The development of the Level of Care Utilization System for Psychiatric and Addiction Services (LOCUS) by the American Association of Community Psychiatrists will be described. LOCUS and its derivatives were developed to address some of the weaknesses of proprietary and often self-serving medical necessity criteria, and to provide an objective standard for service intensity decisions. The LOCUS Family of Tools (LFTs) provide a flexible and user-friendly approach to developing service intensity recommendations for persons with either or both psychiatric disorders and addictions. LOCUS provides a quantifiable, dimensional assessment of need and describes a service continuum that includes both clinical and supportive elements in the service array. The simple structure of LOCUS allows for easy conversion of assessment scores to level of care recommendations and provides a framework for progress documentation and treatment planning in which a service user can participate. It reduces the impact of clinician bias regarding treatment recommendations. Developments in the dissemination and ancillary uses of the tools will be described along with discussion of value management.