California Code, Welfare and Institutions Code - WIC § 5912

(a) As long as contracts require institutions for mental disease to continue to be licensed and certified as skilled nursing facilities by the State Department of Public Health, they shall be reimbursed for basic services at the rate established by the State Department of Health Care Services.  Effective July 1, 2014, the reimbursement rate for institutions for mental disease shall increase by 3.5 percent annually.

(b) It is the intent of the Legislature that the annual rate increases provided in subdivision (a) be utilized by the institutions for mental disease to meet direct service costs and, to the extent possible, improve the quality of care rendered to residents in the facilities.

(c) Notwithstanding subdivision (a), beginning July 1, 2017, in any year that the Mental Health Subaccount of the Local Revenue Fund does not receive full vehicle license fee growth funds from the General Growth Subaccount in the Vehicle License Fee Growth Account pursuant to Section 17604 and subdivisions (a) and (b) of Section 17606.20, the reimbursement rate for services in institutions for mental disease that are licensed and certified as skilled nursing facilities shall be the same as the rates in effect in the prior year.