The County of Santa Clara
California

Agreement/Amendment
95574

Consider recommendations relating to rate and service parameter adjustments of behavioral health service contracts.

Information

Department:Mental Health Services (Santa Clara Valley Health and Hospital System)Sponsors:
Category:Delegation of Authority

Attachments

  1. Printout
  2. Attachment 1 - Frequently Asked Questions (FAQs) and Memos
  3. Attachment 2 - Implementing the Managed Care Rule- Network Adequacy Standards
  4. Attachment 3 - California County Mental Health Financing 101
  5. Attachment 4 - FY2020 SD-MHSA and SUTS Renewal Process Presentation
  6. Attachment 5 - OIG Report Summary
  7. Executed Agreement with Caminar for Mental Health
  8. Executed Agreement with Catholic Charities
  9. Executed Agreement with Catholic Charities FY 2020
  10. Executed Agreement with Children's Health Council
  11. Executed Agreement with Community Solutions
  12. Executed Agreement with Community Solutions FY2020
  13. Executed Agreement with Community Solutions 29
  14. Executed Eighth Amendment to Agreement with Cielo House
  15. Executed First Amendment to Agreement with Catholic Charities FY2020
  16. Executed Agreement with Pathway Society, Inc.
  17. Executed Agreement with Community Solutions
  18. Executed First Amendment to Agreement with Ujima Adult and Family Services, Inc.
  19. Executed First Amendment to Agreement with Children's Health Council
  20. Executed First Amendment to Agreement with Community Solutions (SHS)
  21. Executed Second Amendment to Agreement with Community Solutions
  22. Executed First Amendment to Agreement with Fred Finch Youth Center (Family and Children)
  23. Executed First Amendment to Agreement with Goodwill of Silicon Valley (AOA)
  24. Executed First Amendment to Agreement with Caminar for Mental Health
  25. Executed First Amendment to Agreement with HealthRIGHT 360 (Family and Children)
  26. Executed First Amendment to Agreement with Catholic Charities of Santa Clara County
  27. Executed First Amendment to Agreement with HealthRIGHT 360 (AOA)
  28. Executed First Amendment to Agreement with Gardner Family Health Network (Family and Children)
  29. Executed Second Amendment to Agreement with Catholic Charities of Santa Clara County
  30. Executed Second Amendment to Agreement with Gardner Family Health Network (AOA)
  31. Executed Second Amendment to Agreement with Gardner Family Health Network (Family and Children)
  32. Executed First Amendment to Agreement with The Health Trust (SHS)
  33. Executed First Amendment to Agreement with Peninsula Healthcare Connection
  34. Executed Agreement with Community Solutions
  35. Executed Agreement with Fred Finch Youth Center
  36. Executed Agreement with Gardner Family Health Network FY2020
  37. Executed Agreement with Gardner Family Health Network
  38. Executed Agreement with Goodwill of Silicon Valley
  39. Executed Agreement with HealthRight 360
  40. Executed Agreement with HealthRight 360 FY2020
  41. Executed Agreement with The Healh Trust
  42. Executed First Amendment to Agreement with Starlight Community Services, Inc.
  43. Executed Second Amendment to Agreement with People Assisting The Homeless
  44. Executed Second Amendment to Agreement with Asian Americans
  45. Executed First Amendment to Agreement with Asian Americans
  46. Executed First Amendment to Agreement with Bill Wilson Center
  47. Executed First Amendment to Agreement with Bill Wilson Center FY2020
  48. Executed First Amendment to Agreement with Caminar for Mental Health
  49. Executed Agreement with Adobe Services
  50. Executed Agreement with Peninsula Healthcare Connection
  51. Executed Agreement with Seneca Family of Agencies
  52. Executed Agreement with Alum Rock Counseling Center
  53. Executed Agreement with Asian Americans for Community Involvement
  54. Executed Agreement with Asian Americans for Community Involvement FY20
  55. Executed Agreement with Caminar
  56. Executed Agreement with Seneca FY2019-2020
  57. Executed Agreement with People Assisting The Homeless
  58. Executed Agreement with Rebekah Children's Services
  59. Executed Agreement with Rebekah Children's Services
  60. Executed Agreement with Starlight Community Services, Inc.
  61. Executed Agreement with Telecare Corporation
  62. First Amendment to Agreement with Rainbow Recovery Foundation
  63. First Amendment to Agreement with University Enterprises, Inc.
  64. Executed Agreement with Bill Wilson Center (Family and Children Services)
  65. Executed Agreement with Bill Wilson Center (Adult and Older Adult Services)
  66. Executed Agreement with Caminar for Mental Health
  67. Executed Agreement with Rainbow Recovery Foundation, Inc. FY2020
  68. FY20 SD-MHSA Starlight Community Services-F&C-Amend 1_Executed
  69. FY20 Ujima SD-MHSA Amend 1_Executed
  70. Agreement-Ujima FC-FY20
  71. Agreement-Starlight Community Services-SD-MHSA-FY20
  72. Agreement-Ujima AOA-FY20
  73. Agreement-Uplift Family Services-SD MHSA-FY20
  74. Agreement-Victor FC-FY20

Multiple Recommendations

Possible action:
a. Receive report from the Behavioral Health Services Department relating to the implementation of Medi-Cal Managed Care Final Rule and Drug Medi-Cal Organized Delivery System requirements.
b. Approve delegation of authority to the County Executive, or designee, to negotiate, execute, amend, or terminate agreements with behavioral health contract providers relating to rate adjustments and service parameter modifications in an amount not to exceed $285,000,000 and a contract term that starts no earlier than July 1, 2019 and ends no later than June 30, 2020, following approval by County Counsel as to form and legality, and approval by the Office of the County Executive; and following approval by the Office of Countywide Contracting Management of an exception to Board of Supervisors Policy 5.4.5.4, Length of Term of Contracts, for any amendment that extends an existing contract beyond a five year term. Delegation of authority shall expire on December 31, 2019.

Body

FISCAL IMPLICATIONS

The Behavioral Health Services Department (BHSD) is requesting a Fiscal Year (FY) 2020 Delegation of Authority (DOA) for $285,000,000 for its Short-Doyle (SD), Mental Health Services Act (MHSA) and Substance Use Treatment Services (SUTS) contracts. The total Maximum Financial Obligation (MFO) for these contracts totaled $284,593,704 in FY 2019, thus no budget changes are recommended at this time. BHSD Program staff will continue to monitor contract performance, and Finance staff will monitor the billed services against the fiscal appropriations and will request a budget modification if necessary.

The BHSD SD/MHSA Medi-Cal contracts include one or more of the following funding sources: California Department of Corrections and Rehabilitation; CalWORKs; City of San Jose; City of Palo Alto; City of Mountain View; Behavioral Health County General Fund; FIRST 5 of Santa Clara County; Measure A; Medi-Cal Federal Financial Participation; MHSA; Projects for Assistance in Transition from Homelessness (PATH) Grant; Santa Clara County Probation Department; Santa Clara County Social Services Agency; San Andreas Regional Center (SARC); State Realignment; AB 109 Public Safety, Behavioral Health, and Mental Health); Substance Abuse and Mental Health Services Administration (SAMHSA); and U.S. Department of Housing and Urban Development (HUD).

The BHSD SUTS contracts include one or more of the following funding sources: Medi-Cal Federal Financial Participation; Measure A; State Realignment; AB 109 Public Safety; Drug Court Partnership (DCP); Comprehensive Drug Court Implementation (CDCI); California Department of Corrections and Rehabilitation; Santa Clara County Probation Department; Santa Clara County Social Services Agency; SAMHSA; and Substance Abuse Prevention and Treatment Block Grant (SABG) (including, Prevention, Friday Night Live, Perinatal, Adolescent/Youth, and Discretionary).

BHSD is issuing new agreements, and not amendments, for services provided in FY 2020. This approach allows for contracts to be streamlined and incorporate merged SUTS and SD/MHSA boilerplate language requirements. BHSD worked closely with County Counsel and the Health System’s Ethics, Privacy and Compliance Office to ensure complete inclusion of the State and Federal regulations in the agreements.  This is the next step in fully integrating the BHSD and the services provided.

REASONS FOR RECOMMENDATION

Reason for request of Delegation of Authority (DOA)

Although delegations of authority are discouraged except under certain circumstances, this delegation of authority is necessary to allow the completion of adjusting and redistributing the appropriate funding and capacity across the behavioral health delivery system to abide by new Medi-Cal Managed Care Final Rule and Drug Medi-Cal Organized Delivery System (DMC-ODS) requirements. In FY 2018, the BHSD initiated comprehensive efforts to reform its overall behavioral health delivery system with contract providers to meet these new State and Federal requirements. A report and timeline detailing the analysis and activities conducted by the BHSD is provided under the Background section of this Legislative File.

It is important to note that all contracts executed under this DOA would be reviewed for compliance with County Standards by County Counsel and a Deputy County Executive, prior to use of the delegated authority to finalize the contracts. Any proposed contract that contains an exception to County Contracting Standards that is not noted in this delegation will continue to be sent either to the Board of Supervisors or the Office of Countywide Contract Management (OCCM) for approval or as the Board of Supervisors has designated.

The following master contracts would obtain Beyond Five Year extension approvals for the specific programs listed from the OCCM or the Procurement Department prior to execution under this DOA. Beyond 5 Year extensions are requested to allow sufficient time for the completion of ongoing Requests for Proposals (RFPs), resolution of any potential protests, and completion of contract negotiations. Upon completion of the solicitations, protest resolutions, and contract negotiations, the BHSD would amend the contracts to reflect the addition of the newly awarded programs and terminate programs with vendors who did not receive contract award.

·        Catholic Charities Family and Children (F&C) Agreement for Family Supportive Services.

·        Community Solutions F&C Agreement for Katie A. Intensive Services.

·        Gardner Family Health Networks F&C Agreement for Differential Response and Katie A. Intensive Services.

·        Momentum for Mental Healths Adult and Older Adult (AOA) Agreement for Intensive Services in Day Rehabilitation, Intensive Outpatient Bridge Team Services, and Intensive Services at Crossroads Supplemental Residential Care Facility.

·        Rebekah Childrens Services F&C Agreement for North County Wraparound Services with the Department of Family and Childrens Services (DFCS), North County Wrapround Services with the Juvenile Probation Department (JPD), Ranch Reentry Services, and Katie A. Intensive Services.

·        Seneca Family of Agencies F&C Agreement for Wraparound Services with DFCS, Wraparound Services with JPD, Intensive Wraparound Services, Ranch Reentry Services, and Adoptive Assistance Program Wraparound Services.

·        Starlight Community Services F&C Agreement for Wraparound Services with DFCS, Wrapround Services with JPD, Ranch Reentry Services, and the Morgan Hill Mental Health Program.

·        Uplift Family Services F&C Agreement for Family Focused Support Services, Wraparound Services with DFCS, Wraparound Services with JPD, Intensive Targeted Wraparound Services, Katie A. Intensive Services, Ranch Reentry Services, and Differential Response Services.

This DOA is necessary to ensure that the BHSD can continue the analysis of real-time client service and delivery data to develop FY 2020 contracts and adjust these contracts as necessary. The BHSD is analyzing each program across the entire system of care to identify service gaps and address unmet client needs. This DOA would allow BHSD to adjust contracts to meet its obligation to provide beneficiary services and to make adjustments necessary to ensure clients receive required services that comply with the new network adequacy and timely access standards. The DOA would also allow the BHSD to increase service capacity in those programs in which contract providers have been able to meet contract obligations and provide additional capacity to address service gaps. The goal of these comprehensive efforts is to ensure that all Santa Clara County clients have timely access to care and receive the appropriate levels of service under the County’s MHP and DMC-ODS regulations.

There are approximately 57 SD/MHSA contracts with a total of 238 programs that require analysis under the requested DOA. An additional three SUTS contracts are also included. Due to the volume of provider meetings, negotiations, and financial analysis that must occur to determine the areas of the behavioral health system that require adjustments to each contract provider’s specific service mix (e.g., number of annualized caseloads, number of active caseloads, service dosages, lengths of stay, number of new clients per year, etc.), taking these contracts to the Board of Supervisors could result in a delay of crucial services regulated under State and Federal requirements.

The BHSD would return to the Board of Supervisors on a quarterly basis, in October 2019 and January 2020, to submit a report on the contracts executed under this DOA.

The BHSD serves as the administrator for the County’s Mental Health Plan (MHP) and DMC-ODS Waiver and is obligated to provide or arrange behavioral health services for these beneficiaries. Ensuring timely access and the availability of appropriate levels and amounts of services is required by the State and Federal government. Approval of this DOA would ensure BHSD can continue the work that it began in FY 2018 with contract providers to build an overall delivery system that includes robust services and improves capacity to address unmet client needs.

California Department of Health Care Services Mental Health Plan Network Adequacy Sanctions and Penalties for 10 Counties

The Medi-Cal Managed Care Final Rule included strict regulations for California’s MHPs and DMC-ODS Waiver counties.  These regulations are far more stringent, with a focus on network adequacy, timely access to care, and beneficiary protections.  Each county must complete and submit a quarterly Network Adequacy Certification Tool (NACT) that includes all individual providers in both County operated and contract services (ID# 92055 and 93583). The NACT requires geo-maps of each county to ensure an adequate number of clinicians and psychiatrists, geographic distribution of services and language capacity.  The State Department of Health Care Services (DHCS) monitoring and enforcement effort is sharply focused on regulatory compliance. The BHSD contract provider effort to increase rates for clinical and quality roles, provide trainings and technical assistance, develop contract monitoring tools, and align the contracts were designed to ensure beneficiaries received timely and appropriate care and to position Santa Clara County to comply with the regulations.   

On April 18, 2019, the DHCS took action and mailed notices to the Behavioral Health Directors, County Administrators and Boards of Supervisors in ten Central Valley counties, notifying them of the potential impositions of sanctions and nonrefundable penalties for the counties’ failure to comply with September 2018 Correction Action Plans (CAPs) to certify adequate provider network for county behavioral health clients. The California State Association of Counties (CSAC) provided the following quick facts:

·        Sanctions, which would be achieved by withholding 50% of a county’s monthly average Federal Finance Participation (FFP), begin June 8, 2019.

·        Sanctions will be withheld and refunded to the county upon proof of compliance.

·        Civil penalties will be calculated beginning July 1, 2019. These penalties will equal 10% of the number of beneficiaries x $500 per beneficiary.

·        Civil penalties will not be refunded to the county.

·        Counties may appeal within 60 days to the DHCS Office of Administrative Hearings and Appeals, but the appeal will not stay any sanctions or penalties.

·        DHCS must submit its second annual network certification to the Centers for Medicare and Medicaid Services in July 2019; upon completion of its analysis, DHCS may impose additional corrective actions upon the MHPs for inadequate network adequacy.

Federal Office of the Inspector General (OIG) Audit of State of California Specialty Mental Health Services (SMHS):

In August 2018, the OIG released an audit report of County MHPs, based on specialty mental health services California provided in 2014, and its final audit report recommends that California repay $180.6 million to the federal government due to improperly billed services. The OIG audit reviewed a sample of 500 randomly selected services and found that 89 services did not comply with Federal and State documentation requirements to establish medical necessity, include a client plan or progress notes, and/or provide a direct client service. The OIG reviewed 32 claims from the County and ultimately three of those were disallowed.  The DHCS asked the California State Association of Counties (CSAC) to propose a funding stream from which to recover the repayment from counties and a methodology to allocate the costs of the repayment between counties.  Each county’s share of the $180.6 million recoupment was based on their percentage share of FY 2013-2014 Medi-Cal claims. Under CSAC’s recommended allocation methodology, the County’s 1991 Realignment funding will be reduced by $18.4 million during the next four years.  

See Attachment 5- OIG Report Summary for additional information.

The OIG report recommended that all county MHPs “strengthen oversight of the health plans to ensure that SMHS claims comply with Federal and State requirements” which was supported by the State of California. The BHSD serves as the MHP and DMC-ODS Waiver for the County of Santa Clara and must ensure that the service delivery system, including both County operated services and contract provider services, comply with these requirements. This DOA would support contract compliance with the State and Federal regulations to ensure that the BHSD meets requirements to serve beneficiaries and avoids sanctions, fines or audit recoupments. 

CHILD IMPACT

The recommended actions would have a positive impact on children and youth receiving behavioral health services from impacted contract providers.

SENIOR IMPACT

The recommended actions would have a positive impact on seniors receiving behavioral health services from impacted contract providers.

SUSTAINABILITY IMPLICATIONS

The recommended actions balance public policy and program interests, and enhance the Board of Supervisors’ sustainability goals of social equity and safety by ensuring behavioral health services are accessible and provided to the residents of Santa Clara County in a timely manner. The recommended actions would also ensure that the BHSD is incompliance with State and Federal regulations.

BACKGROUND

The BHSD is Santa Clara County’s Medi-Cal Behavioral Health Managed Care Plan administrator and is required by State and Federal regulations to provide for or arrange behavioral health services for Medi-Cal beneficiaries. Mental health contract services are contained in two types of services: Short-Doyle Medi-Cal and MHSA.  Behavioral health and substance use treatment services are provided to severely mentally ill children, youth, adults, and older adults from all ethnic and cultural populations represented in the County.

On February 6, 2016, the BHSD submitted a DMC-ODS Waiver application to the DHCS. The waiver application requested development of a Managed Care Organization (MCO) for Medi-Cal eligible beneficiaries. In June 2016, BHSD was notified that the CMS had accepted the Waiver plan as submitted. The DHCS also reviewed and accepted the economic model tied to the unit reimbursement rates in October 2016. The DMC-ODS Waiver has allowed the BHSD to further refine and develop this model of care and has provided for a broad range of recovery services that are eligible for Medi-Cal reimbursement. The Countys DMC-ODS Waiver has been recognized by the DHCS and the Centers for Medicare and Medicaid Services (CMS) as the model for other counties in California. The DMC-ODS Waiver aligns with the Mental Health Plan managed care requirements.

In May 2017, the CMS sent a list of updated contract deliverables to the BHSD that reflected a transformation and overall system update of Final Rule regulations. Under this large-scale reform, all MHPs and DMS-ODS Waiver counties, including the BHSD , were required to update the terms and requirements of its services, including those of its contract providers to adhere to the new State and Federal regulations. These reforms include, but are not limited to: (1) supporting State efforts to advance delivery system reform and improve the quality of care; (2) strengthening the beneficiary experience of care and protections; (3) strengthening program integrity by improving accountability and transparency; and (4) aligning key Medicaid and Children’s Health Insurance Program managed care requirements with other health coverage programs.

The BHSD has been working with the Department of Health Care Services (DHCS) to update its contract terms on a regular basis, as the DHCS regularly sends updated Information Notices that add or clarify new State and Federal requirements related to the delivery of behavioral health services. In order to comply with this ongoing robust reform of regulations, BHSD also regularly meets with its contract providers and updates their contracts as necessary. This includes distributing memos along with hosting comprehensive trainings, monthly meetings, and question and answer sessions to ensure that contract providers are in compliance with these new requirements. See Attachment 1- Frequently Asked Questions (FAQs) and Memos, Attachment 2: Implementing the Managed Care Rule: Network Adequacy Standards, and Attachment 3: California County Mental Health Financing 101 for examples of information, FAQs, and free technical trainings that BHSD has developed and distributed in collaboration with Harbage Consulting.

Individual contract provider monthly meetings were launched in November 2018 and held every month to discuss their contracts, programs, service capacity and budgets.  The BHSD System of Care Executives, Finance Manager for Contract Providers, ASM II for Contracts and the Senior Health Care Program Manager for System Initiatives participate in these meetings. Decision Support developed a spreadsheet for each provider that includes all contracted programs, the number of contracted client slots, number of utilized slots and program budget vs. actual budget. 

On March 21, 2019, the BHSD convened a FY 2020 Renewals Process Meeting for the MH and SUTS contract providers. This meeting was open to all service providers with programs related to SD/MHSA contracting and/or SUTS contracting. At the meeting, BHSD reviewed updates to the FY 2020 contract requirements and renewal timeline, summarized FY 2019 contracting activities, provided an overview of current contract performance by MH and SUT contract providers, shared contract provider performance data by agency and program, and held a question and answer session. All contracting activities and rate increase processes from May 2017 to March 2019 related to the Medi-Cal Managed Care Final Rule and DMC-ODS requirements are included in Attachment 4 – FY 2020 SD-MHSA and SUTS Renewal Process Presentation.

BHSD is currently working on the FY 2020 renewal agreements to integrate approved provider requests for budget/service adjustments, tools to track performance based on State and Federal regulations, and updated service parameters where necessary. This work is a continuation of the significant FY 2018 –2019 BHSD contracting activities necessary to transform and align the behavioral health system with the State and Federal standards.

Each FY 2020 contract will include new language that would allow BHSD to establish performance incentives for contract agencies that are meeting contract obligations, as noted below:

BHSD reserves the right to establish performance incentives based on, but not limited to the following measures: 1) CONTRACTOR’s performance based on data submitted through the BHSD Contract Monitoring Tool and other data report submissions as required by this AGREEMENT; 2) CONTRACTOR’s compliance with Medicaid (Medi-Cal) Managed Care rules and regulations (e.g., Network Adequacy requirements); and 3) outcomes, service performance/delivery, and metrics listed in the AGREEMENT.

BHSD continues to work closely with the contract providers to make targeted rate adjustments in key areas to ensure adequate fiscal resources for contract providers to better serve County clients while maintaining the County’s ability to draw down non-General Fund revenues (e.g., Realignment and MHSA) and reimbursements in support of those services. Specifically, the purpose of BHSD adjustments was to:

·        Address providers' difficulty recruiting and retaining clinical and quality staff given the statewide professional shortage and the competitive Bay Area behavioral health market;

·           Provide contracted service capacity to meet the needs of BHSD clients;

·           Comply with the Federal Network Adequacy and Timely Access Standards for MHP and DMC-ODS Pilot Counties; and

·           Ensure the County and BHSD providers meet reimbursement rate criteria and generate revenue for the system.

The table below illustrates the impact of the clinical and quality staff rate increases and the increase in capacity to serve clients, which is monitored monthly.

 

Yearend Estimates based on July 2018- January 2019 Annualized Data

Yearend Estimates based on March 2019 Annualized Data

 

FY 2019 Budget Active Caseload

FY 2019 July- January Annualized Estimates

Variance to Budget

Percentage Variance

FY 2019 March Annualized Estimates

Variance to Budget

Percentage Variance

Totals

14,464

11,039

(3,425)

-23.7%

11,956

(2,508)

-17.3%

 

Contract Provider Budget Adjustments and Redistribution of Funds for Services

Budget adjustments represent unspent funds within a contract provider agency that have not been utilized for services over a period of time, thereby limiting service capacity for beneficiaries and the County’s ability to draw down the federal match to increase revenues and meet budget expectations.  The budget adjustment funding would be redistributed to expand services where needed.  Contract providers that have met their contract obligations, increased their staffing and can provide additional service capacity in specific areas of need, would submit a request to BHSD asking for a funding increase, which would be supported by redistributed funds.

CONSEQUENCES OF NEGATIVE ACTION

Failure to approve the recommended action would negatively impact the BHSDs ability to meet its obligation to ensure Medi-Cal beneficiaries receive care and would negatively impact the timely renewal of agreements with contract providers that adjusts the overall behavioral health delivery system in a manner that ties financial obligations to the cost of providing appropriate levels of care. It would also delay the processing of contracts and vendor payments with the adjusted rates and terms required to qualify the BHSD for reimbursement of Federal claims.

STEPS FOLLOWING APPROVAL

Priority processing is requested for this DOA. Upon approval, the Clerk of the Board is requested to send an e-mail notification to Evonne Lai at Evonne.Lai@hhs.sccgov.org.

Meeting History

May 7, 2019 9:30 AM Video Board of Supervisors Regular Meeting

At the request of Supervisor Ellenberg, the Board directed Administration to include status updates on all major health service contracts for Fiscal Year 2020 in the monthly reports to the Health and Hospital Committee.

RESULT:APPROVED [UNANIMOUS]
MOVER:Cindy Chavez, Vice President
SECONDER:Mike Wasserman, Supervisor
AYES:Mike Wasserman, Cindy Chavez, Dave Cortese, Susan Ellenberg, S. Joseph Simitian