REPORT/RECOMMENDATION TO THE BOARD OF SUPERVISORS
OF SAN BERNARDINO COUNTY
AND RECORD OF ACTION
September 22, 2026
FROM
JOSHUA DUGAS, Acting Director, Department of Behavioral Health
SUBJECT
Title
Amendment to Standard Agreement Template for Substance Use Disorder and Recovery Services Withdrawal Management and Residential Treatment Services
End
RECOMMENDATION(S)
Recommendation
1. Approve Amendment No. 2 to the standard agreement template for Substance Use Disorder and Recovery Services Withdrawal Management and Residential Treatment Services, updating standard contract language, increasing the aggregate amount by $35,217,804, from $160,395,592 to $195,613,396, with no change to the total contract period of January 1, 2024 through December 31, 2028.
2. Approve Amendment No. 2 to Agreement No. 23-1364 with Tarzana Treatment Centers, Inc., for the provision of Substance Use Disorder and Recovery Services Withdrawal Management and Residential Treatment Services, updating standard contract language, increasing the same aggregate amount of $35,217,804, from $160,395,592 to $195,613,396, with no change to the total contract period of January 1, 2024 through December 31, 2028.
3. Authorize the Assistant Executive Officer or the Director of the Department of Behavioral Health to execute the amendment to the standard agreement template with the individual Substance Use Disorder and Recovery Services Withdrawal Management and Residential Treatment Services providers, on behalf of the County, subject to review by County Counsel.
(Presenter: Joshua Dugas, Acting Director, 252-5142)
Body
COUNTY AND CHIEF EXECUTIVE OFFICER GOALS & OBJECTIVES
Promote and Fulfill the Countywide Vision.
Foster Sustainable Development Through Strategic Partnerships.
Provide for the Safety, Health and Social Service Needs of County Residents.
FINANCIAL IMPACT
Approval of this item will not result in the use of additional Discretionary General Funding (Net County Cost). The recommended aggregate increase, in an amount not to exceed $35,217,804 for Substance Use Disorder and Recovery Services (SUDRS) Withdrawal Management (WM) and Residential Treatment (RT) Services, is funded by Federal Financial Participation Drug Medi-Cal Organized Delivery System; Opioid Settlement funding; Substance Use Prevention, Treatment, and Recovery Services Block Grant, and existing ongoing 2011 Realignment funds. Additionally, it is supported by a Memorandum of Understanding (MOU) between the Department of Behavioral Health (DBH) and the Transitional Assistance Department (TAD) that is funded with California Work Opportunity and Responsibility to Kids Life Skills program funds as well as an MOU with the Department of Children and Family Services (CFS) funded with existing ongoing 2011 Realignment funds. Adequate appropriation and revenue have been included in DBH’s, TAD’s, and CFS’ 2026-27 budget and will be included in future recommended budgets.
BACKGROUND INFORMATION
DBH is responsible for providing mental health and substance use disorder (SUD) services to San Bernardino County (County) residents experiencing severe mental illness and/or SUD. County-operated programs and contracted providers deliver treatment and supportive services within DBH’s SUD continuum of care. SUDRS WM and RT offer trained staff and 24-hour clinical support for adults, adolescents, and perinatal patients. Beginning in 2027, DBH will expand these services to the Highland Creek Housing and Wellness Campus located in Highland, the Behavioral Health Comprehensive Treatment Campus located in Victorville, and additional county regions to meet growing service demand.
On December 19, 2023 (Item No. 31), as a result of a formal procurement, the Board of Supervisors (Board) approved a standard agreement template in an aggregate amount not to exceed $89,730,320 for the period of January 1, 2024 through December 31, 2028. Additionally, the Board approved Agreement No. 23-1364 (Agreement) with Tarzana Treatment Centers, Inc. (Tarzana), in the same aggregate amount not to exceed $89,730,320, for the period of January 1, 2024 through December 31, 2028.
The individual agreement with Tarzana differs in its fee-for-service (FFS) payment structure due to the specialized population of adolescents and the limited number of clients Tarzana serves. For Tarzana, the number of adolescent clients treated at the residential level is less than the number of adult clients, as their facility lies outside of the county, which often deters youth, parents, and governmental organizations responsible for youth placements. Therefore, the adolescent population receiving treatment is considered limited. Tarzana was the only adolescent treatment provider for SUDRS WM and RT. With this expansion, Inland Valley Drug and Alcohol Recovery Services dba Inland Valley Recovery Services (IVRS) will be added as an additional provider for adolescent clients, allowing DBH to serve more youth within the county.
DBH utilizes a standard agreement template for SUDRS WM and RT services to maintain a pool of qualified service providers. Recommendation No. 1 will increase the aggregate amount to be expended pursuant to this template. The following five agencies currently provide SUDRS WM and RT services via this template:
• G and C Swan, Inc.
• IVRS
• Phoenix House Orange County, Inc.
• Social Science Services, Inc. dba Cedar House Life Change Center
• VARP, Inc.
On March 11, 2025 (Item No. 13), the Board approved Amendment No. 1 to the standard agreement template for the provision of SUDRS WM and RT, increasing the aggregate amount by $70,665,272, from $89,730,320 to $160,395,592, with no change to the total contract period of January 1, 2024 through December 31, 2028. Additionally, the Board approved Amendment No. 1 to the Agreement with Tarzana, increasing the aggregate amount by $70,665,272, from $89,730,320 to $160,395,592, with no change to the total contract period of January 1, 2024 through December 31, 2028.
The California Department of Health Care Services (DHCS) is transforming the Medi-Cal program through the multi-year California Advancing and Innovating Medi-Cal (CalAIM) initiative, which is designed to create a more coordinated, person-centered, and equitable health system. As part of the CalAIM initiatives, Behavioral Health Payment Reform (BHPR) transitioned Medi-Cal reimbursement for eligible providers from a cost-based reimbursement model administered by DHCS to a rate-based FFS reimbursement model administered by DBH. This transition streamlines administrative processes, improves payment timelines and transparency, and establishes the foundation for future value-based payment models that emphasize quality and health outcomes.
The requested $35,217,804 increase to the aggregate amount will expand capacity within the SUDRS WM and RT programs and streamline administrative processes by consolidating all aggregate increases into a single action. Approval of this item will also update standard contract language to incorporate Behavioral Health Services Act requirements, reflect the legal name change of Veteran’s Alcohol Rehabilitation Program, Inc. to VARP, Inc., incorporate the Levine Act - Campaign Contribution Disclosure (formerly Senate Bill 1439) and replace the provisional payment language to align with the rate-based FFS reimbursement methodology implemented under the CalAIM BHPR initiative.
During 2024-25, the SUDRS WM and RT program served:
• Approximately 1,546 unduplicated clients annually;
• At an estimated cost of $10,273 per client across all service providers.
DBH projects serving an additional 2,763 unduplicated clients for the remainder of the contract term:
• Approximately 1,842 unduplicated clients annually;
• At an estimated cost of $12,746 per client across all service providers.
Performance measures for SUDRS contracts focus on tracking service quality, timeliness, accessibility, and outcomes to ensure providers meet established standards. Contractors are required to submit regular reporting such as monthly service logs, outcome data, fiscal reports, and compliance documentation, which allows the department to monitor progress and identify trends or concerns. Accountability mechanisms, including performance audits, contract monitoring meetings, site visits, and corrective action plans, help ensure that services are delivered as intended and align with program goals. Together, these structures promote transparency, support continuous improvement, and ensure that community members receive high quality, effective behavioral health services.
PROCUREMENT
N/A
REVIEW BY OTHERS
This item has been reviewed by Behavioral Health (Vanessa Esparza, Administrative Supervisor I, 388-0858) on August 27, 2026; County Counsel (Dawn Martin, Deputy County Counsel, 387-5455) on August 25, 2026; Children and Family Services (Adam J. Arentz, Administrative Supervisor II, 658-1108) on September 2, 2026; Transitional Assistance Department (Colin Bailey, Regional Manager, 386-9716) on September 2, 2026; and County Finance and Administration (Iliana Rodriguez, Administrative Analyst, 386-8392) on September 3, 2026.