California Code, Welfare and Institutions Code - WIC § 14124.83

(a) The agreement shall stipulate when the contractor may identify, quantify, or recover amounts owing by third parties that may be subject to a claim for reimbursement.

(b) Payment to the contractor shall be based upon a no cost percentage of recovery formula, which shall not exceed 25 percent of the gross recovery upon the claim. It is the intent of the Legislature that “no cost” include all considerations for court costs, legal fees, and the universe of the case processing activity, not including, however, departmental processing.

(c) Payment for amounts determined to be owed to the state by third parties and carriers shall be made directly to the state.

(d) A bond in the amount required by the state for collection agencies shall be sufficient.

(e) Contractor's files shall be subject to audit, pursuant to the contract, but shall remain the property of the contractor. At the request of the department, the contractor shall provide copies of any claims related to a particular recovery.

(f) The contractor shall report periodically to the department concerning its progress in the discovery of cases and the recovery of amounts subject to claim, and shall provide other information as the department may require, and at a reasonable frequency, to adequately monitor the progress of the contractor.