Recent experimental reports of heme carbene C-H insertions show promising results for sustainable chemistry due to good yield and selectivity, low cost of iron, and low/no toxicity of hemes. But mechanistic details are mostly unknown. Despite structural similarity and isoelectronic nature between heme carbene and Fe^IV=O intermediate, our quantum chemical studies with detailed geometric and electronic information for the first time reveals an Fe^II-based, concerted, hydride transfer mechanism, different from the Fe^IV-based stepwise hydrogen atom transfer mechanism for C-H functionalization by native heme enzymes. A trend of broad range experimental C-H insertion yields (0-88%) of five different C-H bonds including mostly non-functionalized ones was well reproduced. Results suggest that the substrate selectivity originate from the hydride formation capability. The predicted kinetic isotope effects were also in excellent agreement with experiment. Useful geometry, charge, and energy parameters well correlated with barriers were reported. Results provide the first theoretical evidence that carbene formation is the overall rate-limiting step and suggest a key role of the formation of strong electrophilic heme carbene in developing heme-based C-H insertion catalysts and biocatalysts.