Orange County is renewing its effort to sever ties with a mental health nonprofit, Mind OC, saying in a court filing Tuesday the organization has overbilled for rent at the Be Well mental health center in Orange and that it benefited by fraudulently working with the office of disgraced former Supervisor Andrew Do.
“Mind OC … took positions designed to maximize its profits at the expense of county taxpayers and residents in dire need of affordable mental health services,” county spokesperson Molly Nichelson said in a prepared statement.
“The county seeks … to promote accountability and equitable stewardship of taxpayer resources. It also seeks to ensure that county health care facilities and public funds are used to provide critical, affordable and cost-effective behavioral health care services to county residents, rather than to enrich Mind OC, a private party.”
Officials at Mind OC, which develops mental health centers under the name Be Well Orange County, deny the allegations, which were initially made in a lawsuit filed in late 2024 and spelled out again in the new cross-complaint filed in Orange County Superior Court and made public Tuesday.
Leaders of the nonprofit said they’ve now successfully developed two mental health campuses, in partnership with the county, and that they’ve used industry-standard practices in setting rents and in other aspects of working with mental health providers.
Mind OC officials also noted that the county’s latest complaint comes just as a second Be Well campus, with 154 beds, is slated to open adjacent to the Great Park in Irvine. Nonprofit leaders said they’ve spent years on the Irvine project, raising money from donors and working with local officials and residents to establish the Be Well brand as a strong member of the community.
If they’re removed from that project, they note, the county stands to reap those efforts.
“Be Well OC has received the county’s cross-complaint and is reviewing it carefully. We are not surprised by this filing, it arrived today, the county’s legal deadline, and only after Be Well initiated its own lawsuit against the county for breaches of the ground lease at the Be Well Orange campus and the significant damages those breaches caused,” Mind OC attorney Jeff Singletary wrote in a prepared statement.
“The timing is telling and it is reactionary. The Management Services Agreement (MSA) at the center of the county’s claims was terminated a long time ago. The county’s decision to raise these allegations now, for the first time, in a cross-complaint, speaks for itself.”
The county’s charges against Mind OC range from fraud to breaking federal health privacy laws. Specifically, the county says Mind OC violated at least 38 terms of its operating agreement at the 90-plus-bed Be Well campus in Orange, and that it set rents — paid by the county — that generated a “windfall of excess profits,” worth more than $6.5 million.
The county also repeated a claim made in late 2024, that Mind OC signed a $275,000 contract with a company owned by the wife of the chief of staff for Do, who is serving a 60-month sentence after pleading guilty to federal charges of misusing more than $10 million in public money.
Though the Do-connected subcontractor never delivered on that contract, and Mind OC repaid the $275,000, the county claims the nonprofit fraudulently benefited from working with Do, saying that in 2022 the former supervisor pressured county Health Agency officials to give Mind OC a bigger role at the Be Well campus in Orange.
The dispute between the county and Mind OC appears to have ended, or at least dramatically altered, a once-touted effort to create a chain of open-access mental health campuses across the county.
Once, the idea was that a public/private group would develop centers that would be available for anyone who needs treatment for mental health issues or substance abuse or some combination of the two. The idea was that by reducing mental health substance abuse problems, issues such as homelessness might be abated.
Instead, the one campus that’s operating, the Be Well center in Orange that opened in 2021, treats only patients insured by Medi-Cal, known in Orange County as CalOptima. That means people covered by other insurers must find mental health treatment elsewhere, a prospect that’s difficult in a county that, by most accounts, is woefully underserved to meet a fast-growing need for mental health care.
Mind OC officials said they want to expand operations so the Be Well centers can accept anybody who needs help.