County Board of Supervisors · Tuesday, October 6, 2026, 9:00 AM · Item 24 · CONSENT AGENDA
Agreements between county mental health and drug treatment plans and Alliance for Health
In plain English
The County's Health Services Agency asks the Board to approve three agreements with Central California Alliance for Health, the main Medi-Cal managed care plan in the county. Two are written agreements (Memoranda of Understanding) spelling out how the Alliance and the County's Behavioral Health Division will coordinate care — one for the County's Specialty Mental Health Plan and one for its Drug Medi-Cal Organized Delivery System, which covers substance use treatment. The third, Contract No. 27R0513, is a cost-sharing deal expected to bring the County about $415,000 a year by billing the Alliance for certain physical health costs the County pays up front. A yes vote approves all three and lets the Health Services Agency Director or a designee sign them and any related amendments.
The agreements set the rules for how Medi-Cal patients in Santa Cruz County move between physical health care, mental health care and substance use treatment, and 99.5% of County Behavioral Health clients are Alliance members.
Key facts
- Estimated annual revenue of approximately $415,000 under Contract No. 27R0513, budgeted in Behavioral Health's FY 2026-27 Budget under account 363140/41678.
- The Alliance will reimburse the County for 50% of the costs of medically necessary residential and partial hospitalization programs for eating disorder services.
- The Alliance will reimburse 100% of eligible 'Medical Patch' costs — extra payments to residential facilities for added staffing, supplies or personal care — for shared clients at Montecito Manor and 7th Avenue.
- The state Department of Health Care Services required these standardized agreements in 2024 under the CalAIM initiative (Behavioral Health Information Notices 23-056 and 23-057, and Administrative Policy Letter 23-029).
- The two Memoranda of Understanding are non-monetary; no new County General Funds are needed or requested.
Reasons to support
- The agreements keep the County in compliance with state CalAIM rules and avoid the risk of corrective action from the state Department of Health Care Services, protecting Medi-Cal funding streams.
- The cost-sharing agreement lets Behavioral Health recover roughly $415,000 a year in physical health costs — eating disorder treatment, incontinence supports and special diets — that are the Alliance's financial responsibility.
- The new agreements replace the 2017 agreement and its 2022 amendment with standardized terms: named liaisons at each plan, quarterly joint meetings, defined screening and referral pathways, data-sharing rules under federal health privacy law, and a dispute process that can escalate to the state.
Reasons to oppose or change it
- The County pays residential subcontractors up front and then invoices the Alliance, so the County carries the cost and the collection risk if reimbursements are delayed or denied.
- Actual revenue will vary with the number and type of eligible services, so the $415,000 built into the FY 2026-27 budget is an estimate based on past collections rather than a guaranteed amount.
- Recommendation 4 would let the Health Services Agency Director or a designee sign the agreements and any related amendments without returning to the Board, reducing public review of later changes.
Official wording
Approve Memorandum of Understanding between Santa Cruz-Monterey-Merced-San Benito-Mariposa Managed Medical Care Commission dba Central California Alliance for Health (CCAH) and County of Santa Cruz Health Services Agency’s Mental Health Plan, approve Memorandum of Understanding between CCAH and County of Santa Cruz Health Services Agency’s Drug Medi-Cal Organized Delivery System health plan, and take related actions (Health Services Agency) Land Use & Community Services
Summary written by claude-opus-5 from the agenda and the Staff Report. It can contain mistakes. The official documents govern.