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COUNTY OF SAN MATEO
Inter-Departmental Correspondence
Health System
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DATE:
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June 23, 2010
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BOARD MEETING DATE:
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July 27, 2010
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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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Jean S. Fraser, Chief, Health System
Susan Ehrlich, MD, MPP, Chief Executive Officer
San Mateo Medical Center
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SUBJECT:
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Amendment to the Agreement with Healthcare Cost Solutions, Inc.
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RECOMMENDATION:
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Adopt a Resolution authorizing the:
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A)
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President of the Board to execute an Amendment to the Agreement with Healthcare Cost Solutions, Inc., for the term of March 1, 2009 through February 28, 2011, and increasing the amount of the Agreement by $50,000, from $100,000 to a new maximum fiscal obligation of $150,000; and
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B)
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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.
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BACKGROUND:
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The service provided by Healthcare Cost Solutions, Inc. (HCS) is an intricate part of the overall compliance program for San Mateo Medical Center (SMMC). This company has provided coding validation audits for SMMC since 2004. HCS provides monthly validation audits based on the annual monitoring and auditing plan required by the Corporate Compliance Program of SMMC. HCS also provides training and feedback sessions to physicians on correct coding procedures, as well as consultative services on patient coding unit structure and appropriate use of Diagnosis Related Group (DRG) and Current Procedural Terminology (CPT).
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On September 24, 2009, the County Manager approved a Change Order which amended the fee payment schedule. On April 6, 2010, the County Manager approved a Second Change Order extending the term through February 28, 2011.
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DISCUSSION:
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HCS is a critical component of SMMC’s Compliance Program, ensuring patient safety and providing guidance to meet the requirements put forth by the Centers for Medicare and Medicaid Services (CMS), which is the primary payor of SMMC services. These efforts help to improve coding accuracy and ultimately affect SMMC’s Revenue Cycle. Currently, there are no in-house resources to provide coding validation audits and training and feedback sessions to physicians and so services are required more frequently than anticipated. SMMC is requesting Amendment No. 3 to add $50,000 to this contract as a result of an increased need in services. The contract expires in February 2011, and the addition of funds is required to continue this critical work through then.
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The Amendment and Resolution have been reviewed and approved by County Counsel as to form.
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The Contractor has assured compliance with the County’s Contractor Employee Jury Service Ordinance, as well as other contract provisions that are required by County ordinance and administrative memoranda, including but not limited to insurance, hold harmless, non-discriminiation and equal benefits.
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This Amendment contributes to the Shared Vision 2025 outcome of a Healthy Community by ensuring patient safety and fiscal and compliance responsibility to meet the requirements put forth by the Centers for Medicare and Medicaid Services (CMS), which is the primary payor of SMMC services. It is anticipated that these services will help SMMC obtain a 95% DRG coding accuracy rate.
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Performance Measure:
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Measure
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FY 2009-10
Estimate
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FY 2010-11
Projected
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Diagnosis Related Group (DRG) Coding Accuracy Rate
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90%
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95%
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FISCAL IMPACT:
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The term of this Agreement is March 1, 2009 through February 28, 2011. The Amendment increases the funding by $50,000 for a maximum amount of $150,000. Funds in the amount of $100,000 have been included in the SMMC FY 2009-10 Adopted Budget, and funds in the amount of $50,000 are included in the SMMC tentatively Adopted FY 2010-11 Budget.
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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.
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