Substance use disorder: certified programs and licensed facilities.

Senator Umberg's substance use disorder treatment legislation establishes new oversight requirements for California treatment programs and creates the state's first licensing system for patient referral agencies. The bill requires certified programs and licensed facilities to submit annual reports detailing all financial transactions with recovery residences, starting July 2026.

The legislation prohibits any person or organization from referring individuals to substance use disorder treatment programs for payment without first obtaining a license from the Department of Health Care Services. License applicants must demonstrate they have no direct or indirect financial interests in treatment facilities they refer to, submit detailed ownership information, and provide their fee schedules. The department may suspend or revoke licenses for violations and impose civil penalties equal to any illegally received referral payments.

Local public agencies providing free referral services retain their existing authority to connect individuals with treatment programs. The department gains authority to refer complaints about recovery residences to state and federal enforcement agencies, including the Department of Insurance and Attorney General's office. Civil penalties collected through enforcement will fund the administration of the new licensing program.