If you’re in — or thinking about joining — California’s Self-Determination Program (SDP) through your regional center, one piece of the setup isn’t optional: a Financial Management Services (FMS) provider. Every SDP participant has to use one. In a program built around cutting out red tape, FMS is the one vendor requirement that’s left.
This article explains what an FMS provider actually does, the three ways you can structure that relationship, who pays for it now (the answer changed in 2022), current rates, and where to find one near you.
Financial Management Services, at a glance
- Required for everyone in SDP. No exceptions.
- Three models: Bill Payer, Co-Employer, Sole Employer.
- Paid by your regional center since July 1, 2022 — not your budget.
- Rates are capped by DDS, from $230–$925/month.
What Financial Management Services Actually Do
By law, “financial management services” means the services and functions that help you manage and direct the money in your individual budget, and make sure you have the funds to carry out your Individual Program Plan (IPP) all year. That covers paying bills, and, if you employ your own support staff, running payroll, withholding taxes, and following state and federal employment law. [Welf. & Inst. Code § 4685.8(c)(1)]
In practice, your FMS provider is the entity that:
- Manages your individual budget and pays for the services and supports in your spending plan
- Runs payroll and withholds taxes if you’re employing workers directly
- Helps verify that a provider is qualified to deliver the service you’ve chosen
- Arranges or verifies criminal background checks for anyone providing you direct personal care
- Sends you and your regional center service coordinator a monthly statement of what’s been spent and what’s left
Every SDP participant must use a vendored FMS provider of their own choosing. [Welf. & Inst. Code § 4685.8(d)(3)(E)] It’s also the only piece of the puzzle that has to go through regional-center vendorization at all — every other provider you hire in SDP just has to stay off the federal debarment list and hold whatever license or certification the service normally requires. [Welf. & Inst. Code § 4685.8(t)]
The Three FMS Models
There isn’t one flavor of FMS — there are three, and which one applies depends on how you’re arranging a given service. You can use more than one model at the same time: for example, an FMS might act as Bill Payer for a communication device you’re purchasing, while also supporting you as a Co-Employer for a job coach you’ve hired.
Bill Payer (also called the Fiscal Agent model)
Used when you’re buying goods or services from a business — therapy sessions, a communication device, adaptive equipment. No employer-employee relationship exists between you, the FMS, or the business. The FMS simply pays the invoice; the business remains responsible for its own workers, taxes, and insurance.
Participant and FMS as Co-Employer
Used when you want to hire your own support staff but share the employer responsibilities. The FMS is the employer of record and handles payroll, taxes, and insurance; you keep the authority to recruit, interview, and recommend who gets hired and fired, and you supervise the day-to-day work.
Participant as Sole Employer (also called the Fiscal/Employer Agent)
Used when you want to be the direct employer yourself. You hire and fire independently; the FMS processes payroll and helps you stay compliant with employment law, but you’re the one who obtains your own tax reporting number, workers’ compensation, and liability insurance.
Bill Payer
- Employer
- The business you're paying — not you, not the FMS
- Best for
- Buying goods or services from a business
- Payroll?
- None — no employees involved
Co-Employer
- Employer
- You and the FMS, together
- Best for
- Hiring staff while sharing paperwork and liability
- Payroll?
- FMS runs it; FMS carries workers' comp
Sole Employer
- Employer
- You, directly
- Best for
- Full control over the employment relationship
- Payroll?
- FMS processes it; you hold the insurance
Who Pays for FMS — and What Changed in 2022
Through June 30, 2022, the cost of your FMS provider came out of your own individual budget, capped at a maximum monthly rate DDS published. That changed with the 2022 developmental-services trailer bill, SB 188 (Stats. 2022, ch. 49), which amended Welfare and Institutions Code § 4685.8(c)(1) to remove that requirement. Effective July 1, 2022, the regional center pays the FMS provider’s monthly fee directly, outside of your individual budget — and DDS directed regional centers to help participants already enrolled at the time adjust their spending plans to use the budget room that freed up.
Worth knowing: If anyone tells you your FMS fee comes out of your individual budget, that hasn’t been true since July 1, 2022. Ask your service coordinator to confirm the regional center is paying it directly.
Flag: The 2022 change only moved the FMS provider's own monthly fee. Under Co-Employer and Sole Employer, employer burden — FICA, FUTA, SUTA, the Employment Training Tax, workers' comp, and paid sick leave — is still charged against your spending plan. Ask your FMS for their current DDS-approved Employer Burden form.
What an FMS Provider Is Required to Do
Every vendored FMS provider in SDP is bound by the same baseline obligations. An FMS provider must:
- Be vendored by a regional center — the only SDP service that regional-center vendorization applies to at all
- Meet Title 17, California Code of Regulations §§58884, 58886, and 58887
- Bill and get paid by the regional center on at least a semi-monthly schedule
- Spend only on what’s listed in your individual program plan (IPP), individual budget, and spending plan
- Send you and your service coordinator a monthly statement: funds by category, what was spent in the last 30 days, and what’s left
- Verify that anyone giving you direct personal care has passed a criminal background check
- Check that a provider isn’t on the federal OIG exclusion list or the DHCS Medi-Cal suspended/ineligible provider list
- Confirm that services are delivered in settings that meet federal Home and Community-Based Services requirements
One requirement was recently dropped: FMS providers no longer have to post a surety bond with the vendoring regional center, effective May 1, 2024. And as of April 22, 2025, any new entity applying to become an SDP FMS provider must clear three additional preliminary screens — confirming it isn’t on any state or federal ineligibility list, documenting minimum staff qualifications, and demonstrating initial fiscal solvency — before the regional center will process its vendor application. That additional screening does not apply to FMS providers already vendored before that date.
An FMS provider must…
- Be vendored by a regional center
- Meet Title 17, CCR §§58884, 58886, 58887
- Bill the regional center at least semi-monthly
- Spend only what's in your IPP and spending plan
- Send a monthly budget statement to you and your service coordinator
- Verify background checks for direct personal care staff
- Check federal OIG and DHCS exclusion lists
- Confirm HCBS settings compliance
Current FMS Monthly Rates
An FMS may not charge more than the maximum monthly rate DDS publishes. The rate depends on the FMS model, how many employees and providers appear in your spending plan, and whether your preferred language is English.
Preferred language: English
Preferred language: not English
Flag: DDS raised rates for a similar but separate program, Participant-Directed Services, to $160 and $265 per month effective January 1, 2025 — explicitly not for SDP. If a quoted rate doesn't match the SDP table above, ask which program it's actually for.
One more note on sourcing: DDS’s own FMS Models Comparison Chart, still linked from the department’s FMS contact page, was last updated April 27, 2021 and still states that FMS costs come out of the individual budget. That line is outdated — rely on the July 2022 directive and the section above for the payment question, and on the comparison chart only for how tasks divide between you and your FMS.
How FMS Fits Into Enrolling in SDP
- Complete SDP Orientation. As of April 1, 2026, this is a required two-part course, two hours per part, offered online only through the State Council on Developmental Disabilities (SCDD). Part B covers financial management service vendors and models directly.
- Person-centered planning. You and your planning team update your Individual Program Plan (IPP) to reflect what self-determination will look like for you.
- Regional center certifies your individual budget. Based on your last 12 months of purchase-of-service spending, with adjustments the IPP team documents in writing.
- Choose your FMS model and provider. Bill Payer, Co-Employer, or Sole Employer — or a mix, if you’re buying goods and employing workers at the same time. Talk to more than one vendored FMS before you decide.
- Build your spending plan. Your FMS helps you attach a spending plan to your IPP that lists the cost of every good, service, and support your budget will cover.
- Enroll and start services. The FMS begins managing payments and, if you’re a Co-Employer or Sole Employer, payroll.
Finding an FMS Provider
Your regional center can tell you which vendored FMS providers serve your area, and DDS keeps a statewide contact list you can filter by regional center, including which languages and which of the three models each provider offers. It’s worth talking with more than one before you decide — not every FMS supports every model, and fees, responsiveness, and language support vary. If the fit isn’t right, you can change FMS providers without leaving SDP.
Ready to find a vendored FMS provider?
DDS keeps a statewide directory you can filter by regional center, model, and language.
What's Still Changing
FMS is one of the more actively revised corners of SDP. DDS tightened vendorization standards for new FMS entities in April 2025, and materials presented to the Statewide Self-Determination Advisory Committee in May 2026 list “SDP Financial Management Service Vendor Standards” among the department’s current areas of focus — meaning further changes to how FMS providers are vetted, and possibly to rates or reporting, are still being worked out. Check with your regional center or DDS’s SDP program directives page before assuming anything on this page is the last word.
About This Article
IHSS Connect publishes this article for general information and education. It is not legal advice, and reading it does not create an attorney–client relationship. IHSS Connect is not a law firm and is not affiliated with the Department of Developmental Services, any regional center, or any FMS provider.
Program rules, rates, and directives change — sometimes without a new law behind them, since DDS can issue program directives ahead of formal regulations. Only your regional center can decide what you’re eligible for, and only DDS can answer questions about statewide FMS policy.
If a decision on your case looks wrong, or you want advice about your own situation, talk to someone who can look at your file:
- Free and low-cost legal help: LawHelpCA.org
- DDS Self-Determination Program Branch: sdp@dds.ca.gov · (833) 421-0061
- Office of Clients’ Rights Advocacy (Disability Rights California): 1-800-390-7032
Figures reflect Self-Determination Program rules and rates in effect as of September 2026. Verified September 2026.
Sources
- Welfare and Institutions Code § 4685.8FMS definition, payment, and vendorization scope
- DDS: Financial Management Services directive (Dec. 2018)Three FMS models and provider requirements
- DDS: Regional Center Payment of FMS (July 2022)SB 188 payment change
- DDS: Employer Burden guidance (April 2024)What still comes out of your spending plan
- DDS: FMS requirements update (April 2024)Surety bond requirement removed
- DDS: New FMS vendorization screening (April 2025)Added requirements for new FMS entities
- DDS: SDP FMS Monthly Rates (12/1/2023)Current maximum rate table
- DDS: New FMS Rates (Jan. 2025)Confirms 2025 increase excludes SDP
- DDS: FMS Contact ListLive directory of vendored FMS providers
- DDS: FMS Models Comparison Chart (2021)Task division by model
- DDS: SDP Orientation Updated (March 2026)Two-part orientation via SCDD
The Department of Developmental Services is the primary authority throughout this article. Where a regional center's own materials differ from a current DDS directive or the statute, the directive and statute govern.
