatment, face-to-face, per 15 minutes	15 min	Community-based peer support
H2014	Skills training and development, per 15 minutes	15 min	Illinois and select states
T1012	Alcohol/drug services, sub-acute detox, per diem	Per diem	Some states for residential settings
H0025	Behavioral health prevention education, per session	Per session	Group psychoeducation by peers

Essential Modifiers

Modifiers tell the payer about the specific context of the service. Using the wrong modifier, or omitting one that is required, is a leading cause of claim denials.

Modifier	Meaning	When to Use
HF	Substance abuse program	When services are part of a formal SUD treatment program
HQ	Group setting	Group peer support sessions
GT	Telehealth/telemedicine	Virtual peer support sessions
U1-U9	State-defined modifiers	Varies by state; check your state Medicaid manual
52	Reduced services	Session shorter than standard unit
59	Distinct procedural service	When billing multiple services same day

Common Billing Mistakes

1. Using HF when not in a treatment program — Many sober living homes are not licensed addiction treatment programs. If yours is not, omit the HF modifier. Misrepresenting your facility type can trigger audits.

2. Billing without active certification — Claims submitted for services delivered by staff whose certification lapsed will be denied and may trigger recoupment of previous payments.

3. Incorrect units — H0038 is per 15 minutes. A 45-minute session is 3 units, not 1. Underbilling leaves money on the table; overbilling invites fraud investigations.

4. Missing prior authorization — States like North Carolina require prior authorization beyond initial units. Billing without authorization results in automatic denials.

5. Telehealth without GT modifier — If your peer specialist conducts sessions remotely, the GT modifier is required in most states. Missouri explicitly accepts this, but verify for your state.

For general billing and invoicing workflows, explore Sober Living App’s billing features. For a complete billing operations guide, see our Sober Living Home Billing Guide.

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Certification Requirements for Peer Support Specialists

Every state that covers peer support services under Medicaid requires the person delivering those services to hold some form of certification. The specific title, training hours, and renewal requirements vary, but the core structure is consistent.

Universal Requirements

Across nearly all states, peer support specialists must demonstrate:

1. Lived experience — Personal history of addiction recovery (typically 1-2 years minimum)
2. Training completion — State-approved training program (40-75 hours is typical; some states require more)
3. Examination — Written or oral competency exam
4. Supervision — Ongoing clinical supervision by a licensed professional
5. Continuing education — Annual CE credits for certification renewal

Certification Titles by State

States use different titles for what is essentially the same role. The most common include:

Title	States Using It
Certified Peer Support Specialist (CPSS)	AL, AZ, CO, GA, KY, MD, MO, NC, NJ, OH, TN, VA, WV
Certified Peer Recovery Specialist (CPRS)	FL, LA, MS, TX
Certified Recovery Support Specialist (CRSS)	IL, NY
Certified Peer Recovery Coach	MI
Certified Peer Support Professional (CPSP)	IN
Certified Recovery Specialist (CRS)	PA
Recovery Support Specialist	MA, MN
Peer Wellness Specialist	OR
Certified Peer Counselor	WA

Training Hour Requirements (Selected States)

State	Required Hours	Supervision Requirement	Renewal Period
California	68 hours	Licensed clinician	2 years
Florida	75 hours	Qualified supervisor	2 years
Georgia	40 hours core + specialization	Licensed professional	1 year
Illinois	100 hours	LCSW or equivalent	2 years
New York	46 hours	Licensed clinician	3 years
Ohio	75 hours	Licensed supervisor	2 years
Pennsylvania	75 hours	Licensed clinician	2 years
Texas	48 hours	LCDC or equivalent	2 years

Building Your Peer Support Team

For sober living operators looking to add peer support services, the staffing path typically follows this sequence:

1. Identify staff with lived experience — Many recovery housing staff already qualify based on personal recovery history
2. Enroll in state-approved training — Programs are available through state certification boards, community colleges, and online platforms
3. Secure supervision arrangements — Partner with a licensed clinician who can provide the required supervision hours
4. Complete certification — Pass the state examination and obtain formal certification
5. Maintain credentials — Track CE requirements and renewal deadlines

For more on building your sober living team, see our staffing guide for sober living homes. Managing staff credentials and certifications is easier with the right software — Sober Living App’s staff management features help you track credentials, supervision hours, and renewal dates in one place.

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Implementation Guide for Sober Living Operators

Adding Medicaid-billable peer support services to your sober living home is a multi-step process. Here is the implementation roadmap, from initial assessment through first billable session.

Step 1: Assess Your State’s Coverage

Before investing time and resources, confirm three things:

• Does your state cover peer support under Medicaid? (Use the tables above)
• Can recovery residences bill for these services, or only clinical treatment programs? (Check state-specific provider enrollment requirements)
• What percentage of your residents are Medicaid-enrolled? (If fewer than 30% are on Medicaid, the revenue potential may not justify the infrastructure investment)

Step 2: Determine Provider Enrollment Path

In most states, sober living homes have two options for billing Medicaid:

Option A: Direct enrollment — Some states allow recovery residences to enroll directly as Medicaid behavioral health providers. This typically requires NARR certification, state certification or licensing, and meeting specific facility standards. States like California, New York, and Florida offer direct enrollment pathways for qualifying facilities.

Option B: Agency partnership — Partner with an enrolled behavioral health agency that employs or contracts your peer support specialists. The agency bills Medicaid, and you negotiate a fee arrangement. This is often the faster path, though you capture less of the reimbursement.

For guidance on structuring these business relationships, see our business plan template for sober living homes.

Step 3: Credential Your Staff

Identify existing staff members with lived recovery experience and support them through the certification process. Budget for:

• Training program fees ($500-2,000 per person)
• Examination fees ($100-300 per person)
• Time away from duties during training (40-100 hours)
• Ongoing supervision costs ($50-150 per supervision session)

Step 4: Establish Documentation Systems

Medicaid billing requires rigorous documentation. Before your first billable session, you need systems for:

• Individual service plans for each resident receiving peer support
• Session notes capturing duration, activities, and progress
• Supervision logs documenting clinical oversight
• Credential tracking for staff certifications and renewals
• Consent forms for Medicaid billing authorization

Sober Living App streamlines this documentation with built-in resident management, notes tracking, and billing automation that integrates with your peer support workflow.

Step 5: Set Up Billing Infrastructure

You will need:

• A National Provider Identifier (NPI) if billing directly
• Electronic claim submission capability (837P format for most states)
• A clearinghouse account for claim routing
• Remittance processing for payment reconciliation

Many sober living operators find that partnering with a billing service or using integrated software is more cost-effective than building billing infrastructure from scratch. Sober Living App’s invoicing tools can help manage the financial side while you focus on resident care.

Step 6: Launch and Monitor

Start with a pilot program:

1. Begin with 3-5 Medicaid-enrolled residents
2. Track claim submission to payment timelines
3. Monitor denial rates and common denial reasons
4. Adjust documentation and coding practices based on feedback
5. Scale the program once clean claim rates exceed 90%

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Revenue Impact Analysis

What can a sober living home realistically expect to earn from adding Medicaid peer support services? The numbers depend on your state’s reimbursement rate, the number of Medicaid-enrolled residents, and the intensity of services provided.

Conservative Revenue Model

Assumptions:

• 20-bed sober living home
• 40% of residents are Medicaid-enrolled (8 residents)
• Each resident receives 3 individual sessions per week (45 minutes = 3 units each)
• Reimbursement rate of $17 per 15-minute unit (national median)

Metric	Calculation	Amount
Units per resident per week	3 sessions x 3 units	9 units
Weekly revenue per resident	9 units x $17	$153
Weekly revenue (8 residents)	$153 x 8	$1,224
Monthly revenue	$1,224 x 4.3 weeks	$5,263
Annual revenue	$5,263 x 12	$63,158

Moderate Revenue Model

Adding group sessions increases revenue with minimal additional staff time:

Additional assumptions:

• 2 group sessions per week (60 minutes = 4 units each)
• 6 Medicaid residents per group on average
• Group rate of $10 per 15-minute unit per participant

Metric	Calculation	Amount
Individual revenue (from above)		$63,158/year
Group units per week per person	2 sessions x 4 units	8 units
Weekly group revenue	8 units x $10 x 6 residents	$480
Annual group revenue	$480 x 4.3 x 12	$24,768
Total annual revenue		$87,926

Expense Considerations

Expense	Estimated Annual Cost
Peer support specialist salary (1 FTE)	$35,000-50,000
Clinical supervision	$5,000-10,000
Training and certification	$2,000-4,000
Billing/administrative costs	$3,000-6,000
Total expenses	$45,000-70,000

Net revenue potential: $18,000-43,000 per year for a 20-bed home with moderate Medicaid enrollment. In states with higher reimbursement rates like California or New York, net revenue can exceed $60,000 annually.

This revenue is incremental to your existing rent and fee income, and it comes with the added benefit of improved resident outcomes and stronger referral relationships. For more on the financial management of recovery housing, see our financial management guide for sober living homes.

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Compliance and Documentation Requirements

Medicaid billing is heavily audited. The combination of federal oversight, state-level requirements, and managed care organization (MCO) rules creates a documentation environment where thoroughness is not optional. Incomplete documentation is the most common reason for claim denials and the primary trigger for recoupment audits.

Required Documentation for Every Billable Session

1. Individual Service Plan (ISP)

   • Must be completed before the first billable session
   • Identifies specific, measurable recovery goals
   • Signed by the resident and the peer support specialist
   • Reviewed and updated at least every 90 days

2. Session Notes

   • Date, start time, and end time of each session
   • Location (in-person, telehealth, community)
   • Activities performed during the session
   • Resident’s response and progress toward ISP goals
   • Plan for next session
   • Peer support specialist signature

3. Supervision Documentation

   • Regular supervision sessions documented (frequency varies by state)
   • Supervisor signature and credentials
   • Discussion of specific cases and clinical concerns
   • Recommendations for service adjustments

4. Credential Files

   • Current certification documentation
   • Training completion records
   • Background check results
   • Annual renewal documentation

5. Consent and Authorization

   • Resident consent for peer support services
   • Medicaid billing authorization
   • Release of information forms as needed
   • Prior authorization documentation (where required)

HIPAA Compliance

Peer support services generate protected health information (PHI) that is subject to HIPAA requirements. Your documentation, storage, and transmission systems must meet HIPAA standards. This is true whether you bill directly or through a partner agency.

For a comprehensive overview of HIPAA requirements for recovery housing, see our HIPAA compliance guide for sober living homes.

Audit Preparedness

Medicaid programs conduct both routine and targeted audits. To be audit-ready:

• Maintain documentation for at least 7 years (some states require 10)
• Ensure every billed unit has a corresponding session note
• Keep credential files current and accessible
• Document your supervision schedule and maintain logs
• Use electronic systems with audit trails when possible

Sober Living App provides the resident management and documentation infrastructure that makes audit preparedness a natural byproduct of daily operations rather than a separate compliance project.

Insurance Coverage

Peer support programs create additional liability exposure. Make sure your insurance coverage accounts for peer-delivered services, especially if your specialists are conducting community outreach or home visits. For guidance on protecting your recovery housing business, see our insurance guide for sober living homes.

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Conclusion

Medicaid peer support services represent one of the most significant revenue opportunities available to sober living operators in 2026. With 48 states and DC now offering some form of coverage, the question for most operators is not whether to pursue peer support billing, but how to implement it effectively.

The keys to success are:

1. Know your state’s rules — Coverage status, billing codes, reimbursement rates, and provider enrollment requirements vary dramatically. Use this guide as your starting point, then verify current details with your state Medicaid program.

2. Invest in certified staff — Credentialed peer support specialists are the foundation of a compliant, billable program. The training investment pays for itself within months of active billing.

3. Build documentation systems first — Clean claims start with clean documentation. Do not begin billing until your documentation workflow is reliable and repeatable.

4. Start small and scale — Pilot with a handful of Medicaid residents, learn from early claims, and expand once you have a proven process.

5. Use technology to your advantage — Manual documentation and billing processes do not scale. Purpose-built software makes the difference between a sustainable program and an administrative burden.

Sober Living App is designed to help recovery housing operators manage the full spectrum of operations, from resident intake and billing to staff coordination and compliance documentation. If you are ready to add peer support services to your recovery housing program, start your free trial and see how the right tools make implementation faster and more sustainable.

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Related guides for sober living home operators:

• Sober Living Home Billing Guide
• HIPAA Compliance for Sober Living Homes
• Sober Living Licensing Requirements by State

Last Updated: February 2026