COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Department of Hospital and Clinics

 

DATE:

May 31, 2002

   

BOARD MEETING DATE:

June 18, 2002

   
 

TO:

Honorable Board of Supervisors

   

FROM:

Nancy Steiger, Chief Executive Officer

 

SUBJECT:

Amendments (2001-3, 2002-1, 2002-2) to the Agreement with the San Mateo Health Commission

 

Recommendation

Adopt a resolution authorizing the President of the Board to execute amendments (2001-3, 2002-1, and 2002-2) to the agreement with the San Mateo Health Commission.

 

Background

On January 11, 1994, your Board approved an agreement with the San Mateo Health Commission for San Mateo County General Hospital (SMCGH) to serve as a participating hospital in the Health Plan of San Mateo (HPSM), the Medi-Cal capitated program. All San Mateo County Medi-Cal patients are automatically enrolled in the HPSM and are assigned to hospital affiliated primary care providers. The term of the agreement was one year, from December 1, 1993 through November 30, 1994.

On December 19, 1995, your Board approved five amendments to the agreement (94-1, 94-2, 94-3, 95-1, and 95-2) which: 1) updated Exhibit B and deleted mental health services from the Health Plan's contract with the State; 2) extended the term through November 30, 1995; 3) increased per diem payments and outpatient reimbursement; and redefined the term "Special Member Pediatric Day."

Honorable Board of Supervisors

Amendments 2001-3, 2002-1, 2002-2/San Mateo Health Commission
Page 2

On January 28, 1997, your Board approved three amendments to the agreement (95-3, 96-1, and 96-2) which: 1) revised Exhibit B for the 1995 term; 2) extended the term through November 30, 1996; 3) reduced the percentage of withhold from 15% to 10% and adjusted the capitation allocation rates; 4) increased provider rates for one year effective June 1, 1996; and 5) extended the term through November 30, 1997, and added Full Capitation Allocations to the Health Plan's approved budget.

On February 10, 1998, your Board approved amendment 97-1which extended the term one year, through November 30, 1998 and replaced Exhibit B which contains the full capitation allocations.

On November 17, 1998, your Board approved Amendment 98-1which: 1) increased the hospital per diem rates by 10% and increased the outpatient rate by 5% (or 33% above the Medi-Cal rates) for services provided on or after July 1, 1998; and 2) included a revised schedule of capitation allocations reflecting the increase in rates.

On February 23, 1999, your Board approved Amendment 98-2 which extended the term of the agreement another year, through November 30, 1999 and replaced Exhibit B (Full Capitation Allocations which reflected adjustments to various categories, none of which is more or less than 1%).

On February 8, 2000, your Board approved Amendment 99-1which extended the term of the agreement through November 30, 2000.

On April 25, 2000, your Board approved Amendment 2000-1 which increased Hospital Inpatient and Outpatient rates by 5% and increased physician rates and hospital outpatient rates from 33% to 38% above Med-Cal rates at a minimum.

On March 27, 2001, your Board approved Amendments 2000-2 which extended the term of the agreement another year, through November 30, 2001 effective December 1, 2000 and Amendment 2001-1 which increased Hospital Inpatient and Outpatient rates by 5% effective February 1, 2001. This amendment included a revised Exhibit 3 reflecting the increase in rates.

On October 23, 2001, your Board approved Amendment 2001-2 which increased the per diem levels for an Acute Care Day to $1,302 effective for admissions on or after June 1, 2001. This Amendment also increased the rates for the above days to $1,502 for admissions on July 1, 2001 through October 31, 2001. The rates for Critical Care Days increased to $1,775 for July 1, 2001 through October 31, 2001. For admissions on or after November 1, 2001, the per diem rates returned to the pre-July 1, 2001 levels: $1,302 and $1,575

Honorable Board of Supervisors
Amendments 2001-3, 2002-1, 2002-2/San Mateo Health Commission
Page 3


respectively. In addition to the per diem changes, this amendment also revised Exhibit 3 to increase the inpatient allocations to reflect the per diem increases.

 

Discussion

Starting with Amendment 2001-3, "San Mateo County General Hospital, hereinafter referred to as HOSPITAL" will be amended to read "San Mateo County dba San Mateo County Health Center, hereinafter referred to as HOSPITAL".

Amendment 2001-3 strikes "November 30, 2001 in Article X and inserts "December 31, 2001". This change allows reimbursement for covered services for members in the month of December 2001. Amendment 2002-1 extends the term of the contract through December 31, 2002. Amendment 2002-2 deletes language in A(1) regarding coverage by Health Plan of San Mateo (HPSM) of undocumented individuals and deletes all of A(6), deletes the OBRA aid codes in Exhibit 3A, and adjusts the annual allocations to reflect the utilization and reimbursement provisions in the budget for this calendar year.

 

Vision Alignment

This agreement with San Mateo County Health Commission keeps the commitment of Ensuring Basic Health and Safety for All and goal number 5: Residents have access to healthcare and preventive care. The agreement contributes to this commitment and goal by providing a mechanism to pay for Medi-Cal reimbursable hospital and medical services provided to San Mateo County Medi-Cal recipients at San Mateo County General Hospital.

 

Fiscal Impact

The elimination of coverage by the HPSM for certain undocumented individuals (known as OBRA-linked clients who only qualify for Medi-Cal because they are receiving emergency services or are pregnant), effective February 1, 2002, will have a substantial financial impact on SMCHC. While reimbursement for these services will now be available directly from the State, more service denials are anticipated since the State's eligibility guidelines for OBRA inpatient services are much stricter than the Health Plan's have been. The best estimate at this time is that these denials will cause a $1.4 million annual decrease in Medi-Cal reimbursement for the Health Center.