REPORT/RECOMMENDATION TO THE BOARD OF SUPERVISORS
OF SAN BERNARDINO COUNTY
AND RECORD OF ACTION
December 16, 2025
FROM
GEORGINA YOSHIOKA, Director, Department of Behavioral Health
SUBJECT
Title
Standardized Contract Template Amendments for Contracts Providing Specialty Mental Health Services and/or Substance Use Disorder and Recovery Services
End
RECOMMENDATION(S)
Recommendation
1. Approve the following standardized contract templates to amend the provisional payment language depending on the provisional payment structure, with providers of Specialty Mental Health Services, as a result of the Department of Health Care Services California Advancing and Innovating Medi-Cal Behavioral Health Payment Reform, as specified below, effective January 1, 2026:
a. Combined Cost Reimbursement and Fee-for-Service provisional payment
b. Fee- for-Service provisional payment
2. Approve the following standardized contract templates to amend the provisional payment language depending on the provisional payment structure, with providers of Substance Use Disorder and Recovery Services, as a result of the Department of Health Care Services California Advancing and Innovating Medi-Cal Behavioral Payment Reform, as specified below, effective January 1, 2026:
a. Combined Cost Reimbursement and Fee-for-Service provisional payment
b. Fee-For-Service provisional payment
3. Authorize the Assistant Executive Officer, the Deputy Executive Officer, or the Director of the Department of Behavioral Health to execute the standardized contract templates with the providers of Specialty Mental Health services and/or Substance Use Disorder and Recovery services, dependent on the provisional payment structure as cost reimbursement or fee-for-service, as referenced in Recommendation Nos. 1 and 2, and make any non-substantive changes to the contract templates on behalf of the County, subject to review by County Counsel.
4. Direct the Director of the Department of Behavioral Health to transmit all non-substantive amendments in relation to the contract amendments that will be completed utilizing the contract templates outlined in Recommendation Nos. 1 and 2 to the Clerk of the Board of Supervisors within 30 days of execution.
(Presenter: Marina Espinosa, Assistant Director, 252-5142)
Body
COUNTY AND CHIEF EXECUTIVE OFFICER GOALS & OBJECTIVES
Operate in a Fiscally-Responsible and Business-Like Manner.
Provide for the Safety, Health and Social Service Needs of County Residents.
FINANCIAL IMPACT
This item does not impact Discretionary General Funding (Net County Cost) as the standardized contract template amendments do not impact subsequent contract amounts with the providers of Specialty Mental Health Services and/or Substance Use Disorder and Recovery Services.
BACKGROUND INFORMATION
The California Department of Health Care Services (DHCS) is undergoing a transformation of its Medi-Cal program through a multi-year initiative called California Advancing and Innovating Medi-Cal (CalAIM). This transformation is designed to create a more coordinated, person-centered, and equitable health system for all Californians. Medi-Cal, California’s Medicaid program, provides health coverage to over 13 million low-income residents. Historically, Medi-Cal has operated under a fragmented system with varying levels of care and access depending on geography and population. Recognizing the need for modernization, DHCS launched CalAIM in 2022 as a comprehensive reform strategy to:
• Integrate physical, behavioral, and social health services
• Address social drivers of health (e.g., housing, food security)
• Improve health equity and reduce disparities
• Simplify and standardize care delivery across the state
As part of this broad transformation, DHCS has undertaken several CalAIM initiatives to drive quality of care improvements, streamline and reduce complexity, and build upon equity-focused, data-driven, and whole-person care. As part of the CalAIM initiatives, Behavioral Health Payment Reform has transitioned Medi-Cal reimbursement from DHCS to DBH, shifting from a cost-based reimbursement to a rate-based Fee-For-Service (FFS) model. Counties now receive standardized FFS payments instead of cost settlements. This shift simplifies administrative processes and lays the groundwork for value-based payment models, which reduce payment delays, increase transparency, and incentivize health outcomes over service volume.
This initiative impacts the entire behavioral health system of care, including contracted service providers. To align the contracts and transition to the new payment methodology, the current contract language needs to be amended to reflect the change to an FFS model.
Service costs not billable to Medi-Cal will continue to be paid under the cost reimbursement model; therefore, the combined cost reimbursement and FFS payment reimbursement structure to those service providers is warranted. Providers for the following program services will transition fully to the FFS model: Specialty Mental Health Services, Substance Use Disorder and Recovery Services, Full Services Partnerships, Therapeutic Behavioral Services, and Children’s Residential Intensive Services. To establish FFS rates for our contracted providers, DBH contracted with a consultant to work with both DBH staff and contracted providers to establish rates for the provision of Medi-Cal reimbursable services and transition payment processes to an FFS model.
As this initiative impacts dozens of providers and hundreds of contracts, the most efficient process to update the contract language is to establish contract template amendments that can be signed on a flow basis, effective January 1, 2026.
PROCUREMENT
Not applicable.
REVIEW BY OTHERS
This item has been reviewed by Behavioral Health (Diana Barajas, Contract Supervisor, 388-0862) on December 1, 2025; County Counsel (Dawn Martin, Deputy County Counsel, 387-5455) on December 1, 2025; and County Finance and Administration (Paul Garcia, Administrative Analyst, 386-8392) on December 2, 2025.