To: County of Sonoma Board of Supervisors
Department or Agency Name(s): Department of Health Services
Staff Name and Phone Number: Tina Rivera, 707-565-4774
Vote Requirement: 4/5th
Supervisorial District(s): Countywide
Title:
Title
Behavioral Health Services Agreements - Additional Delegated Authority for Fiscal Year 2023-2024
End
Recommended Action:
Recommended action
A) Authorize a total increase not to exceed an amount of $3,943,414 to the Director of Health Services’, or designee’s, Fiscal Year 2023-2024 delegated authority to execute agreements and amendments with providers of Behavioral Health services that are new contracts and reconciliation to prior year contracts.
B) Authorize a total increase not to exceed an amount of $249,168 to the Director of Health Services’, or designee’s, Fiscal Year 2023-2024 delegated authority to execute agreements and amendments for the setup and operation of the state Department of Health Care Services’ Interoperability program.
C) Authorize a total increase not to exceed an amount of $9,762,807 to the Director of Health Services’, or designee’s, Fiscal Year 2023-2024 delegated authority to execute amendments for the augmentation of Behavioral Health contracts meeting higher service demand.
D) Adopt a Budget Resolution adjusting the fiscal year 2023-2024 budget by $13,322,561 to program available state funds balances, new Medi-Cal reimbursement, new state grants, local Measure O, and private donation to finance the Recommended Actions above. (4/5th vote required)
end
Executive Summary:
The Behavioral Health division of the Sonoma County Department of Health Services (hereinafter, “DHS” or “the Department”) contracts with a broad range of providers of mental health (MH) services and substance use disorder services (SUDS). To avail community resources in an expeditious way, department staff has/is requesting delegated authority in for multiple programs and providers ahead of finalizing agreements, but with maximum not to exceed amounts. Is important to note, that all non-county agreement parties included in this action are state or non-profits which are annually reviewed through the Auditor-Controller-Treasurer-Tax Collector Single Audit.
Due to the varied use level nature of these contractual services, additional authority and budgetary capacity to obligate the county are needed as follows:
Recommended Action A for $3,943,414, represents three (3) contractual situations:
• New contracts in the FY 2023-2024 needed because of ongoing contract negotiations which can be funded with available fund balances.
• Prior year contracts that have been reconciled with the CA Department of Heath Care Services (DHCS) that require additional contractual authority to settle final audit payouts back to the state or local contractors.
• Contract augmentation for eligible clients in the Medi-Cal program Beneficiary Request for Service (BRS).
Recommended Action B for $249,168, represents one (1) contractual situation:
• $249,168 for the setup and operation of the state Department of Health Care Services’ (DHCS) Interoperability program, which ensures that the state-developed Electronic Health Record (EHR) system called SmartCare will be able to communicate securely between DHS and CalMHSA in Sacramento. The remainder of the $407,312 grant award will be expended in the two subsequent years.
Recommended Action C for $9,762,807, represents twenty-six (26) existing provider contracts that require amendments to augment their maximum payment capacity. Most of these contracts are for mandated services provided by Medi-Cal providers and the remainder are for contractors that serve a population mandated by the state to receive treatment (i.e., Conservatees).
Discussion:
DHS contracts with a broad range of licensed providers to provide timely access to high-quality mental health and substance use disorder services. Many of the Department’s behavioral health services contracts are managed within a medical network of care as mandated by federal and state regulations. Consistent with state requirements for mental health plans, the Department must maintain an adequate network of service providers based on client need, geographic coverage, culturally-based needs and language capabilities. Mental Health Services Act (MHSA) programs and service needs are vetted annually through a community planning and input process that includes posting of the Mental Health Services Act plan for comment and a public hearing.
Exhibit A provides a list of behavioral health service providers for which the Department is requesting additional delegated authority (or a transfer of existing delegated authority from other categories). Individual contract amounts may be different as final agreements are negotiated which are expected to be completed by year-end but the total amount for each delegated authority category will not exceed its total without further Board action.
Recommended Action A - Behavioral Health Services $3,943,414
As introduced in the Executive Summary above, this group of contracts and programs can be further divided into key categories: (1) new contracts to provide services for current programs, (2) reconciliation of prior year contracts, and (3) augmentation of funding for the Medi-Cal program Beneficiary Request for Service (BRS).
New Contracts - $1,958,908
Programs within Sonoma County like “Stepping-Up” that started operations after the beginning of the FY require budgetary appropriations not anticipated during budget development in FY 22-23. For example, Stepping-Up requires $100,000 in appropriations for expenditures that will be covered by the California Department of State Hospitals (DSH).
Another example of new contracts not anticipated is the agreement with the NewLife tribal clinic in Mendocino County for $500,000 where Native Americans in the furthest reaches of Sonoma County (e.g., Cloverdale) are referred to NewLife in Ukiah instead of Santa Rosa due to proximity of care. These costs will be fully reimbursed by Federal funds via DHCS.
Reconciliation of Prior-Year Contracts- $1,696,993
Appropriations are needed for contractors like Buckelew Programs and the Seneca Family of Agencies where prior-year contracts have been reconciled and cost-settlement is needed to close out those contracts. Prior to CalAIM (California Advancing & Innovating Medi-Cal) Payment Reform, cost-settlement was the accepted practice for contracting with service providers, especially when reconciliation with state reimbursements did not occur until after the FY had closed. For Buckelew Programs, DHS needs to close out FY 2021-2022 for $478,922, and Mental Health Services Act (MHSA) funding is available to cover this eligible expense For the Seneca Family of Agencies, $118,519 is needed to close out a FY 21-22 contract, and 1991 Mental Health Realignment is available to cover this settlement. Also, reconciliation with the state agency DHCS itself requires $1,099,552 from DHS to close out FY 2014-2015, which will be paid for out of the Department’s audit reserves.
Beneficiary Request for Service (BRS) - $287,513
Under current regulations, Medi-Cal beneficiaries who receive specialty mental health services from county mental health plans have the right to make certain requests for services. There are two types of Beneficiary Requests for Service:
• Continuity of Care (COC) - The California Department of Health Care Services states that “beneficiaries with pre-existing provider relationships who make a continuity of care request to the county mental health plan must be given the option to continue treatment for up to 12 months with an out-of-network Medi-Cal provider.”
• Extended Network Provider (ENP) - If the Department of Health Services is unable to provide necessary services, they will find an Extended Network Provider (ENP) who can deliver the services to the beneficiary.
The proposal to increase the BRS allocation in FY 23-24 is for $287,513: $181,413 specifically for youth BRS and $106,100 for adult BRS.
Recommended Action B - Multi-Year Agreement for Electronic Health Record System
The setup and operation of DHCS’ Interoperability program, which ensures that the state-developed Electronic Health Record (EHR) system called SmartCare will be able to communicate securely between DHS and Sacramento, will require $249,168 in additional appropriation for FY 23/24. There are 2 phases to this project: (1) the setup of secure communications with a one-time charge of $150,000 in year 1 implemented by CalMHSA [California Mental Health Services Authority, a joint-powers authority (JPA) among CA counties] and an operational component of approximately $63,000 annually thereafter for 2 more years; and (2) the secure archival of legacy patient data from EHR systems use by DHS prior to the implementation of SmartCare with a one-time charge of $24,900 and an operational component of $11,268 annually thereafter for 2 more years. The remainder of the $407,312 grant award, or $158,144, will be expended in the two subsequent years. These expenses will be covered by the DHCS program called Behavioral Health Quality Improvement Program (BHQIP).
Recommended Action C
This group of contractors includes some key categories that require augmentation to the Maximum Payment portion of the contract due to the mandated nature of the services.
1. Medi-Cal Services
2. In-Patient Hospitalization
3. Medical Staffing Agency
Medi-Cal Services
Community providers of Medi-Cal services provide a wide gamut of mandated services, including Mental Health Plan (MHP) services such as crisis intervention, intensive care coordination, outpatient residential treated, and inpatient services, as well as Substance Use Disorder Services (SUDS). SUDS, for example, includes residential detoxification services and methadone dosage management such as provided by Drug Abuse Alternatives Center (DAAC). The opioid crisis in Sonoma County is reflected in the very strong demand for DAAC’s services as indicated by utilization rates that increased 10% year-over-year from FY 21/22 to FY 22/23 and projects to be at least that rate from FY 22/23 to FY 23/24. DAAC’s projected need for the last quarter of the current FY 23/24 is for an additional $1.4 million.
Inpatient Hospitalization
Mental Health Plan (MHP) patients who require the highest level of acuity treatment will require inpatient hospitalization. Unfortunately, this level of treatment is also one of the most expensive. The lone Santa Rosa Behavioral Health Hospital (formerly known as Aurora Healthcare) requires an infusion of $2,000,000 based on expenditure trends. The escalating expenditure trends are based on increasing referral trends of high-acuity patients to this facility. 2011 Realignment funds are dedicated to SUDS programs in DHS and will cover this augmentation.
Medical Staffing Agencies
Medical Staffing Agency contracts maintain a pool of psychiatrists and other psychiatric professionals to provide services in the event the County is unable to recruit and retain staff, or to provide for the specialized needs of Mental Health Plan patients. The Department contracts with staffing agencies, locum tenens, or other providers as needed, and in FY 2023-2024, DHS will need to augment this contract by $2,138,523.
The sustainability of utilizing psychiatrists and other clinical staff from medical staffing agencies versus hiring county employees has been discussed at length between DHS management and County Human Resources. DHS is working with County-HR to analyze salary levels for County psychiatrists in the Bay Area in hopes of bringing parity to support County recruitment efforts of the aforesaid clinical staff. In the meantime, DHS will continue to use medical staffing agencies to provide psychiatric services to fill the operational needs resulting from vacant county staff psychiatrists.
Strategic Plan:
N/A
Prior Board Actions:
The Board annually authorizes the Director of Health Services to execute agreements for mental health and substance use disorder services and support services agreements for behavioral health services.
On November 28, 2023, the Board authorized the Director of Health Services, or designee, to execute a funding agreement with HORNE to receive $728,439 in revenue to support the Community Care Expansion Program in Sonoma County through January 30, 2027.
On July 18, 2023, the Board adopted a resolution to authorize the Director of Health Services to execute a standard agreement with California Interagency Council on Homelessness and to receive $4,567,130 in revenue to support the Encampment Resolution Funding.
On June 12, 2023, the Board A) Authorized the Director of Health Services, or designee, to execute agreements and amendments to Mental Health, Substance Use Disorder, and Behavioral Health Support Services for Fiscal Year 2023-2024 of $70,324,247 that will end June 30, 2024 and $44,811,628 for contracts that will end no later than June 30, 2029; and B) Authorized the Director of Health Services, or designee, to execute an agreement with Aurora Behavioral Healthcare for reimbursement of associated administrative costs incurred by the County for the term of July 1, 2023, through June 30, 2024, resulting in revenue to the Department of Health Services of $250,000.
On December 13, 2022, the Board A) Authorized the Director of Health Services, or designee, to execute an extension of the current agreement for Patient Rights Advocate services with The SmithWaters Group through June 30, 2023; B) Authorized the Director of Health Services, or designee, to execute an extension of current agreements with five providers of Temporary Clinical Staffing services, including psychiatry and nursing, through June 30, 2023 and an increase in delegated authority of $2,586,799 for Fiscal Year 2022-23; C) Authorized an increase of $288,000 to the Director of Health Services’, or designee’s, Fiscal Year 2022-2023 delegated authority to execute agreements and amendments with providers of Behavioral Health services that are the result from Beneficiary Requests for Services for Adults; D) Authorized a total increase of $216,000 to the Director of Health Services’, or designee’s, delegated authority to execute agreements and amendments for Administrative Hearing Officer services with California Hearing Officers, with a term ending no later than June 30, 2025; E) Authorized an increase of $500,000 to the Director of Health Services’, or designee’s, Fiscal Year 2022-2023 delegated authority to execute agreements and amendments with California Psychiatric Transitions to provide rehabilitative care for adults with serious mental illness; F) Authorized an increase of $500,000 to the Director of Health Services’, or designee’s, Fiscal Year 2022-2023 delegated authority to execute agreements and amendments with service providers of outpatient telehealth services to supplement current providers in their ability to schedule and provide treatment within the mandated timeframes for timeliness and availability requirements; and G) Adopted a budget resolution adjusting the fiscal year 2022-2023 revised budget to increase expenditures by $2,208,570 financed with use of $2,208,570 of 1991 Mental Health Realignment Fund Balance.
On June 13, 2022, the Board approved 1) An increase of $13,691,995 to the Director of Health Services’, or designee’s, Fiscal Year 2022-2023 delegated authority to extend or renew agreements and amendments with providers of Behavioral Health services for terms ending no later than June 30, 2025; 2) The Director of Health Services, or designee, to execute new agreements and amendments with providers of Behavioral Health services, competitively procured during Fiscal Year 2021-2022 and 2022-2023, in an amount not to exceed $18,550,173, for terms ending no later than June 30, 2027, including $4,093,103 in Fiscal Year 2022-2023; 3) An increase by $194,349 to the Director of Health Services’, or designee’s, delegated authority to execute an agreement with Sonoma County Office of Education for mental health services for children and youth, resulting in a new not-to-exceed amount of $3,248,270; and 4) The Director of Health Services, or designee, to execute an agreement with Aurora Behavioral Healthcare for reimbursement of associated administrative costs incurred by the County for the term July 1, 2022, through June 30, 2023, resulting in revenue of $250,000.
Fiscal Summary
|
Expenditures |
FY 23-24 Adopted |
FY 24-25 Projected |
FY 25-26 Projected |
|
Budgeted Expenses |
$632,822 |
$79,072 |
$79,072 |
|
Additional Appropriation Requested |
$13,322,561 |
|
|
|
Total Expenditures |
$13,955,383 |
$79,072 |
$79,072 |
|
Funding Sources |
|
|
|
|
General Fund/WA GF |
|
|
|
|
State/Federal |
$4,364,133 |
$79,072 |
$79,072 |
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Fees/Other |
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Use of Fund Balance |
$9,591,251 |
|
|
|
Contingencies |
|
|
|
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Total Sources |
$13,955,383 |
$79,072 |
$79,072 |
Narrative Explanation of Fiscal Impacts:
The Fiscal Year 2023-2024 budget already included appropriations of $632,822 that can be redirected from unspent program funds and applied towards BH contracts. The remaining request for new appropriations of $13,322,561 all have dedicated Federal, state, or local Measure-O funds to cover expenses, which total to an adjusted budget of $13,955,384. Future Fiscal Year appropriations will be included through the annual budgetary process.
Funding sources for the $13,955,384 can be allocated according to the following breakdown:
• $3,404,135 1991 Mental Health Realignment ($3,005,859 use of Fund Balance, leaving an estimated fund balance as of June 30, 2024 of $12,500,000)
• $4,389,826 2011 Behavioral Health Realignment ($3,619,985 use of Fund Balance, leaving an estimated unobligated fund balance as of June 30, 2024 of $11,500,000)
• $1,826,701 Medi-Cal Federal Financial Participation (FFP) reimbursement
• $1,376,007 Mental Health Services Act (MHSA)Community Support Services ($867,855 use of Fund Balance, leaving an estimated unobligated fund balance as of June 30, 2024 of $19,200,000)
• $1,099,552 in Audit Reserves (Behavioral Health Stabilization Funds leaving an estimated Fund Balance as of June 30, 2024 of $21,900,000)
• $1,000,000 Measure-O tax receipts (Emergency Psychiatric/Crisis Services Fund Balance, leaving an estimated unobligated Fund Balance as of June 30, 2024 of $660,000)
• $249,168 Behavioral Health Quality Improvement Program (BHQIP)
• $600,000 in Other funding, $500K of which is Federal pass-through via the NewLife tribal clinic.
• $10,000 in private estate donation to the Behavioral Health division.
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Staffing Impacts: |
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Position Title (Payroll Classification) |
Monthly Salary Range (A-I Step) |
Additions (Number) |
Deletions (Number) |
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Narrative Explanation of Staffing Impacts (If Required):
N/A
Attachments:
Attachment 1 - Additional Delegated Authority by Provider
Attachment 2 - Budget Resolution
Related Items “On File” with the Clerk of the Board:
None