COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Health Services Agency

 

DATE:

July 3, 2003

BOARD MEETING DATE:

August 5, 2003

 

TO:

Honorable Board of Supervisors

FROM:

Margaret Taylor, Director of Health Services

 

SUBJECT:

Amendment to the agreement with Diamond Drugs, Inc., dba Diamond Pharmacy Services

 

Recommendation

Adopt a resolution executing an amendment to the agreement with Diamond Drugs, Inc., dba Diamond Pharmacy Services.

 

Background

On December 18, 2001, your Board approved an agreement with Diamond Pharmacy Services to provide professional comprehensive pharmaceutical services for all prescription, non-prescription, and intravenous solutions as ordered by Correctional Health and Mobile Van physicians and dentists, including, but not limited to, medications for topical, oral, IV and injectable use, inhalers, suppositories, and AIDS Drug Assistance Program (ADAP) medications. The total amount of the agreement is $885,000 for a two-year term from January 1, 2001 through December 31, 2003 with the option to renew the agreement for one additional year at the County's sole discretion.

 

Diamond Pharmacy Services was selected to provide these services through a competitive RFP process conducted by the Health Services Agency in July 2001. An RFP was developed and advertised, resulting in three parties competing for the pharmacy contract. Diamond Pharmacy Services was chosen by the RFP review committee and awarded the contract for pharmaceutical services.

 

Discussion

Within the past two years, there has been an increased need for medication at the jails, Juvenile Hall and on the Mobile Clinic due to an increase in the number and medical severity of clients served. There has been a major change in prescribing patterns and costs of psychotropic drugs, oral diabetic medications and antibiotics for Correctional Health clients within the past few years. Many new inmates are already taking these medications at the time they are booked into the jail. It is frequently not possible for the medical staff to change these medications because it is not safe to change to a different drug and there may not be any generic equivalents. The result is the continued treatment with the more expensive medication is required. In addition, the Mobile Clinic is serving an increased number of homeless clients who typically require costly medications.

 

This amendment to the agreement with Diamond Pharmacy Services extends the term of the agreement for an additional year, through December 31, 2004, and increases the total amount of the agreement by $1,020,000 to cover the cost of needed pharmaceuticals for Correctional Health and Mobile Clinic clients.

 

The Health Services Agency will conduct an RFP for pharmaceutical services for Correctional Health and the Mobile Health Clinic during the next year.

 

Vision Alignment

The amendment to the agreement with Diamond Pharmacy Services keeps the commitment of Ensuring 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 amendment to the agreement contributes to this commitment and goal by providing pharmaceutical services to clients of Correctional Health and the Mobile Clinic.

 

Fiscal Impact

The amendment increases the contract by one year, to expire December 31, 2004. The increase in the total cost of the contract is $1,020,000, increasing the total contract to $1,905,000. That amount increases the expenditures for the original term by $230,000 to reflect the increase in the trend of expenditures due to the increase in medical severity of the clients. The new total for July 1-December 31, 2003 is $324,000. The cost of the additional year is $790,000. $379,000 is for January 1, 2004 - June 30, 2004 and $411,000 is for July 1, 2004 - December 31, 2004.

 

The contract total is increased to $1,905,000. $797,000 was spent through June 30, 2003. $697,000 is planned for 2003-04 ($660,000 in Correctional Health and $37,000 in Public Health) and is in the approved budget for this year. $411,000 is planned for 2004-05 ($390,000 for Correctional Health and $21,000 for Public Health) and will is included in the 2004-05 budget.

 

The total cost for Public Health is $109,078; it is covered by grant funding and there is no net county cost. The cost for Correctional Health is $1,795,922; it is not covered by outside funding and the total is the net county cost.