It is the intent of the Legislature that the department conduct a pilot program, of not less than three years’ duration, to comprehensively assess the comparative cost effectiveness and quality of care of both contract and individual provider modes of service.

The pilot project will test alternative methods to maximize delivery of services under this article within budget appropriations. The project may also investigate the feasibility of the “capitation” method of payment in any or all of the counties participating in the project. County participation shall be on a voluntary basis.

The department shall have the authority, if necessary, to reallocate available funds as necessary to ensure the success of the project within the overall state budget.

The director may issue waivers, as necessary, pursuant to Section 18204.