San Mateo County Grand Jury • 2006-2007

Issue | Background | Findings | Conclusions | Recommendations | Responses | Attachments Summary of Provision of

Published: March 05, 2007 33 pages

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⚠️ Translation Notice: This content has been automatically translated. The original English text is the official version. Translation may contain errors.

⚠️ Este contenido ha sido traducido automáticamente. El texto original en inglés es la versión oficial. La traducción puede contener errores.

Note: Missing finding numbers detected: F6, F7, F8, F9, F10, F11, F12, F13, F14, F15, F16, F17, F18, F19, F20, F21, F22, F23, F24, F25, F26, F27, F28, F29, F30, F31, F32, F33, F34, F35, F36, F37, F38, F39, F40, F41, F42, F43, F44, F45, F46, F47, F48, F49, F50, F51, F52, F53, F54, F55, F56, F57, F58, F59, F60, F61, F62, F63, F64, F65, F66, F67, F68, F69, F70, F71, F72, F73, F74, F75, F76, F77, F78, F79, F80, F81, F82, F83, F84, F85, F86, F87, F88, F89, F90, F91, F92, F93, F94, F95, F96, F97, F98, F99, F100, F101, F102, F103, F104, F105, F106, F107, F108, F109, F110, F111, F112, F113, F114, F115, F116, F117, F118, F119, F120, F121, F122, F123, F124, F125, F126, F127, F128, F129, F130, F131, F132, F133, F134, F135, F136, F137, F138, F139, F140, F141, F142, F143, F144, F145, F146, F147, F148, F149, F150, F151, F152, F153, F154, F155, F156, F157, F158, F159, F160, F161, F162, F163, F164, F165, F166, F167, F168, F169, F170, F171, F172, F173, F174, F175, F176, F177, F178, F179, F180, F181, 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Findings and Recommendations 6 findings

Decide prior to May 2008 what level of indigent health care San Mateo County can provide given the available funds and demands of other San Mateo County programs. Response: Concur. The County has been in the process of determining the cost of indigent healthcare services, and has hired the consulting firm of Health Management Associates (HMA) to review a financial analysis prepared by the Medical Center for its major service lines and payers. The County will use this information to develop the FY 2008-09 recommended budget for General Fund contributions related to (1) the County’s financial obligation under Section 17000 and (2) contributions in excess of the County’s Section 17000 mandate. The County will need to decide, as part of addressing its structural budget deficit, whether it will pay for a portion or all costs that exceed its Section 17000 obligation. The County is using HMA to help guide the decision making process by developing various options for the County to consider in determining the mix of services and payers that would create a financially viable system of care for indigent and uninsured residents. This work should be done in early 2008. It is anticipated that any decisions involving changes in the configuration of services or funding mix will be implemented over the course of several years.

Related Recommendations (1)

Review the funding for community health care initiatives and consider increasing contributions for direct indigent health care. District Response: This recommendation has been implemented. The PHCD Board reviews its community health care initiatives annually and strives to optimize both the amounts and the impact of its contributions. This past year, the Board’s review was augmented by a 10-month strategic planning process that resulted in its 2007-2010 Strategic Plan, which was approved at the August 23, 2007 regular Board Meeting. The process was facilitated by health care planning experts. Plan development was driven by data and findings from a number of recent community reports (E.g. Healthy Communities of San Mateo County, the Board of Supervisor’s Blue Ribbon Task Force, MPHS strategic planning data, LAFCo Report, etc.), as well as, Board Director participation on the Blue Ribbon Task Force, and input from the community-at-large through five Town Hall Meetings. The Board’s Vision, Mission, Values and Goals are summarized below and confirm our achievement of Recommendation 1. Our Vision: That all residents of the District live in an environment that contributes to optimal health through education, prevention, and access to needed health care services. Our Mission: We will preserve Peninsula Hospital, ensure that needed core services are maintained, support programs that share our vision, and do so in 3 collaboration with public and private service providers and the members of our community. Our Values: Stewardship, collaboration, inclusion, shared responsibility, and transparency. Our Goals: • Preserve Peninsula Hospital as a community asset. • Achieve measurable improvements in identified health problems • Improve availability of and access to health information and services for all residents in the District. • Ensure sufficient resources to achieve the Board’s vision, mission, strategic initiatives, and financial obligations. As further example of the Board’s work in funding community health initiatives it should be noted that the PHCD FY 07-08 grants budget was increased to $2 million and a new ad hoc Advisory Committee has been established to increase community input into the PHCD’s grant review process.

Work with the County Manager to communicate a shared vision and message to the public concerning San Mateo County’s policy on subsidized health care. Response: Concur. Before a vision on subsidized health care can be shared, the County must first have a clear understanding of what is currently being subsidized and at what cost. The County is mandated to provide health care for indigent residents under Section 17000 of the Welfare and Institutions Code. The cost to fund this mandate represents the “subsidy”, and any excess amount should be allocated at the Board’s discretion, either toward more health care services or toward other County programs and services. The County should not subsidize costs that can be funded by other payers, such as the state and federal government, and commercial payers. A shared vision on subsidized health care will be communicated as part of the January 2008 final recommendations from the Blue Ribbon Task Force on adult healthcare coverage, which will take into consideration the financial implications on existing County programs and General Fund contributions.

Related Recommendations (1)

Work with the San Mateo Medical Center to promote proactive, preventative health care initiatives to WELL Program participants and to the broader community. District Response: This recommendation has been implemented. The Peninsula Health Care District is geographically located in San Mateo County and has always collaborated with others who share the PHCD’s commitment to preventive health care. Board representatives have actively served, along with SMMC leadership, on committees and work groups focused on health issues of this community. In addition to the strategic plan goals delineated above and the activities that went into the development of that plan, the addition of a new Executive Director in May 2007 will extend the PHCD’s opportunity to actively participate in county-wide collaborative activities. COUNTY OF SAN MATEO Inter-Departmental Correspondence County Manager’s Office DATE: October 5, 2007 BOARD MEETING DATE: October 16, 2007 SPECIAL NOTICE: None VOTE REQUIRED: Majority TO: Honorable Board of Supervisors FROM: John L. Maltbie, County Manager SUBJECT: 2006-07 Grand Jury Response – Indigent Health Care Recommendation Accept this report containing the County’s responses to the following 2006-07 Grand Jury report: Provision of Indigent Health Care in San Mateo County. VISION ALIGNMENT: Commitment: Responsive, effective and collaborative government. Goal 20: Government decisions are based on careful consideration of future impact, rather than temporary relief or immediate gain. This activity contributes to the goal by ensuring that all Grand Jury findings and recommendations are thoroughly reviewed by the appropriate County departments and that, when appropriate, process improvements are made to improve the quality and efficiency of services provided to the public and other agencies.

Commission a formal legal opinion as to San Mateo County’s minimum legal requirements under California’s Welfare and Institutions Code Section 17000 to provide medical care to the indigent. Once such minimum legal requirements are ascertained, the Board of Supervisors can knowingly decide whether San Mateo County should satisfy only the legal minimum or whether and to what extent it should exceed it. Response: Agree. The County is currently in the process of revising its financial assistance policies for services provided by the San Mateo Medical Center. The Board approved the policies in December 2005. Subsequent changes in legislation, as well as identified improvements from the screening and verification pilot, need to be incorporated into the policies, which will be brought to the Board in December

Related Recommendations (1)

The Grand Jury recommends that the San Mateo County Board of Supervisors: Commission a formal legal opinion as to San Mateo County’s minimum legal requirement under California’s Welfare and Institution Code Section 17000 to provide medical care to the indigent. Once such minimum legal requirements are ascertained, the Board of Supervisors can knowingly decide whether San Mateo County should satisfy only the legal minimum or whether and to what extent it should exceed it.

Withhold implementation of any Blue Ribbon Task Force recommendation until the full financial implications, including impacts on other County programs, are well developed and understood. If any such recommendation is adopted, consideration should be given to its implementation initially as a pilot program so that no long-term commitment is made before its financial feasibility is established. Response: Agree. Prior to the completion of Blue Ribbon Task Force final

Related Recommendations (1)

The Grand Jury recommends that the San Mateo County Board of Supervisors: Withhold implementation of any Blue Ribbon Task Force recommendation until the full financial implications, including impacts on other County programs, are well developed and understood. If any such recommendation is adopted, consideration should be given to its implementation initially as a pilot program so that no long-term commitment is made before its financial feasibility is established.

Issue a request for proposal (RFP) by October 1, 2007, to review public health care services provided by San Mateo County with particular emphasis on indigent care. Qualified proposals should demonstrate a high level of experience and active involvement with indigent care models in California. The RFP should include but not be limited to the following tasks: (a) Ascertain the financial strengths and weaknesses of the San Mateo Medical Center, including identifying all cost efficiencies, sources of revenue and consideration of the impact that any proposed change would have on such revenue sources. (b) Identify the advantages and disadvantages of different payer or hybrid models as compared to San Mateo County’s provider health care system, including the fiscal, medical, and social effects of each. (c) Consider the impact of shortages of primary care physicians, nurses, dentists and specialist physicians amid increasing demand for medical services. (d) Estimate the number of uninsured and under-insured patients and plan for future increases in the cost of health care services for an aging population. (e) Review how other public agencies are delivering service and where true efficiencies can be obtained. (f) Determine how other communities have reduced costs and improved services, or at the very least, maintained a level of service. (g) Consider how current and evolving state health care initiatives may impact any San Mateo County proposal. (h) Consider the impact of health care issues that affect the whole San Mateo County community, such as the obesity epidemic, disparities in access to prenatal care, and a lack of access to preventative dental care. Response: Concur. On June 11, 2007, the County entered into Phase 1 of an agreement with Health Management Associates (HMA) for the purpose of reviewing the internal financial analysis conducted by the Medical Center on its major service lines and payers, and preparing five-year financial projections, assuming no changes to the configuration of services at SMMC. The County Manager and executive management of SMMC, Health Department, and Health Plan of San Mateo selected HMA after proposals were solicited and interviews were conducted with HMA and another consulting firm with healthcare expertise. HMA specializes in public hospitals and the uninsured population, and has recent experiences in San Francisco and Los Angeles counties that were more relevant to the complex issues facing the County. On September 25, 2007, the Board approved a contract amendment with Health Management Associates (HMA) for Phase 2 of the project. The firm will be interviewing and gathering information from County leadership, members of the Blue Ribbon Task Force on Adult Healthcare Coverage, County departments, other local hospitals and health care providers, community groups, physician groups, and others, and will develop various options for the County to consider in determining the mix of services and payers that would create a financially viable system of care for indigent and uninsured residents. Phase 2 should be completed in January 2008.

Related Recommendations (1)

The Grand Jury recommends that the San Mateo County Board of Supervisors: Issue a request for proposal (RFP) by October 1, 2007, to review public health care services provided by San Mateo County with particular emphasis on indigent care. Qualified proposals should demonstrate a high level of experience and active involvement with indigent care models in California. The RFP should include but not be limited to the following tasks: (a) Ascertain the financial strengths and weaknesses of the San Mateo Medical Center, including identifying all cost efficiencies, sources of revenue and consideration of the impact that any proposed change would have on such revenue sources. (b) Identify the advantages and disadvantages of different payer or hybrid models as compared to San Mateo County’s provider health care system, including the fiscal, medical, and social effects of each. (c) Consider the impact of shortages of primary care physicians, nurses, dentists and specialist physicians amid increasing demand for medical services. (d) Estimate the number of uninsured and under-insured patients and plan for future increases in the cost of health care services for an aging population. (e) Review how other public agencies are delivering service and where true efficiencies can be obtained. (f) Determine how other communities have reduced costs and improved services, or at the very least, maintained a level of service. (g) Consider how current and evolving state health care initiatives may impact any San Mateo County proposal. (h) Consider the impact of health care issues that affect the whole San Mateo County community, such as the obesity epidemic, disparities in access to prenatal care, and a lack of access to preventative dental care. The Grand Jury recommends that the Board of Trustees for the Sequoia Health Care District and the Peninsula Health Care District:

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County Counsel will be requested to provide a formal legal opinion on minimum legal requirements under Section 17000 of the Welfare and Institutions Code, which will be included in the policy revision process and presented to the Board in December.

No recommendations for this finding

Conclusions 3

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The County, as represented by the County Manager and the Board of Supervisors, is sending mixed messages with respect to providing indigent care. On one hand, the County Manager claims there is an imminent crisis and that the growing cost of providing indigent care will have significant negative effects on other County programs such as law enforcement and child welfare. On the other hand, the Board of Supervisors concurrently commissioned a study of the effects of increasing the scope of the County-subsidized indigent and charity care, which could result in increased health care costs to the County. The Board of Supervisors must be willing to entertain discussion of serious public policy issues such as who is eligible for subsidized care, what the breadth of that care should be, and what the consequences might be of providing or not providing broader coverage. There is no written legal opinion addressing the minimum legal requirements of Section 17000, rather the eligibility requirements established for the WELL Program remains the de facto standard used by the County. The Board of Supervisors needs to decide whether to restrict subsidized care to the legal minimum, leave it unchanged or further expand such coverage to a broader population with its attendant costs. The County currently estimates that it spends $40 million on “true” indigent care, yet its total contribution is $70 million which includes costs for charity care. The proposed adult coverage expansion will require an even greater contribution from the County General Fund, should it be adopted. Proposals for Reducing Costs for Indigent Care – SMMC Several suggestions have been made on how the County might reduce the costs for indigent care: (1) Improve revenue enhancement and cost reductions at the SMMC, and attempt to get private hospitals to carry more of the indigent burden. This is unlikely to produce significant cost reductions. The costs at the SMMC are already lower than at private hospitals in the County and public hospitals in the adjacent counties, and programs for more complete debt collection and closer scrutiny of eligibility for WELL Program benefits are underway. (2) Consolidate the health care districts into one countywide district so that the taxes currently collected by the districts can be used to offset indigent care costs. Apart from legal and practical considerations, this is unlikely to provide much relief as charity and other services currently provided by the districts would have to be assumed by the County. (3) Sell, lease or donate the SMMC hospital facility to a private entity and have the County reimburse the operator for indigent and charity care. This presumes that a buyer, a lessee or a recipient could be found, which may be problematic given the perceived stigma associated with a county hospital, the underutilization by paying patients, and other negative factors such as inadequate parking.
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(4) Close the SMMC and contract with private hospitals for indigent patient care. Complete closure of the SMMC with its clinics, long-term care, psychiatric facilities, and other programs would leave a gap in health care coverage in the County. It is not clear to the Grand Jury how this proposal would reduce costs. (5) Discontinue some services currently provided by the SMMC and consolidate some of the off-campus clinics in the vacated space. One proposal is to close the inpatient medical/surgical/ICU facilities, replace the emergency unit with urgent care, and consolidate all long-term care onto one campus. Inpatient care for the WELL Program participants could be provided by private hospitals through enrollment with a third party provider, such as the Health Plan of San Mateo. There are many variations of this particular option when factors such as a possible expansion of psychiatric care at the SMMC and the consolidation of services at the Burlingame Long-Term Center, are included in the mix. The Grand Jury believes that some variation of this option may constrain costs yet provide acceptable levels of indigent and charity care within the County. A common feature of the payer models is that cost savings are realized not through reduced costs for WELL Program participants, whose care would likely cost more at private hospitals, but rather by the avoidance of losses caused by inadequate revenue from public sources, charity care and bad debt. In private hospitals, such costs are offset by insured, paying patients. The Board of Supervisors must seriously consider alternative models and decide whether it wishes to maintain the existing model with its growing deficits or transition into a mix of payer and provider models. Once that initial decision is made, then the different payer alternatives can be assessed for their effects on the overall provision of health care services financed by the County. A better understanding of the SMMC finances is needed before an informed decision can be made. The results of a study to be undertaken by the SMMC and the County Manager’s Office are due prior to the 2008-2009 budget discussions. This study should shed light on the true costs of differentiated services at the SMMC, and provide the data essential to perform an informed cost-benefit analysis addressing the options for continued operation or possible, sale, lease, outsourcing or other disposal of the SMMC departments or services. The County needs and deserves more than “back of the envelope” calculations to substantiate any recommended change in status. Health Care Districts Both SHD and PHD participate in numerous health initiatives in the County. In the combined 2006-2007 budgets of both districts, approximately $9.7 million is allocated for community health programs and contributions. Should a significant amount of these funds be redirected to pay for county-mandated indigent care, many local wellness and prevention programs for district residents that help limit costs might lose funding.
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The districts are moving forward to build hospitals that meet seismic standards and substantial commitments of reserve funds have been made for these projects. Existing contractual relationships between both districts and third parties provide major obstacles to any organizational change. SHD and PHD are members of the current Task Force and should be encouraged to continue to engage in countywide forums and to find ways in which each district can make a meaningful contribution to the treatment of the medically indigent. Blue Ribbon Task Force The goal of this Task Force was to provide one or more recommendations to the Board of Supervisors by July 2007. That deadline has recently been extended to December 2007. The Task Force is moving forward with a proposal to establish an eligibility ceiling for adult medical coverage at 400% of the FPL – an expansion over the 200% of the FPL WELL Program eligibility cap. The cost of this proposal, currently estimated at $165 million, remains one of the fundamental hurdles to its implementation. The Task Force has estimated that the SMMC currently receives $48 million under federal and state medical reimbursement plans. Caution is needed to ensure that any provider-to-payer model change proposed for the future operation of the SMMC will not reduce this estimated $48 million. Any negative impact on these funding sources will likely increase the County’s contribution to any proposed coverage plan. Assuming the entire $48 million funds remain, the Task Force concludes that the total cost for providing the 400% of the FPL target population will be $117 million. Of the $117 million, the Task Force assumed that if the $35 million County contribution to the WELL Program and the three-year State grant of $7.5 million annually were taken into account, the additional revenue required to fund this coverage model would be reduced to $74.5 million, which is still more money than the County has budgeted for indigent care.

No Responses Found 2

Government entities assigned to respond to this report. No response documents have been linked in our database.

Peninsula Health Care District Special District

San Mateo County Board of Supervisors Elected County Office