Inter-Departmental Correspondence

Health System



January 29, 2010


May 25, 2010







Honorable Board of Supervisors


Jean S. Fraser, Chief, Health System
Susan Ehrlich, MD, MPP, Chief Executive Officer
San Mateo Medical Center


Agreement with Sentry Data Systems, Inc.



Adopt a Resolution:


Waiving the Request for Proposals process; and



Authorizing the President of the Board to execute an Agreement with Sentry Data Systems, Inc. to provide a software application for the San Mateo Medical Center to purchase and utilize 340B drugs in mixed use settings for the term May 1, 2010 through April 30, 2013, for a maximum obligation of $350,000; and



Authorizing the Chief of the Health System or designee to execute contract amendments which modify the County’s maximum fiscal obligation by no more than $25,000 (in aggregate), and/or modify the contract term and/or services so long as the modified term or services is/are within the current or revised fiscal provisions.



Regulations for participation in the 340B purchasing program prohibit covered entities from using medications purchased through the entity’s group purchasing organization (Amerinet) to be administered to patients in the outpatient setting. New regulations require that drugs billed to Medi-Cal must have the 11-digit National Drug Code (NDC) number on the claim form. Those regulations also provide that the entity may not bill Medi-Cal for more than actual acquisition cost.



Sentry Data Systems, Inc. (Sentry) provides a software that will assist the San Mateo Medical Center’s (SMMC) Pharmacy in complying with the new regulations by using actual purchasing data to update claim forms, to include the 11-digit NDC number and the actual cost paid for medications. Sentry’s software application will retrieve admission, transfer, discharge and medication administration data in real time to create a purchase order that will allow SMMC to purchase and utilize “340B drugs” for eligible patients treated in the “mixed use” settings, such as Emergency Department, Short Stay Surgery, Infusion Center, etc.


This software tool helps to ensure compliance with regulations regarding the use of 340B purchased drugs in the outpatient setting. With it SMMC will be able to purchase 340B drugs at reduced cost. A pilot program has shown that drug costs have decreased by an average of $3500 to $5000 per month. Although this tool will not offset the entire cost, it does reduce the overall costs while complying with regulations.


Sentry is the sole source of their trademarked application “Sentinel RCM.” The application meets all the needs of the SMMC pharmacy, adheres to all current regulations and provides a costs savings to the County. Therefore, it is in the best interest of the County to waive the RFP process.


Risk Management has reviewed and approved this Agreement. County Counsel has reviewed and approved the Resolution and Agreement as to form. The contract provisions have been reviewed and approved by the County’s Information Services Department. Through negotiations between County Counsel and Counsel for Sentry, Section 504 of the Rehabilitation Act and non-discrimination clauses were incorporated into the contract. Sentry does not have any employees who live or work in the State of California. A waiver of the Contractor’s Declaration Form was approved by the County Manager.


Approval of this Agreement contributes to the Shared Vision 2025 outcome of a Healthy Community by providing compliance with new regulations while ensuring that prescription drugs are available for patients of SMMC. It is anticipated that 98% of all refill prescriptions will be filled within 24 hours.


Performance Measure:


FY 2008-09

FY 2009-10

Percentage of refill prescriptions filled within 24 hours





The term of this Agreement is May 1, 2010 through April 30, 2013. The maximum fiscal obligation is $350,000. Funds in the amount of $132,166 are included in the SMMC FY 2009-10 Adopted Budget. This amount includes funds to cover the cost of one time implementation fees and annual fees. Funds in the amount of $79,667 will be included in the SMMC FY 2010-11 Recommended Budget. Similar arrangements will be made for future years. Expenses at SMMC are covered by fees for services or third-party payors whenever possible. The portion of expenses for services provided to the medically indigent or to those covered by programs that do not meet the full costs of care are covered by the County’s General Fund contribution to SMMC.