Mental Health Licensing

Mental Health Licensing

Rehab Licensing Experts!

Licensing a Mental Health Residential Treatment Program can be a daunting task, but Circa Behavioral Healthcare licensing experts have years of experience and know all of the right steps and contacts. Our team can expedite the process and reach your goals. To give you an idea of the steps that are taken during the licensing process, here is our checklist:

Mental Health Rehab Pre-licensing considerations

  • Form a company in California or in another state, but register it as a foreign entity allowing it to operate in California
    • Any individual with 10% or more ownership in the company will need to pass a Live Scan
  • Pro-forma budget
    • Plan conservatively and be properly funded to know when you plan to break even
      • Assure you have three month’s operating costs in the company’s bank account(s) as the state licensing agency will need proof of this
    • Have a plan for marketing the program
      • Existing network
      • Referral relationships
      • Digital marketing
    • Rent and payroll largest expenses
      • If billing private insurance, revenue cycle will not finish with money in the bank until 60 days after billing
    • Control of a property
      • Conduct a radius check as the state agency will not allow for a licensed facility within 300 feet of another licensed facility
        • Check local zoning and ability to obtain a business license
      • Lease vs. Own
        • If a lease, assuring term is long enough to display consistency
          • Have a good, transparent, relationship with landowner as the state licensing agency will need their name and contact information
          • Assure the lease agreement contains language authorizing the premises to be utilized for what is being applied for on the license
        • Stay away from properties with Homeowners Associations
      • Hire/contract with key staff
        • Have a medical director
        • Have a program director
        • Have an administrator
          • All key staff and future must be able to pass a Live Scan
        • Have a policy and procedure manual

During Rehab licensing considerations

  • Prepare for fire clearance
  • Obtain furniture and supplies
  • Purchase a vehicle
  • Ensure life and environment of care safety through planning and risk management as well as state pre-licensing compliance
  • Start hiring qualified staff
    • Set up an human resources system
      • Ensure all proper documentation
    • Choose and implement an electronic medical record (EMR)
      • Assure all state and accreditation compliance is met through the ERM
    • Apply for an NPI
    • Choose a billing company
    • Apply for accreditation
    • Obtain the right liability insurance
    • Have a plan for “not in my backyard (NIMBY)” neighbor/community attitudes, discrimination, and stigma
    • Post appropriate postings
  • Post licensing considerations
    • Post state license and certification
    • Credential with the insurance carriers
    • Start training staff before treating first client and obtain appropriate competencies
    • Obtain accreditation as soon as possible
      • Post accreditation certificate
    • Follow pro-forma budget projections and adjust as necessary
    • Have good leadership

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