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COUNTY OF SAN MATEO
Inter-Departmental Correspondence
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County Manager’s Office
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DATE:
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November 20, 2007
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BOARD MEETING DATE:
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November 27, 2007
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SPECIAL NOTICE/HEARING:
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None
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VOTE REQUIRED:
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Majority
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TO:
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Honorable Board of Supervisors
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FROM:
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John L. Maltbie, County Manager
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SUBJECT:
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County Manager’s Report #14—Update on statewide Health Care Reform
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RECOMMENDATION:
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Accept this report.
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VISION ALIGNMENT:
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Commitment: Ensure basic health and safety for all
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Goal(s): Residents have access to healthcare and preventative care
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BACKGROUND:
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Following the Governor’s call for a special session to address health care reform, Assembly Speaker Núñez introduced ABx1 1 with Senate Pro Tem Perata.
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On November 14, ABx1 1 was heard by the Assembly Health Committee and passed along party lines. Most stakeholders see this bill as the likely mechanism for passage of health care reform. A competing bill ABx1 2, without an author, failed to pass from the committee. ABx1 1 represents the bulk of the policy elements of health care reform.
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A companion petition ballot initiative (currently expected to appear on the November 2008 ballot) would include the finance mechanism. This bifurcation will avoid a two-thirds vote requirement of the Legislature. The expected total cost is approximately $14 billion annually. The Speaker’s proposal would also include an individual mandate requirement, a four percent fee on hospital patient revenues and increases in Medi-Cal reimbursement rates.
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There are a number of hurdles for health care reform including passage from the Legislature, the Governor’s signature, qualification and passage of a petition ballot initiative for the financing mechanism, survival of subsequent litigation and the challenges of implementing such significant reforms by the current deadline of July 1, 2010. However, a number of participants believe this is the most viable of efforts to date.
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The Assembly is expected to vote on the bill by November 26 (before publication of this report, but after hearing this item at the November 27 Board meeting). If the bill passes from the Assembly, the Senate Health Committee will hear the bill before it is considered by the full Senate. If approved by the Legislature, ABx1 1 could be before the Governor as soon as December 3 for signature or veto.
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DISCUSSION:
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ABx1 1 and related discussions about financing have raised a number of issues of concern to counties.
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County Share of Cost
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The health care reform proposals from both the Administration and the Legislature currently include a $1 billion contribution from counties due to the expected reduction in medically indigent adults that would participate in a form of health care coverage other than current Welfare and Institutions Code Section 17000 safety net services.
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Welfare and Institutions Code Section 17000
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Despite assertions that the medically indigent adult (MIA) population will decrease, most legislative and administration leaders are currently unprepared to accept a shift (or anything that can be construed as a shift) of any portion of counties’ Section 17000 obligation from counties to the state.
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Provider fees
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ABx1 1 includes a 4% fee on hospital patient revenues. The bill also includes legislative intent to increase Medi-Cal hospital inpatient and outpatient rates. However, reimbursement rates are not expected to reach full cost recovery.
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FISCAL IMPACT:
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Unknown.
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