COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Health Department

DATE:

BOARD MEETING DATE:

December 9, 2008

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

TO:

Honorable Board of Supervisors

FROM:

Charlene A. Silva, Director of Health

Louise Rogers, Director, Behavioral Health & Recovery Services

SUBJECT:

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

RECOMMENDATION:

Adopt a Resolution authorizing the President of the Board to execute an Amendment to the Agreement with the State of California Department of Mental Health for Managed Care Services for the term July 1, 2006 through June 30, 2009, increasing the maximum obligation by $18,970,155.89 to a new maximum of $26,304,294.

VISION ALIGNMENT:

Commitment: 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 Medi-Cal funding for managed care services, pharmacy and laboratory services, and other specified mental health services for San Mateo County residents.

Behavioral Health and Recovery Services (BHRS) provides a range of services to promote wellness and recovery and to support consumers remaining in the lowest possible level of care. The provision of managed care outpatient mental health services is one established level of care. The funding provided through this Agreement contributes to this measure.

Performance Measure:

Measure

FY 2007-08
Actual

FY 2008-09
Projected

Percentage of clients maintained at current or lower level of care – outpatient provider network

96%

96%

BACKGROUND:

On October 24, 2006, your Board approved a managed care Agreement with the State of California Department of Mental Health (DMH) for the term July 1, 2006 through June 30, 2009, with funding established for FY 2006-07. That Agreement includes funding for the entire Medi-Cal managed care program, as well as designated funding for pharmacy and laboratory services. The Agreement also 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, certification of program integrity, the Health Insurance Portability and Accountability Act (HIPAA), and other program requirements.

DISCUSSION:

This Amendment increases the maximum funding and establishes annual funding maximum allocations for FY 2007-08 and FY 2008-09. The separate designation of funding for pharmacy and laboratory services is unique for San Mateo County among all California counties. Under this arrangement, which was established several years ago as a pilot program, BHRS receives an annual allocation for pharmacy and laboratory services. In other counties these services are billed directly to the State and paid on a fee-for-services basis. The State has determined not to pursue expansion of the pilot program to other counties and to structure funding for these services similarly to that of other counties. The State has not yet determined the date for this change. BHRS has requested that the State transfer the San Mateo County Medi-Cal funding allocation for pharmacy and laboratory services to the Health Plan of San Mateo in order to maintain both service continuity and the current level of services.

BHRS has negotiated with the State for pharmacy back payments for FY 2004-05 and FY 2005-06, which are included in this Amendment. The Amendment has been delayed due to those negotiations. The Amendment has been reviewed and approved by County Counsel and Risk Management.

FISCAL IMPACT:

The term of this amended Agreement remains July 1, 2006 through June 30, 2009. The Agreement maximum is being increased by $18,970,155.89 from $7,334,138.11 to a new maximum of $26,304,294. For FY 2008-09 the maximum is $11,914,153, which includes $2,493,000 as the State general fund match for Medi-Cal expenses for pharmacy and related laboratory services, and $2,353,653 of State general fund match for Medi-Cal expenses for other managed care activities and services. The balance of $7,067,500 is for pharmacy back payments for FY 2004-05 and FY 2005-06. The FY 2007-08 allocation also includes pharmacy back payments in the amount of $1,607,000, for a total of $8,674,500 in back payment funds. In addition to the State allocation, BHRS bills the State separately for the federal financial participation (FFP) portion of Medi-Cal. Both the State and Federal revenues were accrued from prior years and are included in the BHRS FY 2008-09 Adopted Budget.