COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Health Department

DATE:

January 23, 2006

BOARD MEETING DATE:

January 31, 2006

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

TO:

Honorable Board of Supervisors

FROM:

Charlene A. Silva, Director, Health Department

Gale Bataille, Director of Mental Health Services

SUBJECT:

Agreement with the State Department of Mental Health for Managed Care Services

RECOMMENDATION:

Adopt a resolution authorizing the President of the Board to execute an Agreement with the State Department of Mental Health for Managed Care services for the term July 1, 2005 through June 30, 2006, for a maximum of $9,153,862.

VISION ALIGNMENT:

Commitment: To ensure basic health and safety for all.

Goal 8: Help vulnerable people-the aged, disabled, mentally ill, at risk youth, and others- achieve a better quality of life.

This Agreement contributes to this commitment and goal by providing managed care mental health services to a vulnerable population.

BACKGROUND:

In April 1995, under a 1915(b) waiver granted to the State Department of Health Services (DHS) by the Centers for Medicare and Medicaid Services (CMS), formerly the Health Care Financing Administration (HCFA), San Mateo was the first California county to implement a managed mental health care system for Medi-Cal beneficiaries. At the end of the initial two-year waiver period, the San Mateo Mental Health Services Division worked with DHS and the Department of Mental Health (DMH) to submit a second federal waiver request, which was approved effective July 1, 1998, and was extended through October 31, 2001. Since that time Mental Health Services has applied for and received waivers allowing the continued operation of our managed care mental health system. Our annual DMH Managed Care Agreements have authorized the San Mateo County Mental Health Plan to provide mental health services under the conditions of these federal waivers to Medi-Cal eligible clients and provide State General Fund revenue to support managed care and other specified services. Effective July 1, 2005, San Mateo County is folded into the waiver operated by DMH for all California counties, which is not a 1915(b).

DISCUSSION:

This Agreement represents a change in the form of reimbursement from a case rate to fee-for-service, which is the form of reimbursement from the state for all other counties in California. The FY 2005-06 budget for Mental Health Services was developed taking into account this change.

The Agreement defines the requirements for quality improvement, record keeping, client rights, availability and accessibility of services, utilization management, provider certification, fee-for-service reimbursement, responsibility for medications prescribed by psychiatrists, and laboratory services. It also establishes requirements for Day Treatment Services, Therapeutic Behavioral Services (TBS), certification of program integrity, the Health Insurance Portability and Accountability Act (HIPAA), and other program requirements.

DMH will amend this Agreement early in 2006 to reflect the amount included in the approved State budget for FY 2005-06. This Agreement has been delayed due to delays by the state in clarifying changes in language related to the change from case rate to fee-for-service reimbursement. The term of this agreement is July 1, 2005 through June 30, 2006.

FISCAL IMPACT:

The Agreement maximum is $9,153,862 for FY 2005-06. This includes $6,385,000 as the state share of Medi-Cal expenses for pharmacy and related laboratory services. The balance of $2,768,862 is the state share of Medi-Cal expenses for other managed care activities and services. The FY 2005-06 recommended budget for Mental Health includes the full amount of this agreement.

In addition to the state allocation, Mental Health Services bills the State separately for the federal financial participation (FFP) of Medi-Cal. The state and federal revenue is included in the adopted FY 2005-06 Mental Health Services budget.