Title
Health and Human Services Agency (HHSA) recommending the Board:
1) Authorize the Chair to execute the Drug Medi-Cal Organized Delivery System (DMC-ODS) Intergovernmental Agreement 25-50096 (Fenix 9726), and the accompanying Contractor Certification Clauses Form (CCC 04/2017), with Department of Health Care Services, a reimbursement-based revenue agreement with a “zero-dollar” maximum obligation, to allow the County to not be limited to a specified reimbursement amount for DMC-ODS services, for the retroactive term effective July 1, 2025, through December 31, 2026;
2) Authorize the HHSA Director, or Chief Assistant Director to execute amendments to Agreement 9726, contingent upon approval by County Counsel and Risk Management, which do not increase Net County Cost; and
3) Authorize the HHSA Director, Chief Assistant Director, or Chief Financial Officer (as applicable) to execute programmatic, administrative and financial documents relating to the DMC-ODS Agreement 9726.
FUNDING: The DMC-ODS is funded through federal Medi-Cal, with match funding from State General Fund and 2011 Behavioral Health Realignment.
Body
DISCUSSION / BACKGROUND:
The mission of HHSA’s Behavioral Health Substance Use Disorder (SUD) Program is to provide an array of evidence-based services designed to prevent and reduce alcoholism and drug addiction through the provision of education, prevention, treatment, and counseling services. Such services are offered directly through SUD Program staff and through contracts with community agencies. Funding for these valuable services has varied over the years; however, since at least 1990, the County has received state and federal funding to provide SUD treatment services and prevention programs through agreements with the DHCS, including Drug Medi-Cal (DMC) and federal Substance Use Block Grants (SUBG).
In August 2015, DHCS announced approval of California’s DMC-ODS Waiver Program, enacted to provide a continuum of care for SUD treatment services. The DMC-ODS Program enables more local control and accountability, provides greater administrative oversight, creates utilization controls to improve care and efficient use of resources, implements evidence-based practices in substance abuse treatment, and coordinates with other systems of care. DMC-ODS Waiver Program participating counties administer or arrange for SUD treatment for DMC beneficiaries. On May 23, 2017, the Board authorized the County to “opt in” to the DMC-ODS Waiver Program (Legistar file 17-0525).
On September 21, 2021, the Board approved the Chair to execute DMC-ODS revenue-based Intergovernmental Agreement 21-10027 (Fenix 5929) in the amount of $38,574,276, for a retroactive term beginning July 1, 2021, through June 30, 2024 (Legistar file 21-1360). The DMC-ODS revenue agreement’s term was later extended to June 30, 2027, and the maximum obligation was increased to $77,148,552, via the agreement’s Third Amendment. On April 1, 2025, HHSA was notified by DHCS of the early cancelation of Agreement 21-1002, with the termination date effective June 30, 2025, and DHCS informed HHSA that a renewal DMC-ODS Intergovernmental Agreement, with the effective start date of July 1, 2025, would soon be issued. DHCS later informed DMC-ODS participating counties of the states’ plan to remove the maximum obligation in the renewal agreements notating the change in agreement structure from a prior maximum obligation funding-in contract model to a reimbursement-based service model titled a “zero-dollar” maximum obligation agreement. This agreement change is to enable DMC-ODS counties to not need multiple amendments to accept increased reimbursement as the state has elected to not set a cap on maximum obligation.
To ensure no interruption in reimbursement from DHCS for DMC-ODS services, HHSA is recommending Board approval of this agenda item to ensure the DMC-ODS Intergovernmental Agreement 9726 is executed retroactively effective July 1, 2025. Approval of this agreement will allow HHSA to continue providing vital DMC-ODS services to Medi-Cal beneficiaries while ensuring continued reimbursement for services through federal and state funding sources.
ALTERNATIVES:
In the event the Board declines to approve this agenda item, HHSA would not meet the DHCS requested timeline to execute the agreement timely. Further, HHSA’s Behavioral Health Division would not receive Medi-Cal and other state/federal funding reimbursement from DHCS for DMC-ODS covered services.
PRIOR BOARD ACTION:
1) 05/23/17, File ID 17-0525, HHSA Federal 1115 Waiver for DMC ODS
2) 09/21/21, File ID 21-1360, HHSA - Agmt 21-10027 DHCS, F-5929
3) 11/15/22, File ID 22-1818, HHSA DHCS MHP, Agmt 6967
OTHER DEPARTMENT / AGENCY INVOLVEMENT:
County Counsel
CAO RECOMMENDATION:
Approve as recommended.
FINANCIAL IMPACT:
There is no Net County Cost associated with this agenda item. Services provided under the DMC-ODS Intergovernmental Agreement will be funded by Federal Financial Participation (FFP) funds that will be matched with State General Fund (SGF), Mental/Behavioral Health Services Act funding, 1991 and 2011 Realignment funds, and private insurance with a small portion of client fees. Sufficient appropriations were included in the Fiscal Year 2025-26 Budget and will be included in future budgets for the years applicable to the agreements.
CLERK OF THE BOARD FOLLOW UP ACTIONS
N/A
STRATEGIC PLAN COMPONENT:
N/A
CONTACT
Olivia Byron-Cooper, MPH, Director, Health and Human Services Agency