COUNTY OF SAN MATEO

Inter-Departmental Correspondence

San Mateo Medical Center

DATE:

February 11, 2005

BOARD MEETING DATE:

March 1, 2005

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

TO:

Honorable Board of Supervisors

FROM:

Nancy J. Steiger, Chief Executive Officer, San Mateo Medical Center

SUBJECT:

Amendment to the Agreement with Medisave Pharmacies, Inc., dba Kindred Pharmacy Services

Recommendation

Resolution authorizing an Amendment to the Agreement with Medisave

Pharmacies, Inc., dba Kindred Pharmacy Services to provide pharmaceutical

services and infusion services to patients of Burlingame Long Term Care

Vision Alignment

Commitment: Ensure Basic Health and Safety for All.

Goal 5: Provide residents access to healthcare and preventive care.

The agreement contributes to the goal by providing pharmacy services, including all medications and IV Therapy, to residents of Burlingame Long Term Care.

Performance Measures:

Measure

FY03-04

FY04-05

Timely provision of pharmacy services for Long Term Care

93%

95%

Background

Regulatory requirement states that Long Term Care is to have a clinical pharmacist

for regular medication review and administration.

On September 14, 2004, your Board approved an agreement with Medisave

Pharmacies, Inc., dba kindred Pharmacy Services to provide pharmacy services,

including all medications and IV therapy on a daily and emergency basis, to

Burlingame Long Term Care.

Discussion

Language in Exhibit B of the agreement, referring to pharmaceutical services, includes a fee for service rate of Average Wholesale Price (AWP) - 10% + $3.95. This was the formula Medi-Cal used for reimbursement of pharmacy drugs until September 2004, when Medi-Cal decreased the reimbursement rate to AWP – 17% + $8. This amendment conforms to the amount paid by the County for pharmaceutical services to the reimbursement rate paid to Medisave Pharmacies, Inc. by the Medi-Cal program at the time the services are rendered. The amendment also eliminates the pricing formula in order to accommodate any future changes in Medi-Cal reimbursement without further contract amendments.

The contract is also being amended to replace all references to “Pharmacy” in Exhibits A and B with “Contractor”.

County Counsel and Risk Management have both reviewed and approved this Amendment.

Fiscal Impact

The term of this agreement remains the same, April 1, 2004 to March 31, 2005, which leaves one month remaining. There is no material fiscal impact associated with this amendment. Under the revised Medi-Cal reimbursement rate, certain more expensive drugs will now be reimbursed at a lesser amount while less expensive drugs, at a higher amount. However, the maximum amount of $150,000 for the agreement is unchanged by this amendment.