COUNTY OF SAN MATEO

Inter-Departmental Correspondence

San Mateo Medical Center

DATE:

August 9, 2004

BOARD MEETING DATE:

August 31, 2004

TO:

Honorable Board of Supervisors

FROM:

Nancy Steiger, Chief Executive Officer

SUBJECT:

Amendment 2004-1 to the Agreement with the San Mateo Health

Commission (HPSM)

Recommendation

Adopt a resolution authorizing the President of the Board to execute

Amendment 2004-1 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), now San Mateo Medical Center, to serve as a participating hospital in 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.

Collectively, your Board approved 23 more amendments after 1995. These amendments revised fee schedules, adjusted allocations, updated or replaced exhibits, and extended terms.

Discussion

Amendment 2004-1 does the following: 1) Adjusts the full capitation allocations to reflect the CFY 2004 Budget Adjustments made by the Commission, 2) Modifies the risk sharing and withholds provisions to avoid a negative impact on hospitals as a result of the Commission’s actions at its May 12, 2004 meeting, 3) Reduces the amount of the Medicare Part A deductible HPSM pays for inpatient admissions by 50% with a cap on the total reduction in the next 12 months (Medi-Cal fee-for-service does not pay any of the Medicare deductible), 4) Cleans up language to make the sending of notices more cost effective and efficient, and 5) Updates the list of AID Codes in Exhibit 3A to be consistent with the Medi-Cal program, 6) Provides two supplemental payments of $1,343,500 each to San Mateo Medical Center as outlined in subsection (8), under Section C of Exhibit 2, and 7) Increases the Acute Medical/Surgical Day to $1,502 for up to 3,600 inpatient days in calendar year 2004.

Vision Alignment

This agreement with San Mateo 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 Medical Center.

Fiscal Impact

This amendment has a $3.4 million positive fiscal impact on San Mateo Medical Center ($360,000 for FY2003-04 and $3,045,000 for FY2004-05). This projected revenue is included in San Mateo Medical Center’s FY2004-05 Adopted Budget.