Vendorization - What is it?

Vendorization is the process by which Regional Centers approve prospective vendors to provide services to Regional Center consumers. There are 21 Regional Centers in California. Regional Centers provide assessments, case management services and purchase services for people with developmental disabilities. Each Regional Center is responsible for a defined geographic area. Inland Regional Center provides services in San Bernardino and Riverside Counties. Regional Centers may vendor only those providers who reside within their assigned catchment area.

Prospective vendors are advised to contact the Regional Center Resource Development Unit before developing services to discuss the need for the proposed service and any local issues and concerns. Regional Centers may have additional information about services that can assist a prospective vendor. Taking this step can save prospective vendors money and time and start the relationship with the Regional Center on a positive note!

To become a vendor, the prospective provider must complete an application packet. The application packet will include a variety of forms, all of which must be completed. Depending on what service the provider wants to provide, there may be licensing, certification and program design requirements which must be met before an application is accepted by the regional center. The requirements for each service category are specified in Title 17, California Code of Regulations, Section 54302.

The prospective vendor returns the application packet and required license(s)/certification(s) to the regional center. The regional center then has 45 days from the date of receipt of the completed application to determine if the applicant meets the requirements of Title 17, and if the applicant possesses the skills necessary to provide quality services required by Inland Regional Center. If approved, the regional center issues a Vendor Approval Letter that contains the provider’s Vendor Identification Number, approved service code and effective date. If the application is denied, the provider will receive a letter stating the reasons for the denial and the provider’s appeal rights, in accordance with Title 17 Regulations. Completing the vendorization process, does NOT guarantee nor imply availability of individual referrals or placements.

Vendorization is not a blanket process. Each service must be vendored separately. For example, if a service provider offers residential and out of home respite, both services must be vendored and approved separately. Vendors should retain the approval letter(s) issued by the regional center, as this letter contains the Vendor Identification Number, service code and effective date that will be needed to bill the regional center for services.

The vendor’s rate is determined by the service category type. This information is also specified in Title 17 Regulations. There are several types of rate methodology structures. They include: a) SMA- the Schedule of Maximum Allowable rate for the service provided as established by the Department of Health Services for services reimbursable under the Medi-Cal program; b) Negotiated Rate - the rate is mutually agreed upon by the regional center and the service provider for a specific service and time frame; c) Cost Statement - is based upon the vendor’s program, allowable cost, consumer attendance, vendor income, and as applicable, regional center payment information. Additionally, some rates are established by the Department of Developmental Services. The type of rate structure paid to the service provider is referenced in the Vendor Approval Letter.

Vendorization must be completed before services are provided as Title 17 prohibits regional centers from paying for services that are provided prior to vendorization. Once vendored, the provider’s demographic and approved service information is added to the Statewide Vendor Panel, which provides access to each of the 21 regional centers to authorize and purchase services from the service provider.

Regional Center contracts with vendors, they are not employees of the Regional Center or the Department of Developmental Services. Vendors are responsible for complying with all State and Federal employment and tax laws. Vendorization is non-transferable. Title 17 California Code of Regulations prohibits vendors from transferring vendorization of their service to another person or entity. The vendor must notify the vendoring regional center at least 30 days prior to any change in ownership, location or in the required license, certificate, registration, credential or permit.

When a change of ownership occurs, the new owner must meet the requirements for vendorization, including all licensing/registration/certification requirements for the service being provided. Vendors must notify the vendoring regional center and all user centers in writing at least 60 days before discontinuing service or making modifications to the program design or service curriculum.

In addition to the requirements specified above, all vendors are required to do the following:

  • Provide access to regional center and/or Department staff, on an announced or unannounced basis, for the purpose of monitoring services and supports purchased by the regional center. Regional Center staff shall have access to the provider’s grounds, buildings and service program, and to all related records, including books, computerized data, accounting records and related documentation.
  • Maintain records of services provided to consumers in sufficient detail to verify delivery of the units of service billed.

a)Such records shall be maintained for a minimum of five years from the date of origination or until audit findings have been resolved, whichever is longer.

b) Records must be specific to the date, actual service time, location, nature of services provided, units of service provided and consumer’s name.

c) Attendance data, as specified above, for the billing period shall be submitted to the regional center with the billings/invoices.

  • Make available any books and records pertaining to the vendored service, including those of the management organization, if applicable, for audit, inspection or authorized agency representatives. This shall also include only those portions of any personnel records that are necessary to ensure staff qualifications comply with the requirements contained in Title 17, CCR, Sections 56724, and Section 56770 or 56792, as applicable, in order to comply with the monitoring of program standards pursuant to the Welfare and Institutions Code, Section 4691(f).
  • Utilize and be bound by Title 17, Sections 50700 through 50767, and the Welfare and Institutions Code, Section 4648.2, should the vendor elect to appeal any audit findings.
  • Comply with the provisions contained in the Fair Labor Standards Act.
  • Not discriminate in the provision of services to consumers on the basis of race, religion, age, disability, sex, or national origin of the consumer, or his/her parents, guardian, or conservator.
  • Provide certification consistent with the Public Contract Code, Sections 10410 and 10411, that the vendor and the agents or employees of the vendor, in the performance of the contracts, are independent contractors and are not officers or employees of the State of California.
  • Bill only for services which are actually provided to consumers and which have been authorized by the referring regional center.
  • Not bill for consumer absences for nonresidential services.
  • Agree to accept the rate established, revised or adjusted by the Department as payment in full for all authorized services provided to consumers and not bill the consumer nor the consumer's family, conservator, guardian or authorized consumer representative for a supplemental amount regardless of the cost of providing the authorized service. This shall not preclude the vendor from billing the consumer or consumer's family for services provided which were authorized by the consumer or family and which were not authorized by the regional center;
  • Comply with all applicable staffing ratio requirements;
  • Be prohibited from being vendored by more than one regional center for the same service at the same location.
  • Comply with conflict of interest requirements as determined by the criteria established by Title 17, Sections 54500 through 54525 and the Welfare and Institutions Code, Sections 4626 through 4628.
  • Sign Form DS 1896, Home and Community Based-Services Provider Agreement.
  • Report all Special Incidents as specified in Title 17 Regulations, Section 54327, to the vendoring regional center and the regional center which provides case management services, as applicable.
  • Promote consumer’s rights and only deny rights in accordance with Title 17, Sections 50500 through 50540.
  • Adopt written internal policies and procedures to resolve consumer grievances pursuant to the Welfare and Institutions Code, Section 4705.
  • Maintain and keep confidential all consumer information and utilize such information only as necessary to provide safe and effective services in accordance with the W&I Code, Sections 4515 - 4518 and the Health Insurance Portability and Accountability Act of 1996 (HIPAA).
  • The vendor shall maintain a written description of its organizational structure and operations at the vendor's business office in accordance with Title 17, Section 54326(b).

Vendorization may be terminated by the regional center if the vendor is in violation of regulations. Termination may occur when:

  • The vendor is serving consumers without a current license, credential, registration, certificate, degree or permit that is required for the performance or operation of the service.
  • Vendorzation has been transferred to another person or entity.
  • The vendor has refused to make available any books and records pertaining to the vendored service.
  • The service being provided is not the same service that was approved for vendorization.
  • The vendor is using planned behavior modification interventions that cause pain or trauma.
  • The vendor is transporting consumers using a driver who does not possess a valid California driver’s license appropriate for the vehicle being driven.
  • The regional center has determined that continued utilization of the vendor’s services threatens the health and safety of the consumers.

A vendor or an applicant has the right to appeal denial of vendorization, termination of vendorization or failure of the regional center to comply with regulations in accordance with Title 17, Sections 54380 - 54390.

You may review Title 17 California Code of Regulations and the Lanterman Act, Welfare & Institutions Code by accessing this internet web address: http://www.dds.ca.gov.

Sections 50500 through 50550 . . . . . . . . . . . Clients Rights

Sections 50605 through 50767 . . . . . . . . . . . . Service Provider Accountability & Audit Standards

Sections 54300 through 54390 . . . . . . . . . . . . Vendorization and Service Code Information

Sections 54380 through 54390 . . . . . . . . . . . . Vendor Appeal Procedure