California - Residential Care Service — Licensing, Medicaid Enrollment and Startup Requirements

Last reviewed: 2026-09-09

The California Department of Social Services (CDSS) Community Care Licensing Division (CCLD) licenses 24-hour residential settings as Residential Care Facilities for the Elderly (RCFE) or Adult Residential Facilities (ARF), which are funded under the Medi-Cal Assisted Living Waiver (ALW). These facilities are classified as social-based community settings rather than healthcare facilities, though they must provide or arrange for skilled nursing services to meet waiver participant needs.

Before applying for Medi-Cal ALW enrollment through the Department of Health Care Services (DHCS), a facility must already hold an active CDSS license, be in substantial compliance with Title 22 regulations, and have no pending accusations or probationary status under Health and Safety Code Section 1569.33. DHCS will not process a Medi-Cal enrollment packet for the ALW program if the underlying facility license is provisional or under disciplinary action.

1. Service Definition and Scope

Under the California Assisted Living Waiver (ALW), Residential Care Facilities for the Elderly (RCFE) and Adult Residential Facilities (ARF) provide 24-hour care and supervision to Medi-Cal beneficiaries who require a nursing facility level of care but choose to live in a community setting. The facility works in conjunction with Care Coordinator Agencies (CCA) to ensure individualized care.

While licensed as residential facilities, ALW providers must ensure participants receive necessary health services, including skilled nursing, while maintaining a homelike environment with private or semi-private bathrooms and common dining areas.

• Personal Care: Provision and oversight of personal and supportive services.
• Medication Assistance: Assist with self-administration of medication.
• Nutrition: Provide three meals per day plus snacks.
• Ancillary Services: Housekeeping, laundry, and arranged transportation.
• Skilled Nursing: Skilled nursing services provided as needed via employed or on-call licensed nursing staff.
• Emergency Response: Facilities housing more than six participants must have an Individual Response System (IRS).

2. Regulatory and Oversight Agencies

The California Department of Social Services (CDSS) Community Care Licensing Division (CCLD) is the primary regulatory body responsible for issuing facility licenses and conducting periodic health and safety inspections.

The Department of Health Care Services (DHCS) Integrated Systems of Care Division manages the Assisted Living Waiver and processes Medi-Cal provider enrollment applications for licensed facilities.

• Licensing Agency: CDSS Community Care Licensing Division (https://www.cdss.ca.gov/inforesources/senior-care-licensing)
• Medicaid Agency: DHCS Integrated Systems of Care Division (https://www.dhcs.ca.gov/services/ltc/Pages/AssistedLivingWaiver.aspx)
• Enrollment Unit: DHCS Provider Enrollment Unit (PEU) (https://www.dhcs.ca.gov/provgovpart/Pages/PED.aspx)
• Waiver Oversight: DHCS Provider and Facility Site Review Unit (PFSRU) (https://www.dhcs.ca.gov)

3. Gatekeeping Prerequisites: Who Can Even Apply

California strictly sequences ALW provider enrollment: a facility cannot apply to DHCS for waiver funding until it has fully secured its RCFE or ARF license from CDSS. There is no concurrent application process.

Furthermore, DHCS imposes strict compliance gates. Facilities on probation with CDSS or those that have a pending accusation against the licensee are explicitly barred from ALW enrollment under Health and Safety Code Section 1569.33.

• Licensure Prerequisite: Must hold an active, unrestricted RCFE or ARF license from CDSS CCLD.
• Compliance Gate: Must be in substantial compliance and good standing with licensing regulations (Title 22, Section 87101(s)(9)).
• Disciplinary Block: Facilities on probation or with pending accusations are blocked from ALW participation (H&S Section 1569.33).
• Staffing Prerequisite: Must have licensed nursing staff either on call or employed prior to ALW approval.
• Setting Prerequisite: Must offer private or shared bedrooms and meet HCBS settings requirements (42 CFR Section 441.301(c)(4)).

4. Licensure and Certification Requirements

To obtain an RCFE license, applicants must submit a comprehensive application to CDSS CCLD under Title 22, Division 6, Chapter 8 regulations. This includes detailed financial plans, operational policies, and administrator certifications.

The applicant must demonstrate sufficient financial resources to operate the facility and ensure the designated administrator has completed state-mandated training and background clearances.

• Regulation Citation: Title 22, Division 6, Chapter 8 (Residential Care Facilities for the Elderly).
• Administrator Certification: Must complete an 80-hour Initial Certification Training Program from a Department-approved vendor (Section 87406).
• Financial Plan: Start-up funds must be sufficient to meet a minimum of three months of operating costs.
• Background Clearance: Federal Bureau of Investigation (FBI) Clearance required for licensees and administrators.
• Application Fee: Required processing fee based on requested facility capacity (Section 87156).

5. Medicaid Provider Enrollment

Enrolling as an ALW provider requires a two-part application process with DHCS. The programmatic application is submitted via email to the Provider and Facility Site Review Unit (PFSRU), while the formal Medi-Cal enrollment packet must be mailed to the Provider Enrollment Unit (PEU) because it requires original wet signatures.

Both applications are reviewed separately, and delays in either will halt the overall approval. Providers must not send the Medi-Cal packet to the general Provider Enrollment Division, but specifically to the Integrated Systems of Care Division address.

• Program Application: RCFE/ARF Provider Initial Application submitted via email to PFSRU.
• Waiver Agreement: Assisted Living Waiver Program Provider Agreement submitted to PFSRU.
• Settings Verification: Residential Provider Verification form attesting to 42 CFR Section 441.301(c)(4) compliance.
• Medi-Cal Packet: DHCS 6204 form and related Medi-Cal enrollment documents mailed to PEU.
• Signature Requirement: Medi-Cal Enrollment Packet requires original wet signatures; no digital signatures accepted.
• Application Fee: Medi-Cal application requires a fee, whereas the program application does not.

6. Staffing, Training and Background Checks

Facilities must employ sufficient staff to ensure the provision of care and supervision to meet client health and safety needs at all times. This includes specific requirements for the facility administrator and direct care staff.

Because ALW participants require a nursing facility level of care, the facility must have a mechanism to provide skilled nursing services, which requires either employing licensed nurses directly or maintaining formal on-call contracts.

• Administrator Qualifications: Must hold a valid RCFE administrator certificate and pass an FBI background check.
• Nursing Staff: Must have licensed nursing staff (RN or LVN) either on call or employed to provide skilled services.
• Direct Care Staff: Must receive instruction and training on personal care, supervision, and emergency response.
• Background Checks: All staff providing direct care must clear Department of Justice and FBI criminal background checks.
• Staffing Ratios: Must maintain sufficient staff-to-resident ratios to meet the specific care needs outlined in resident appraisals.

7. Documentation, Policies and Records

RCFE and ARF providers must maintain extensive documentation on-site for CDSS CCLD inspections and DHCS waiver audits. This includes a comprehensive Plan of Operation and individualized resident records.

Facilities must also execute specific Admission Agreements with all residents, detailing the services provided, eviction policies, and fee structures, which must align with Medi-Cal ALW rules for waiver participants.

• Plan of Operation: Must maintain a current plan as specified in Title 22 Section 87208.
• Admission Agreement: All documents a resident must sign at admission, detailing rights and fees (Section 87101(a)(2)).
• Hospice Care Plan: If operating under a Facility Hospice Care Waiver, must maintain plans meeting Section 87633 requirements.
• Financial Records: Must maintain ongoing financial records demonstrating the ability to sustain operations.
• Resident Appraisals: Documented pre-admission and ongoing appraisals of resident care needs.

8. Billing, Rates and Claims

ALW services are billed to Medi-Cal through the DHCS MMIS system based on tiered reimbursement rates determined by the participant's assessed level of care. The waiver pays for the care and supervision components of the residential setting.

Medi-Cal does not pay for room and board. Instead, room and board is typically funded by the resident's Supplemental Security Income (SSI) and the state's Optional State Supplement (OSS), minus a mandated Personal Needs Allowance (PNA).

• Waiver Billing: Claims submitted to DHCS for ALW care services based on authorized tier levels.
• Room and Board: Funded separately by resident SSI/OSS; Medi-Cal waiver funds cannot be used for rent or food.
• Personal Needs Allowance: Residents must be allowed to retain a state-mandated PNA from their monthly income.
• Preadmission Fees: Regulated under Health and Safety Code Section 1569.651(e); ALW providers cannot charge waiver participants extra fees for covered services.
• Claim System: Billed through the Medi-Cal Provider Portal/MMIS.

9. Approval Sequence and Timeline

The approval sequence is strictly linear. An applicant must first secure the physical location, pass CDSS CCLD fire and safety inspections, and obtain the RCFE/ARF license. Only then can the DHCS ALW application process begin.

Once the DHCS program application (emailed) and Medi-Cal packet (mailed) are submitted, DHCS conducts separate reviews. Upon approval of both, an on-site or off-site visit is conducted to verify qualifications before final enrollment status is granted.

• Step 1: Obtain CDSS CCLD RCFE or ARF license (timeline varies, typically 6-12 months).
• Step 2: Email Initial Application and Provider Agreement to DHCS PFSRU.
• Step 3: Mail Medi-Cal Enrollment Packet with wet signatures to DHCS PEU.
• Step 4: DHCS Application Review (subject to delays if packets are incomplete or use staples/binders).
• Step 5: Verification Visit (on-site or off-site) conducted by DHCS.
• Step 6: Final notification of Medi-Cal ALW enrollment status issued.

10. Common Denials and Survey Findings

Applications for ALW enrollment are frequently delayed or denied due to administrative errors in the Medi-Cal packet or underlying licensing issues. DHCS explicitly warns that incomplete applications or failure to respond timely to requests for information will lead to application closure.

During CDSS surveys, common citations that can jeopardize ALW standing include failure to maintain required staffing levels, inadequate documentation of resident care needs, and physical plant deficiencies.

• Licensing Probation: Application denied if the facility is on probation with CDSS CCLD.
• Pending Accusations: Application denied if there are pending disciplinary accusations against the licensee.
• Formatting Errors: Medi-Cal packets rejected for using staples, binders, sticky tabs, or correction tape.
• Missing Signatures: Packets rejected if lacking original wet signatures on DHCS 6204 forms.
• Incomplete Packets: Application closed if the provider fails to submit both the emailed program app and mailed Medi-Cal app.

11. Key Contacts and Resources

Providers must interact with multiple state divisions. CDSS CCLD handles all licensing inquiries, while DHCS handles waiver enrollment. DHCS maintains specific email addresses for different parts of the ALW application.

When mailing the Medi-Cal enrollment packet, providers must use the specific Integrated Systems of Care Division address, not the general Provider Enrollment Division address found on standard Medi-Cal forms.

• CDSS Senior Care Licensing: https://www.cdss.ca.gov/inforesources/senior-care-licensing
• DHCS ALW Program Info: https://www.dhcs.ca.gov/services/ltc/Pages/AssistedLivingWaiver.aspx
• Program Application Email: [email protected] (Provider and Facility Site Review Unit)
• Medi-Cal Packet Email: [email protected] (Provider Enrollment Unit for questions/revalidations)
• Medi-Cal Packet Mailing Address: DHCS, Integrated Systems of Care Division, Provider Enrollment Unit, 1501 Capitol Avenue, MS 4502, P.O. Box 997437, Sacramento, CA 95899-7437
• Title 22 Regulations: https://www.cdss.ca.gov/ord/entres/getinfo/pdf/rcfeman1.pdf

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