COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Health Services Agency

DATE:

May 1, 2002

BOARD MEETING DATE:

May 21, 2002

TO:

Honorable Board of Supervisors

FROM:

Margaret Taylor, Director of Health Services

Gale Bataille, Director of Mental Health Services

SUBJECT:

Amendment to Agreement with Telecare Corporation

Recommendation

Adopt a resolution authorizing the President of the Board to:

1. Execute an amendment to the existing agreement with Telecare Corporation to add a FY 2001-02 COLA increase, change the levels of psychiatric treatment services provided at the Cordilleras Mental Health Center, refurbish the Cordilleras Willow Suites, fund a medical director position, eliminate use of Garfield NeuroBehavioral Center in FY 2002-03, and increase bed rates at Gladman Psychiatric Health Facility.

2. Authorize the Director of Health Services to execute amendments and minor modifications to this agreement not to exceed the aggregate of $25,000.

Background

In January 1999, your Board approved an agreement with Telecare Corporation to provide inpatient psychiatric treatment services for San Mateo County residents at three locations: San Mateo County's Cordilleras Mental Health Center in Redwood City, and Garfield NeuroBehavioral Center and Gladman Psychiatric Health Facility, both located in Alameda County. Telecare has operated Cordilleras Center since 1982.

Discussion

In 1998 Telecare was awarded a 5-year agreement with a 2.74% annual COLA. This COLA would not cover the projected salary increases for FY 2001-02. Energy costs have also increased sharply from an average of $7,000 to $18,000 per month. During the FY 2001-02 budget hearings your Board requested and later received a report on the Telecare agreement and the impact of amending the agreement to pay for increases in the salaries and benefits of employees at Cordilleras Center. Your Board recommended that the Division increase the annual built-in COLA of 2.74% (an increase of $134,345) to 5.89% ($288,904) for FY 2001-02 in order to cover those staff salary and energy cost increases.

The third floor of the Cordilleras facility is licensed by the State Department of Mental Health as a Mental Health Rehabilitation Center (MHRC) to provides seventy (70) locked sub-acute treatment beds for seriously mentally ill individuals. The MHRC program serves primarily San Mateo County residents but reserves a limited number of beds for the Veterans Administration and other counties. Community Care Licensing licenses the first and second floors of Cordilleras Center as residential care for sixty-nine (69) San Mateo County clients.

Under the amended agreement, Cordilleras shall operate the second floor program, the Willow Suites, as a 20-bed residential care unit to treat individuals with personality disorders who do not do well in locked settings and are often high users of acute inpatient and psychiatric emergency services. An "Assertive Community Treatment" (ACT) team will compliment the residential staff of the Willow Suites and provide intensive case management services to the clients of this program. The amended agreement includes funding for the refurbishing of the Willow Suites.

The recently retired Chief of Psychiatry at San Mateo County General Hospital served as Medical Director for Cordilleras until February 2002. The amended agreement contains funding and a scope of work for a new Medical Director's position to be hired by Telecare.

The proposed amendment also eliminates the use of seven beds at Garfield Neurobehavioral Center in FY 2002-03 reducing contract payments by $392,263. The proposed amendment increases the daily bed rate at Gladman from $241.84 to $261.00, increasing compensation by $32,422, from $257,753 to $290,175. Additionally, the invoicing procedure for the tuberculosis treatment services at Cordilleras will be limited to one (1) bed. The contractor shall invoice Public Health on a quarterly basis based on a negotiated net amount for those services.

County Counsel and Risk Management have both reviewed and approved the agreement. This amendment has been delayed due to the need to resolve multiple changes to the agreement, in addition to the necessity for a hearing before your board last fall regarding the COLA.

We expect to bring a subsequent amendment to this agreement to your board next fall for FY 2002-03 following approval of next year's budget.

Vision Alignment

This agreement keeps the commitment to Ensure Basic Health and Safety for All and goal number 8: Help vulnerable people-the aged, disabled, mentally ill, at risk youth, and others- achieve a better quality of life. The agreement contributes to this commitment by providing rehabilitation services to seriously mentally ill San Mateo County residents.

Fiscal Impact

The term of this agreement remains July 1, 1998 through June 30, 2003. The proposed amendment includes an additional $283,878 for FY 2001-02, which will be covered by the Mental Health Services Division FY 2001-02 budget. This comprises the additional $154,559 COLA (3.19%), $32,422 for the Gladman bed rate increase, $17,000 for the Medical Director, and $79,897 for refurbishing the Willow Suites. This increase is offset by the reduction of utilization of seven beds at Garfield, resulting in a decrease in cost of $392,263. The amended net maximum compensation for the five-year agreement is $33,011,869.

We are also requesting that the Director of Health Services be given signing authority to execute minor amendments and adjustments up to an aggregate of $25,000.