Inter-Departmental Correspondence

County Manager’s Office



August 30, 2010


September 14, 2010







Honorable Board of Supervisors


David S. Boesch, County Manager


2009-10 Grand Jury Response



Accept this report containing the County’s response to the following 2009-10 Grand Jury report: Funding Realities and the San Mateo County Medical Center



The County is mandated to respond to the Grand Jury within 90 days from the date that reports are filed with the County Clerk and Elected Officials are mandated to respond within 60 days. To that end, attached is the County’s response to the Grand Jury report on Funding Realities and the San Mateo County Medical Center, issued on June 24, 2010.


Acceptance of this report contributes to the Shared Vision 2025 outcome of a Collaborative Community by ensuring that all Grand Jury findings and recommendations are thoroughly reviewed by the appropriate County departments and that, when appropriate, process improvements are made to improve the quality and efficiency of services provided to the public and other agencies.



There is no Net County Cost associated with accepting this report.

Funding Realities and the San Mateo County Medical Center


What follows is the County’s response to the Grand Jury’s findings and recommendations.


Grand Jury Finding Number 1. San Mateo County has had a structural deficit (expenses exceed revenues) since FY 2006-2007. This deficit is projected to be $87 million for the 2009-10 fiscal year and is expected to increase to $150 million in 2014-15.


Agree. The FY 2014-15 projected structural budget deficit has been reduced by $36 million to a revised projection of $114 million due to ongoing budget reductions in the FY 2010-11 budget.


Grand Jury Finding Number 2. The Medical Center offers patients an integrated continuum of care which provides for comprehensive medical services.




Grand Jury Finding Number 3. The Board of Supervisors has recognized the increased demands for health services due to the loss of jobs, lost health insurance and the increase of residents living below the designated poverty level as a result of the recent recession.



Grand Jury Finding Number 4. The clinics have a nine-month waiting list of 5,000 patients indicating the current demand for medical services is not being met.


Agree. As of June 1, 2010, the waiting list was approximately 5,000. As of August 2, 2010, efforts to reduce the waiting list have brought it down to 2,216 with an overall wait-time of 113 days.


Grand Jury Finding Number 5. San Mateo County is one of only two counties among California’s 58 counties that provide long-term care to its elder indigent population.


Agree, in part. The vast majority of patients receiving long-term care services in California are insured by Medi-Cal, and therefore do not rely on counties for coverage of their long-term care expenses under section 17000 of the Welfare and Institutions Code. San Mateo County does not pay for long-term care in private facilities for elder uninsured residents, but the Medical Center serves uninsured patients in Burlingame Long-Term Care and in the long-term care unit within the Medical Center’s main campus. In the fiscal year ending June 30, 2010, the indigent population represented 1% of patient days at Burlingame Long-Term Care and 6% of patient days at the Medical Center’s main campus long-term care unit.


The County does not have detailed knowledge of what other counties do regarding long-term care services for their indigent populations. It is, however, correct that very few counties operate long-term care institutions. Most long-term care is provided in private institutions.


Grand Jury Finding Number 6. San Mateo County is one of only nine counties in California that provides full health services to undocumented persons. California law requires counties to be the health care provider of last resort only for its documented residents. Thirty-five counties only provide emergency medical services to undocumented adults.


Disagree, in part. While we do not have detailed knowledge as to the practices of every other California county, a report by the California Healthcare Foundation published in October 2009, "County Programs for the Medically Indigent in California", indicates that 13 counties provide non-emergency care to undocumented residents.


Grand Jury Finding Number 7. Some California counties, such as Alameda, Fresno, and Yolo, eliminated Medi-Cal optional services (including dental, speech therapy, psychology, podiatry, optician, optometry, audiology, acupuncture and chiropractic) from their programs when the State stopped covering them in 2009.


Disagree. The State eliminated Medi-Cal optional services in 2009; counties can’t determine what benefits are offered in the Medi-Cal program as the program is administered by the State.


In San Mateo County, services to Medi-Cal beneficiaries are provided by the Health Plan of San Mateo (HPSM) through a contract with the State. HPSM is a separate entity from the County, with its own governing board. When the State cut these benefits, HPSM determined that it was less expensive to provide some of these benefits than to provide the higher cost of care that might result from their elimination.  For example, while the State decided to no longer pay for podiatry services, HPSM, as an efficiency measure and for quality reasons, decided to continue covering podiatry since diabetic patients would require more costly care without access to these services. 


The scope of services included in San Mateo County’s indigent care program is generally no more generous than the HPSM Medi-Cal program, including the areas of optional benefits that were adjusted in 2009. Some of the Medi-Cal optional benefits that were eliminated in 2009 continue to be covered when provided by a Federally Qualified Health Center (FQHC), a designation that San Mateo County clinics have that is not shared by all other counties.


Grand Jury Finding Number 8. Of the 35 California counties with a Medically Indigent Service Program (MISP), 16 require a medical need for ‘drop-in’ treatment. San Mateo County is not among these 16 counties.


Disagree. The San Mateo County Financial Assistance policies for the medically indigent state that the indigent care program does “not cover outpatient procedures or admissions deemed not medically necessary.” These policies can be found at: hppt:// No health services are provided by San Mateo County to persons who do not have a medical need.


Grand Jury Finding Number 9. The Board of Supervisors established the medically indigent income level in the County at 200% of the federal poverty level ($44,100 for a family of four versus the federally mandated amount of $22,050); therefore; services provided by the Medical Center exceed mandated state/federal requirements. All other Bay Area counties, except San Francisco, also set the medically indigent level at 200% of the federal level. San Francisco County sets theirs at 500%.


Disagree, in part. Each California county is required to provide medical care to indigent persons residing in the county under California Welfare & Institutions Code Section 17000. There is no specific statewide minimum or maximum income level set in Section 17000. Each county sets its own eligibility criteria and service level for its indigent medical care program under section 17000. San Mateo County has established 200% of the Federal Poverty Level as the upper income limit for its Section 17000 program.


Recently, some counties have been sued over their Section 17000 eligibility criteria and service level rules, with the courts holding that counties must take into account the actual financial ability of residents to obtain subsistence medical care, notwithstanding an individual’s income level. For example, in Alford vs. County of San Diego, the California Court of Appeal held that San Diego County’s flat income cap eligibility standard for its indigent medical care program that did not consider individuals’ ability to pay for all or a portion of their medical care unlawful.


Therefore, in considering eligibility standards, the County must take into account the cost of living in this area. City-Data lists the Cost of Living Index for San Mateo County in December 2009 as 170.8, compared to a national average of 100; this places the local cost of living as “very high.”


Grand Jury Finding Number 10. San Mateo Medical Center services provided to residents of San Mateo County were at a lower cost per adjusted patient day (APD) than nine comparable hospital facilities in California in 2006.




Grand Jury Finding Number 11. Redesign efforts undertaken by the Medical Center have resulted in organizational efficiencies and in savings to the general fund over the last two years.




Grand Jury Finding Number 12. The current federal health care legislation will have a significant impact on addressing the issue of health care for the medically uninsured and indigent. It is difficult to determine the actual impact at this time as its implementation in San Mateo County will not begin until 2014.






The 2009-2010 San Mateo Civil Grand Jury commends the Board of Supervisors and the Medical Center Division of the County Health Services Department for their continuing efforts to improve efficiencies in the health care system in the County while identifying and implementing possible cost cutting measures.

The Grand Jury recommends that the Board of Supervisors:


1. Address the disparity among (a) the level of health care services mandated, (b) its unrealized desire to decrease the Medical Center subsidy from the General Fund necessary to provide the current level of services, and (c) the resultant ballooning of the structural deficit.



Agree. The County is developing a revised methodology in how it allocates general purpose revenues to operating departments. The County will work with the Health System, as well as all other departments, to adjust service levels in line with available resources.


The County has experienced growing healthcare service demands as a result of the continuing economic downturn. The loss of health insurance coverage that has accompanied the loss of jobs has contributed to increased enrollment in the County’s indigent care program. Federal healthcare reform will result in expanded health insurance coverage by 2014, which will reduce the number of uninsured residents reliant on the healthcare safety net.


2. Prior to the 2011-2012 budgetary cycle, consider taking the following actions:

    a. Fund the current level of mandated health services by making reductions in other County operations,

    b. Eliminate health services programs and/or serviced populations that are not mandated by, or fully funded by, federal or state monies, including but not limited to:

      i. full service for undocumented persons,

      ii. treatment for indigent persons without a medical need

      iii. services dropped from Medi-Cal coverage in 2009

    c. Lower the medically indigent income level from $44,100, which is 200% of the federal and state mandated level of $22,050.



Agree, in part. The County is working with the Health System, as with other departments, to develop a sustainable level of service, achieving a balanced budget as part of the County’s five-year structural budget deficit elimination plan. Efforts include assessing current services across all operating departments to determine core, mandated programs and identify non-essential services as well as mandated services provided in excess of minimum service levels (overmatch).


3) Work with state and federal legislators to ensure that San Mateo County receives the greatest potential funding possible from both the state and federal levels and that efforts are made to streamline regulations that increase costs or create obstacles to delivering exceptional health care to the residents of San Mateo County.



Agree. San Mateo County’s Legislative Agenda sets as one of its objectives appropriate state and federal funding for health care services.


4) Ensure that the Medical Center continue its efforts to reduce costs and increase efficiency through current redesign initiative.



Agree. The Health System continues to seek to reduce costs and increase efficiency in all divisions. Most recently, the Medical Center has been able to reduce the primary care new patient appointment waiting list. In addition, the Medical Center has won a two-year grant to implement the Seamless Care Initiative, which uses the Toyota LEAN process improvement methodology and other proven efficiency tools to increase efficiency in all of the Medical Center clinics.