California’s residential services rate reform represents a shift for developmental disabilities providers. By optimizing the rate-setting process, standardizing service requirements, and incentivizing quality through the Quality Incentive Program, the reform aims to enhance the sustainability, quality, and transparency of community-based services. Here's what providers need to know to navigate the transition effectively.

Collaboration with Regional Centers

Regional centers will play a crucial role in the reform process. They are responsible for verifying provider information, aligning service descriptions and codes, and implementing new rate structures. Providers must work closely with regional centers to complete the Rate Reform Service Acknowledgment Form by March 31, 2025. This form documents service descriptions, subcode combinations, and new rates, ensuring compliance and continuity of care.

Customized Rates for Specialized Facilities

For Adult Residential Facilities for Persons with Special Healthcare Needs (ARFPSHN) and Group Homes for Children with Special Healthcare Needs (GHCSHN), customized rate setting ensures that reimbursement reflects specific staffing and service requirements. These rates consider factors like administrator qualifications, direct care staffing hours, and consultant hours. The use of worksheets facilitates accurate rate calculations tailored to each facility’s needs.

Aligning Service Descriptions and Codes

Aligning current service descriptions with updated definitions is one of the keys to the reform. Providers must match their services with one of the newly standardized codes (e.g., 905, 910, 915, 920) and complete the acknowledgment process. Facilities transitioning from outdated classifications will use updated codes starting January 1, 2025.

Service Levels and Staffing Requirements

The reform consolidates the previous 11 service levels into 5 standardized levels (2-6), with an additional Level 7 for highly specialized facilities. Each level includes specific staffing and consultant hour requirements:

• Service Level 7: Requires customized staffing and consultant hours exceeding Level 6, with specialized qualifications like registered behavior technicians or licensed vocational nurses.

• Deadline: Providers must meet updated requirements by December 31, 2025. A ramp-up period allows time for adjustments.

Facilities must ensure staff are awake during night shifts, with some exceptions allowed for Levels 2 and 3 if noted in Individual Program Plans (IPPs).

Transition and Implementation

Providers must align their services with updated requirements while maintaining continuity of care. IPPs should reflect new service codes and descriptions but do not require updates unless staff changes or new codes significantly alter service delivery. Regional centers will oversee this transition to minimize disruptions for individuals served.

Resources

The following resources provide essential guidance on navigating these changes:

• Department of Developmental Services (DDS):
  https://www.dds.ca.gov

• Regional Center Contacts:
  https://www.dds.ca.gov/rc

• Rate Models Overview:
  https://www.dds.ca.gov/rc/vendor-provider/rate-reform/rate-models/

• Quality Incentive Program:
  https://www.dds.ca.gov/rc/vendor-provider/quality-incentive-program/

• Rate Reform Full Implementation Overview:
  https://www.dds.ca.gov/wp-content/uploads/2024/09/D-2024-Rate_Reform_001_Rate_Reform_Full_Implementation_Overview.pdf

The residential services rate reform introduces significant changes but offers an opportunity to enhance the quality and sustainability of care. Collaboration with regional centers, accurate service alignment, and proactive adaptation are key to success. Providers who navigate these changes effectively will be well-positioned to deliver high-quality services and meet the evolving needs of California's developmental disabilities community.