Background: The impact of the 2019 coronavirus pandemic on the mental health of millions worldwide has been well documented, but its impact on prevention and treatment of mental and behavioral health conditions is less clear. The COVID-19 pandemic also created numerous challenges and opportunities to implement health care policies and programs under conditions that are fundamentally different from what has been considered to be usual care. Methods: We conducted a qualitative study to determine the impact of the COVID-19 pandemic on implementation of evidence-based policy and practice by State Mental Health Authorities (SMHA) for prevention and treatment of mental health problems in children and adolescents. Semi-structured interviews were conducted with 29 SMHA representatives of 21 randomly selected states stratified by coronavirus positivity rate and rate of unmet services need. Data analysis with SMHA stakeholders used procedures embedded in the Rapid Assessment Procedure—Informed Community Ethnography methodology. Results: The need for services increased during the pandemic due primarily to family stress and separation from peers. States reporting an increase in demand had high coronavirus positivity and high unmet services need. The greatest impacts were reduced out-of-home services and increased use of telehealth. Barriers to telehealth services included limited access to internet and technology, family preference for face-to-face services, lack of privacy, difficulty using with young children and youth in need of substance use treatment, finding a Health Insurance Portability and Accountability Act (HIPAA)-compliant platform, training providers and clients, and reimbursement challenges. Policy changes to enable reimbursement, internet access, training, and provider licensing resulted in substantially fewer appointment cancellations or no-shows, greater family engagement, reduction in travel time, increased access for people living in remote locations, and increased provider communication and collaboration. States with high rates of coronavirus positivity and high rates of unmet need were most likely to continue use of telehealth post-pandemic. Despite these challenges, states reported successful implementation of policies designed to facilitate virtual services delivery with likely long-term changes in practice. Conclusions: Policy implementation during the pandemic provided important lessons for planning and preparedness for future public health emergencies. Successful policy implementation requires ongoing collaboration among policy makers and with providers.