How to start an IOP or PHP in Houston

Houston at a glance

Question	Houston's answer
State license	HHSC chemical dependency treatment facility license for each site (same statewide rule, 26 TAC 564)
Medicaid service area	Harris: Austin, Brazoria, Fort Bend, Galveston, Harris, Matagorda, Montgomery, Waller and Wharton counties
STAR plans	Community Health Choice, Molina, Texas Children's Health Plan, UnitedHealthcare Community Plan, Wellpoint
STAR+PLUS plans	Community Health Choice, Molina, UnitedHealthcare Community Plan
CHIP / STAR Kids	CHIP: Community Health Choice, Molina, Texas Children's, UnitedHealthcare, Wellpoint. STAR Kids: Texas Children's, UnitedHealthcare, Wellpoint
Local mental health authority	The Harris Center for Mental Health and IDD (Harris County); Gulf Coast Center serves Brazoria and Galveston counties
OSAR (state-funded SUD screening and referral)	The Council on Recovery (Harris County); Gulf Coast Center (Brazoria and Galveston)
Building permits and certificate of occupancy	City of Houston: the Houston Permitting Center. Suburbs and unincorporated areas: that city or the county
Local watch-outs	Deed restrictions, mapped floodplains, hurricane season (June 1 to November 30)

Plan line-ups are from HHSC's managed care service areas map (revised August 2026, "MCOs serving clients as of September 2026") and HHSC's STAR Kids plan codes. They change with HHSC's contracts, so check before you apply.

The license doesn't change by city

Texas licenses substance use programs at the state level, so a Houston address doesn't add a city treatment license. Under Health and Safety Code chapter 464 and 26 TAC chapter 564, HHSC licenses the program as a chemical dependency treatment facility before it treats anyone. As of October 2026 the fee under 26 TAC 564.408 is $1,200, plus $125 for each additional site at a separate address. That matters in a spread-out metro: a second clinic in Katy or The Woodlands is another site on the license, with its own building approvals.

The statewide steps (the forms, the operational plan, the six-month window to show compliance) are in our Texas CDTF license guide and the full how to start an IOP or PHP in Texas roadmap. A mental-health-only program follows different rules; see licensing a mental health IOP or PHP in Texas.

The building: no zoning isn't no rules

Houston is famous for having no citywide zoning ordinance. That removes one hurdle, a use-district map that might ban a treatment program, but it doesn't make any building licensable. Three things still decide whether a site works:

• Deed restrictions. Many Houston properties carry private deed restrictions that limit what a building can be used for. Have your attorney or title company pull them before you sign a lease. A landlord's "no problem" isn't a title search.
• The certificate of occupancy. Inside city limits, building permits and certificates of occupancy run through the Houston Permitting Center, the City of Houston's permitting office (start at houstontx.gov). A change in how a space is used, from retail or general office to group-room health care, can mean plan review, permits for the build-out, inspections and a new certificate of occupancy for your use and headcount.
• Which jurisdiction you're in. The Harris service area is nine counties. Sugar Land, Pearland, Conroe, League City and the other suburbs are separate cities with their own permit offices and, often, their own zoning. Unincorporated addresses go through the county. Confirm the jurisdiction from the address before you assume Houston's rules apply.

Ask the permit office these questions in writing before you sign, and keep the answers for HHSC and your accreditor:

1. What occupancy classification does an outpatient substance use treatment program with group rooms fall under at this address?
2. Does the current certificate of occupancy cover that use and our expected number of people, or do we need a new one?
3. What permits, plan review and inspections will the build-out need, and roughly how long does review take right now?
4. Is the property in a mapped floodplain, and would our build-out trigger floodplain review?
5. When does the fire marshal inspect, and what will they check (exits, alarms, extinguishers, emergency lighting)?

Then put a way out in the lease if the certificate of occupancy or the license falls through, with free rent during the build-out. Our Texas IOP opening checklist has every site step in order.

Floodplain and hurricane planning

Flooding is the Houston-specific risk most new owners underrate. Before you sign, look up the address on FEMA's Flood Map Service Center check the Harris County Flood Control District's flood information, and ask the permit office whether the site is in a mapped floodplain. Inside a floodplain, the City of Houston's floodplain rules can apply to new construction and to substantial improvements, which affects the build-out budget.

• Insure the contents and the income. Ask your agent about flood coverage for furniture, computers and records, and business-interruption coverage. A standard commercial policy may exclude flood.
• Write the hurricane plan into your emergency plan. The Atlantic hurricane season runs June 1 to November 30. Your emergency operations plan needs a closure decision, client notification, telehealth continuity, and where the records and medications go. Comply's guides cover the emergency operations plan and the hazard vulnerability analysis accreditors ask for; in Houston, flooding and hurricanes usually top the list.
• Don't let a storm close you for good. HHSC retires a site's license when services stop there for more than 60 days unless you've asked for inactive status (26 TAC 564.406). If a flood forces a move, our guide to relocating a treatment program covers the filings.

Medicaid plans in the Harris service area

Most Texas Medicaid members are in managed care, so after you enroll with TMHP you credential separately with each plan you want. TMHP has said Medicaid substance use treatment may only be delivered in a licensed chemical dependency treatment facility (TMHP notice), so the program applies for a facility contract once the HHSC license is issued. The step-by-step is in our Texas Medicaid credentialing guide.

Program	Who it covers	Plans in the Harris service area
STAR	Most children, pregnant women and some families	Community Health Choice, Molina, Texas Children's Health Plan, UnitedHealthcare, Wellpoint
STAR+PLUS	Adults with disabilities and adults 65 and older	Community Health Choice, Molina, UnitedHealthcare
STAR Kids	Children and young adults with disabilities	Texas Children's Health Plan, UnitedHealthcare, Wellpoint
CHIP	Children in families that earn too much for Medicaid	Community Health Choice, Molina, Texas Children's Health Plan, UnitedHealthcare, Wellpoint

• Adult program? Community Health Choice, Molina and UnitedHealthcare are the plans in both STAR and STAR+PLUS here, so they're the usual first three. UnitedHealthcare manages behavioral health through Optum, which is a separate contracting conversation (see behavioral health carve-outs).
• Adolescent program? Texas Children's Health Plan appears in STAR, STAR Kids and CHIP, so it belongs on an adolescent program's list along with Wellpoint and UnitedHealthcare.
• Watch the contract status. HHSC's last STAR and CHIP procurement was stopped by a Travis County court injunction after a suit by plans including Texas Children's Health Plan, Wellpoint and Superior (Fierce Healthcare), and the 2025 Legislature left the procurement in place (Texas Managed Care Alliance recap). The plans above are serving members as of HHSC's map, but check the status before you build a payer mix around one plan.

Commercial plans are usually the bigger share for a private IOP. Which ones to approach first, and how facility contracts work, is in insurance contracts for treatment centers; we file and follow every application in our credentialing service.

The local landscape

Houston has every kind of referral source a program works with. Build the relationships on fast admissions, honest level-of-care calls and good communication, never on payment: the Texas Patient Solicitation Act and federal EKRA ban paying or giving anything of value for referrals (our patient brokering guide explains both). We never arrange referrals for clients.

• Hospital systems. Harris Health (the county's public system), the Texas Medical Center hospitals and the large private systems discharge patients who need a step-down level of care. Their social workers and case managers want to know your levels of care, your accepted plans, and how fast you can do an assessment.
• The local mental health authority. The Harris Center for Mental Health and IDD is Harris County's authority for public mental health services. In Brazoria and Galveston counties it's Gulf Coast Center. They're partners for crisis follow-up and for clients who need public services you don't offer.
• OSAR. HHSC funds Outreach, Screening, Assessment and Referral programs that connect people to state-funded substance use treatment (HHSC OSAR page). In Harris County that's The Council on Recovery. Know them, and know whether you'll take state-funded clients at all.
• Courts and probation. Harris County runs specialty courts, including drug courts, under Government Code chapter 123. Attendance and progress reports to a court need the client's written consent under 42 CFR Part 2.
• Outpatient clinicians, EAPs and detox units refer clients who need more structure than weekly therapy. A one-page sheet with your schedule, levels of care and plans does more than lunches.

Marketing a program legally, including directories and paid search, is covered in how to market a treatment center.

The order of work in Houston

Step	Houston detail	Typical time in our roadmap
1. Program model and budget	Pick levels of care and payers by what the Harris-area plans and your commercial targets pay. Use the break-even calculator.	1–2 months
2. Site search	Deed restrictions, floodplain, jurisdiction, the five permit questions above	about 30 days
3. Lease with a contingency	Out if the certificate of occupancy or license fails; free rent for the build-out	about 3 weeks
4. Build-out	Permits from the city that has jurisdiction; floodplain review if it applies	about 6 weeks
5. Certificate of occupancy and fire inspection	Keep both for HHSC and the accreditor	about 3 weeks
6. HHSC license and inspection	Same statewide process; file when the site and policies are nearly ready	about 2–3 months
7. Facility contracts	TMHP, then the Harris-area Medicaid plans you chose, and commercial plans	about 90 days each

The times are the planning figures in our own launch roadmap, not promises; the city, HHSC and the plans set their own pace. What it all costs is in how much it costs to start an IOP.

Or book a free 30-minute call and tell us the address you're looking at.

Questions

Does Houston require a city license to run an IOP?

The treatment license is the state's: HHSC licenses Texas substance use programs as chemical dependency treatment facilities. The City of Houston's part is the building: permits for the build-out, the certificate of occupancy and the fire inspection. Suburbs and unincorporated areas have their own offices.

Since Houston has no zoning, can I open a program anywhere?

No. Private deed restrictions limit the use of many properties, the certificate of occupancy has to match your use, and floodplain rules can affect a build-out. Check all three, in writing, before you sign a lease.

Which Medicaid plans should a Houston IOP apply to first?

For adults, the plans in both STAR and STAR+PLUS in the Harris service area: Community Health Choice, Molina and UnitedHealthcare (through Optum for behavioral health). For adolescents, add Texas Children's Health Plan and Wellpoint. Ask each plan whether its behavioral health network is open before you apply, and confirm the current line-up with HHSC.

Is Montgomery or Fort Bend County in the same Medicaid service area as Houston?

Yes. HHSC's Harris service area covers Austin, Brazoria, Fort Bend, Galveston, Harris, Matagorda, Montgomery, Waller and Wharton counties, so the same Medicaid plans serve those counties. The building rules are different, though: each city and county has its own permit office.

How long does it take to open an IOP in Houston?

Plan on roughly nine to twelve months from first decisions to a full caseload of insured clients. The building, the HHSC license and the facility contracts happen mostly in sequence, and the contracts usually take longest.

Looking at another Texas metro? See all six city guides on opening a program in Texas, by city, including Dallas and San Antonio.

Cima Consulting isn't a law or accounting firm. HHSC, the City of Houston and each health plan make their own decisions; we don't guarantee approvals, rates or dates.

Sources

• HHSC, Managed Care Service Areas map (revised August 2026): hhs.texas.gov; Health Plans by Service Areas: hhs.texas.gov
• HHSC STAR Kids Handbook, Appendix XI, plan codes and Harris service area counties: fhb.hhs.texas.gov; Molina CHIP service area (Harris counties): molinahealthcare.com
• HHSC, Outreach, Screening, Assessment and Referral: hhs.texas.gov; The Council on Recovery and Gulf Coast Center OSAR listings: findhelp.org, findhelp.org
• Texas Health and Safety Code chapter 464: statutes.capitol.texas.gov; 26 TAC 564.406 and 564.408: 564.406, 564.408
• TMHP, substance use disorder benefit changes: tmhp.com
• STAR/CHIP procurement injunction: Fierce Healthcare; 2025 session recap: Texas Managed Care Alliance
• FEMA Flood Map Service Center: msc.fema.gov; Harris County Flood Control District: hcfcd.org
• Texas Occupations Code chapter 102: statutes.capitol.texas.gov; 18 U.S.C. 220 (EKRA): law.cornell.edu; Government Code chapter 123: statutes.capitol.texas.gov; 42 CFR Part 2: ecfr.gov