Section 14712.

(a) Notwithstanding any other provision of state law, the department shall implement managed mental health care for Medi-Cal beneficiaries through contracts with mental health plans. Mental health plans may include individual counties, counties acting jointly, or an organization or nongovernmental entity determined by the department to meet mental health plan standards. A contract may be exclusive and may be awarded on a geographic basis.

(b) Two or more counties acting jointly may agree to deliver or subcontract for the delivery of specialty mental health services subject to the approval by the department. The agreement may encompass all or any portion of the specialty mental health services provided pursuant to this chapter. This agreement shall not relieve the individual counties of fiscal responsibility for providing these services. Any agreement between counties shall delineate each county's responsibilities and fiscal liability for overpayments.

(c) (1) The department shall contract with a county or counties acting jointly for the delivery of specialty mental health services to each county's eligible Medi-Cal beneficiary population. If a county decides not to contract with the department, does not renew its contract, or is unable to meet the standards set by the department, the county shall inform the department of this decision in writing.

(2) If the county is unwilling to contract for the delivery of specialty mental health services, the department shall ensure that specialty mental health services are provided to Medi-Cal beneficiaries.

(3) If the department or county determines that the county is unable to adequately provide specialty mental health services, or that the county does not meet the standards of a mental health plan, the department shall ensure that specialty mental health services are provided to Medi-Cal beneficiaries.

(4) The department may contract with qualifying individual counties, counties acting jointly, or other qualified entities approved by the department for the delivery of specialty mental health services in any county that is unable or unwilling to contract with the department. The county may not subsequently contract to provide specialty mental health services under this chapter unless the department elects to contract with the county.

(d) If a county does not contract with the department or other department-approved entity to provide specialty mental health services, the department shall work with the Department of Finance and the Controller to sequester funds from the county that is unable or unwilling to contract in accordance with Section 30027.10 of the Government Code.

(e) Whenever the department determines that a mental health plan has failed to comply with this chapter or any regulations, contractual requirements, state plan, or waivers adopted pursuant to this chapter, the department shall notify the mental health plan in writing within 30 days of its determination and may impose sanctions, including, but not limited to, fines, penalties, the withholding of payments, special requirements, probationary or corrective actions, or any other actions deemed necessary to promptly ensure contract and performance compliance. If the department imposes fines or penalties, to the extent permitted by federal law and state law or contract, it may offset the fines from either of the following:

(1) Funds from the Mental Health Subaccount, the Mental Health Equity Subaccount, and the Vehicle License Collection Account of the Local Revenue Fund and funds from the Mental Health Account and the Behavioral Health Subaccount of the Local Revenue Fund 2011.

(2) Any other mental health realignment funds from which the Controller is authorized to make distributions to the counties, if the funds described in paragraph (1) are insufficient for the purposes described in this subdivision.

(f) The due process and appeals process specified in paragraph (4) of subdivision (b) of Section 14718 shall be made available to the mental health plan under the circumstances described in subdivision (e).

(Added by renumbering Section 5775 by Stats. 2012, Ch. 34, Sec. 173. Effective June 27, 2012. Operative July 1, 2012, by Sec. 254 of Ch. 34. Conditionally inoperative as provided in Section 14721.)