How to start a behavioral health clinic in California

California does not require a state license for a behavioral health clinic, according to California Department of Health Care Services — Licensing and Certification Division (SUD). California DHCS alcohol and other drug (AOD) program certification — outpatient and nonresidential SUD programs.

License required

No

License

DHCS Alcohol and Other Drug (AOD) Program Certification (outpatient / nonresidential / day treatment)

Issuing agency

California Department of Health Care Services — Licensing and Certification Division (SUD)

Fee

FY 2025-26 (from July 1, 2025): initial outpatient certification application fee $5,064; initial biennial outpatient certification fee $6,564; biennial outpatient certification extension fee $6,564. DHCS raised fees again from July 1, 2026 (BHIN 26-004) under SB 104's phased increase of up to 75% cumulative by FY 2026-27; the FY 2026-27 amounts were not captured here.

Renewal

Every 2 years · Biennial outpatient certification extension fee ($6,564 in FY 2025-26; higher from July 1, 2026).

Regulation

DHCS Alcohol and Other Drug Certification Standards (v1.0, October 2023); Cal. Health & Safety Code fee authority per SB 104

1. Read the DHCS AOD Certification Standards
2. Complete the DHCS Initial Application for Certification (DHCS 6040) with all required documents
3. Email the application to DHCS (LCDSUDApplication@dhcs.ca.gov) and pay the application and certification fees (ACH payment available)
4. DHCS reviews the application and the program for compliance with the AOD Certification Standards
5. Keep certification current through the biennial extension and fee

Program

Medi-Cal

Enrollment portal

Provider Application and Validation for Enrollment (PAVE)

Fiscal agent

California MMIS Fiscal Intermediary (claims/billing); fee-for-service enrollment itself is done by the DHCS Provider Enrollment Division (PED)

Application fee

DHCS charges $750 for applicable applications submitted in calendar year 2026, paid by EFT inside PAVE (or cashier's check for paper applications). DHCS exempts individual practitioners and physician and non-physician practitioner groups. Federal rule (42 CFR 455.460): the state must collect the CMS application fee from institutional providers that are newly enrolling or re-enrolling; individual physicians and non-physician practitioners are exempt, as are providers already enrolled in (or that already paid the fee to) Medicare or another state's Medicaid/CHIP. CMS set the fee at $750 for calendar year 2026.

Fingerprinting

Federal rule (42 CFR 455.434, 455.450(c)): providers the state places in the 'high' categorical risk level, and anyone owning 5% or more of such a provider, must submit fingerprints for a criminal background check.

Site visit

For managed care network providers that a plan screens itself, DHCS requires the plan to repeat post-enrollment site visits at least every five years for moderate-risk and every three years for high-risk providers (APL 22-013). Federal rule (42 CFR 455.432, 455.450(b)-(c)): the state must do site visits before and after enrollment for providers in the 'moderate' or 'high' risk levels, and any enrolled provider must allow unannounced on-site inspections.

Revalidation

Revalidation requests come through PAVE. In June 2026 DHCS told CMS it would run a risk-based two-year campaign to revalidate high-risk providers early, beyond the federal schedule. Federal rule (42 CFR 455.414): every enrolled provider must be revalidated at least once every 5 years.

Full California Medicaid enrollment guide →

CON program

No

California certificate of need details →

State minimum wage

$16.90 an hour

Effective

2026-01-01

Scheduled increases

Rises to $17.40 on 2027-01-01 (annual CPI adjustment).

Direct-care wage floor

SB 525 health care worker minimum wage covers licensed home health agencies (and skilled nursing facilities owned or controlled by a hospital or integrated system); independent SNFs, residential care and congregate living health facilities are not covered. Rates are tiered by facility type; for the residual 'all other covered health care facilities' tier the minimum is $23.00/hour from 2026-07-01, rising to $25.00 on 2028-07-01.

HCBS 80/20 rule

Federal baseline: 42 CFR 441.302(k) requires the state to show that each provider spends at least 80% of Medicaid payments for homemaker, home health aide and personal care services under 1915(c) waivers on direct care worker pay and benefits. Compliance starts 2030-07-09 (for managed care, the first rating period starting on or after that date); annual payment-adequacy reporting under 441.311(e) starts 2028-07-09. A state may set a lower share for state-defined small providers and exempt providers facing hardship, each only through a public notice-and-comment process. The eCFR text has not changed since 2024-07-09. No state-published 80/20 implementation step (small-provider criteria, hardship exemption or reporting guidance) was found for this state in the official sources reviewed.

Community/behavioral health agencies and mental health clinics — active organization NPIs (NPPES)

11,283 (as of Sep 13, 2026)

Total Medicaid and CHIP enrollment (latest reported month)

11,659,421 (as of Jun 1, 2026)

All California Behavioral health Medicaid rates, ranked →

• 1915(i) State Plan HCBS for People with Developmental Disabilities (1915(i))
• Assisted Living Waiver (1915(c))
• Community First Choice Option (CFCO) (1915(k))
• HCBS Waiver for Californians with Developmental Disabilities (1915(c))
• Home and Community Based Alternatives Waiver (1915(c))
• Medi-Cal Waiver Program (MCWP) (1915(c))
• Multipurpose Senior Services Program Waiver (1915(c))
• Self-Determination Program for Individuals with Developmental Disabilities (1915(c))

California waivers and waiting lists →