Board of County Commissioners
Agenda Request 26

HEALTHCARE COMMITTEE MEMBERS:
Parwez Alam, County Administrator, Duncan Moore, Tallahassee Memorial HealthCare CEO and Sharon Roush, Tallahassee Community Hospital CEO

COMMITTEE SUPPORT STAFF:
Andrea Bird, Assistant to the Director of Administration
Art Cooper, Administrator, Leon County Health Department
Don Killingsworth, Director of Pharmacy, TCH
Vincent Long, Assistant County Administrator
Rob Moss, Group Practice Administrator, TMH
Benjamin Pingree, Budget Analyst
Alan Rosenzweig, Budget Director

STATEMENT OF ISSUE:
During the September 18, 2001 Workshop on Healthcare Delivery System Alternatives, the Board appointed a committee of three comprised of the County Administrator and administrators from both Tallahassee Memorial HealthCare and Tallahassee Community Hospital to study alternatives available, and make a recommendation to the Board regarding the most efficient means by which to deliver healthcare to the County’s uninsured.

BACKGROUND:
On May 29, 2001, the Board held a workshop to hear a presentation of the Report and Business Plan for a Healthcare Delivery System for Uninsured Residents of Leon County by MGT of America (Attachment #5). After this presentation, the Board directed staff to schedule a public hearing to consider implementing a Municipal Service Taxing Unit (MSTU) to fund primary healthcare for the uninsured.

The first and only public hearing on the proposed ordinance creating a primary healthcare services MSTU was held on June 12, 2001 (Attachment #6, pages 42-60). At this public hearing, the Board heard citizen testimony regarding the proposed MSTU, adopted the ordinance, and directed staff to explore additional funding alternatives for providing uninsured healthcare services to Leon County citizens.

During the July 24, 2001 budget workshop (Attachment #6, pages 22-27), the Board voted unanimously to fund Healthcare Services for uninsured residents of Leon County. However, the motion did not specify the means by which the Healthcare Program would be funded, but rather deferred this decision until the July 31, 2001 regular meeting.

At the July 31, 2001 regular meeting, the Board voted to approve the funding of the Uninsured Healthcare Program for one year by using $500,000 from the self-insurance fund balance, levying a countywide MSTU of 0.06 mills (which should generate approximately $500,000), and $200,000 from the Intergovernmental Transfer/Special Medicaid Program option. The Board deferred the decision on which type of delivery mechanism to use until further analysis could be performed.

On September 18, 2001 the Board held a workshop to review staff analysis and to determine a method by which a healthcare program would be delivered to the community (Attachment #6). During this workshop the Board approved a motion to convene a committee including the County Administrator and administrators from both Tallahassee Memorial HealthCare and Tallahassee Community Hospital to perform further analysis on the models provided in the workshop packet, as well as any other models or variations they may wish to consider, and to recommend a healthcare delivery system model most efficient and appropriate for the needs of the community.

In addition, staff was to provide written clarification regarding the following health service issues:

- $181,000 grant for the FAMU pharmaceutical program;

- Plans for optometry services; and

- Plans for the hiring of additional physicians.

This agenda item presents the committee’s findings for Board consideration.

ANALYSIS:
The Healthcare Committee convened on September 20, 2001 following the Board’s direction during the September 18, 2001 workshop. The charge of the Committee was to further study possible delivery mechanisms for uninsured healthcare services and recommend the most efficient way to deliver healthcare to the uninsured in the community. The Board requested that the Committee bring back a recommendation by November 15, 2001. To address their charge, the Committee began a series of meetings, interviews, data collection, verification of existing reports and analysis and tours of clinics to form their recommendation to the Board (see Attachment #3 for a schedule of Committee meetings and activities).

The objectives of the Committee were to analyze the CareNet System (the program recommended in the MGT Business Plan) by verifying and updating information within the MGT report, determine how an Insurance/HMO model could provide healthcare services, determine how a small business model could provide healthcare services, explore other options that might be available within the community, and ultimately determine the best method available for the provision of healthcare services to the uninsured.

UNINSURED CITIZENS OF LEON COUNTY

The Committee reviewed the targeted population estimates eligible for participation in the program. The original MGT report identified 27,614 uninsured citizens in Leon County. The 27,614 is included in the Florida Health Insurance Study (FHIS) Small Area Analysis. The Program Analysis Office of the Florida Agency for Health Care Administration (ACHA) is responsible for the compilation of this data. Staff discussed this figure with both ACHA and MGT. It appears the original 27,614 figure includes certain residents of Leon County that would not be eligible for participation in this program or are eligible for different programs. Specifically the 27,614 includes10,162 non-elderly with income over 200% of the Federal Poverty Level (FPL). In addition, the 27,614 includes 4,347 children under the age of 19 with income less than 200%; these children are eligible for Healthy Kids (or similar Florida Kid Care program). Funding from the MSTU is recommended for Healthy Kids. The following summarizes the revised target population:

According to the MGT report and generally accepted industry standards, the general principle is to build coverage for half the targeted population. Based upon the targeted population of 13,105, services should be provided to 6,553. The CareNet model currently services 2,500 of these targeted individuals in our community (according to the LCHD). This leaves 4,053 individuals requiring additional services.

Current Estimated Target Population for County Program 13,105

less half of the target population (6,553)

less the 2,500 individuals currently serviced by CareNet (2,500)

Subtotal for target population (1999) 4,053

Future Growth from 1999 Base 500

Current Estimated Target Population for the County Program 4,553

The following sections provide the delivery mechanisms explored by the committee to service these targeted 4,553 individuals (rounded to 4,500 for calculations within budget and implementation plan). Also included in each section are the findings of the Committee on each alternative, the methods by which they came to their recommendations, and finally, an implementation plan and budget to provide healthcare to the uninsured.

The Insurance/HMO Model was brought to the Board’s attention during the spring of 2001 by representatives of the industry. This model consists of soliciting bids from local Health Maintenance Organizations (HMOs) for the provision of an insurance product for primary healthcare services.

An Insurance/HMO plan offers flexibility in the extent of primary care services that could be provided. Insurance and HMO companies could tailor their primary care insurance packages to the needs and/or desires of the County. The premium, or cost of coverage, would depend on the number enrolled, enrollment criteria and extent of primary care services the County would like to provide. The information received from the HMO representatives interviewed was provided with the caveat that, until put in the form of a formal RFP, the representatives would only be able to give rough estimates for cost, and rough sketches of what an insurance product would look like for such a proposal.

The Committee contemplated submitting a RFP to receive actual cost proposals for analysis purposes, however, after interviewing the HMO representatives, the Committee determined this exercise unnecessary.

Methodology
The Healthcare Committee and support staff met with representatives from Capital Health Plan, HealthEase and Healthplan Southeast. The meetings consisted of separately interviewing representatives from each company regarding the viability of a primary care insurance product as a means to deliver healthcare to the uninsured community. (A comparison of each company is provided in Attachment #6, pages 61-63.) In addition, the Healthcare Committee met with representatives from the We Care Network. Information obtained from all these healthcare representatives led the Committee to the following conclusions regarding the Insurance/HMO delivery system model:

Analysis
During the interviews, concerns were expressed by representatives from Capital Health Plan and Healthplan Southeast regarding using a primary care HMO/Insurance product to address the healthcare needs of the community’s uninsured. One of the concerns deals with the methodology by which people will be selected and enrolled in the program.

The representative from Healthplan Southeast voiced concern regarding the method by which citizens would be enrolled in this type of program. A method would need to be used that insured an equal proportion of healthy individuals were enrolled to the number of sick persons enrolled. Most insurance models are based on actuarial models whereby the population represents a balance of healthy and sick, young and old, and those who will use the system in a given year and those who will not. The concern from this representative is that the HMO would be expected to provide care for "the most in need" of the uninsured, or the more costly of the potential recipients. It was suggested that a random selection of enrollees, or a medical test for eligibility would be good methods for enrollment selection as these would mitigate the risks the HMOs would face in covering only sick individuals.

An issue put before the Board in their September 18, 2001 workshop was again addressed by the Committee. That issue being that in order for an HMO to formally bid on a primary care only product, the applicant HMO would be required to have a license addendum from the State Department of Insurance (DOI) to become a Pre-paid Health Clinic (Part II, Chapter 641). None of the local HMOs that the Committee spoke to currently have this license addendum. Going through the process of applying for and receiving this license addendum could take up to three months. The Committee did not feel it appropriate to request the industry to do this given the facts before them.

The most compelling argument against a limited primary care insurance product is that the scope of care to be provided by HMO doctors would be very limited. For instance, doctors would be able to become familiar with the patient’s health problems and diagnose his/her ailments, but this model would limit the extent to which the doctor could prescribe remedies to the patient. A patient could see his primary care physician under this model with complaints of a headache. The doctor can diagnose that the patient in fact has a brain tumor, but could not continue treatment beyond the scope of primary care and can not refer this patient for specialty care that would be covered by the insurance product. According the Capital Health Plan representative, these limitations in scope of care may, in fact, inhibit physicians from even agreeing to provide care under this insurance package.

These discussions led the Healthcare Committee to a meeting with representatives from the We Care Network: a network of 315 volunteer physicians sponsored by physicians of the Capital Medical Society Foundation. The We Care Network works collaboratively with other physicians, the Leon County Health Department (LCHD), Bond Community Health Center (Bond CHC), Neighborhood Health Services (NHS), and both local hospitals, laboratories and many other healthcare providers to coordinate specialty care, surgery, follow-up diagnostics, laboratory work, case management and x-ray requests for patients at and below 100% of the federal poverty level.

Patients are referred to the program by their treating physician. If they do not have a physician or their physician does not participate in the Network, the patient is referred to the Bond CHC or NHS clinics so they can receive primary medical care. If the primary care physician feels specialty care is warranted, then he or she will refer the patient to the We Care Network. The primary care physician or establishment cannot charge the patient for care if they would like to access the volunteer services of the We Care Network.

Patients referred by their physician will be interviewed and their eligibility determined. Eligible clients are Leon County residents, have an income that does not exceed the federal poverty level and have no other form of coverage (i.e., Medicaid, Medicare, health insurance, etc.). Should a patient be referred to the We Care Network who does not meet this income eligibility requirement, the We Care case managers work with the patients to get them in other healthcare assistance programs they are eligible for that may compensate for their medical care. In these instances, We Care provides short-term case management (for CareNet recipients between 100 and 200% FPL).

A tenet of the We Care Network is that referrals are accepted only from non-profit organizations and from physicians who are not compensated for the care they are providing to the referred patient. With this in mind, the We Care Network could not accept referrals from Insurance/HMO physicians who are paid for services.

The We Care Network is a significant addition to the continuum of care currently being provided uninsured residents of Leon County through the CareNet System. Patients admitted into the We Care Network remain in the program until the specialty physician releases them back to their primary care physician or their financial status improves or they become eligible for another program that will compensate for their care. They will receive access to appointments in the physician’s office, lab work and radiology diagnostics. If deemed necessary, the patient also has access to hospitalization, pathology, anesthesiology, home healthcare, medical equipment and medications, as available.

Since 1992, the We Care Network has provided more than $13 million in donated specialty care to needy patients. Their trust and support is in the CareNet Model and representatives specifically do not support an insurance solution to the County’s uninsured healthcare program, simply because of its limitations of care. Not only do they believe that an Insurance/HMO model will not work in this community, they also contend that such direction may destroy the current healthcare volunteer networks that offer so much in continued care to the community’s needy and uninsured.

The Representative from HealthEase did not share the concerns of the other two HMOs with regard to enrollment or scope of care. The representative stressed the advantages of an Insurance/HMO model; such as, the County’s ability to control the costs of the plan simply by managing enrollment numbers, the non-clinical setting of doctors’ offices and the infrastructure of services already in place.

The Committee concurred with much that was addressed in the September 18, 2001 workshop item regarding the disadvantages of the Insurance/HMO model. (Attachment #6, page 8). Possible jeopardy of the We Care Network was a consequence that could eliminate a valuable resource in specialty care in the community. The feasibility of providing the primary care through an insurance model exists; however, it is evident that the care would stop there.

The Committee also concluded that it is favorable to make healthcare available to all the uninsured in the County via the clinical model where those individuals who need the care the most will have access to it, rather than cover a portion of the county’s uninsured via the insurance model and risk that someone who is in dire need of healthcare would not be enrolled.

The Small Business Assistance/Insurance Model was presented to the Board during their September 18, 2001 workshop. This model, based on the Access Health Program of Muskegon, Michigan, targets employees of small to medium-sized businesses who have the ability to pay something for healthcare but not necessarily full premiums. The model contemplates an insurance package, made available to small businesses, and financed according to a three-way "shared buy-in" among the employer (30%), the employee (30%) and the community (40%). The community share, for purposes of this discussion, would be the funding provided by Leon County.

Staff met with representatives from the Chamber of Commerce that included small business owners to explore the Small Business/Insurance Option as detailed in the September 18, 2001 workshop packet (Attachment #6, pages 9-11). The purpose of this meeting was to discuss the viability of this option from the perspective of small business owners. Staff provided an overview of the Muskegon, Michigan model tailored to the needs of Leon County, and the concept of the shared premium cost between the employer, employee and community for discussion.

In addition, during previous interviews of the local HMOs, each was asked to provide costs associated with their small business insurance packages. The companies were not comfortable quoting prices without a RFP, or demographic information as to the type of individuals they would be covering, however, one HMO confided that an average cost for a small group insurance package would be about $210 per person/per month.

Analysis
As detailed in the September 18, 2001 workshop packet, the Small Business Assistance Model consists of offering an insurance product through a local HMO and subsidizing the cost for small business owners who currently do not provide health insurance to their employees. The cost for the healthcare package is shared between the employer (30%), the employee (30%) and the community, or in this case, Leon County (40%).

Within this model, employers who currently provide insurance to their employees, or have within the last 12 months are excluded from participating in the program. This is necessary to keep businesses that currently offer health insurance from dropping their coverage (which may be a more extensive package) to participate in the County’s program. Chamber representatives objected to this component of the program, stating that small businesses who try to "do the right thing" for their employees would be penalized, while their competitors, not previously offering health insurance, would benefit unfairly. In addition, not only do the business owners currently pay the full, unsubsidized price to offer health insurance to their employees, they are now also paying property taxes that assist their competitors to offer similar health insurance benefits for a fraction of the cost.

When asked what barriers existed to small businesses in providing health coverage to their employees, the Chamber representatives stated that the biggest obstacle would be the cost of the insurance product. In their view, the reason small business owners feel compelled to offer health insurance is not only for the recruitment and retention of good employees, but also out of a social obligation to their employees. It is possible that some businesses would not offer health insurance to their employees, even with a cost subsidization.

The Committee concurred with much that was addressed in the September 18, 2001 workshop item regarding the disadvantages of the Small Business Assistance Model (Attachment #6, page 11). Much of the disadvantages of the Small Business Assistance Model have to do with fairness issues to small businesses already providing health insurance, as well as the need for an extensive survey of the small business community to determine how the availability of this option would be received.

CareNet’s existing services, which cover the healthcare needs of all uninsured citizens (including small business employees) are provided without any cost to the employer. Further, much like the consequences of the Insurance/HMO Model, the Small Business Assistance Model may prove a disincentive for the We Care Network volunteer health providers to continue their services as more of the County’s uninsured citizens would gain healthcare through a "provider pay-for-services" model.

The walk-in clinic alternative contemplates providing healthcare services to the County’s uninsured by contracting the services provided through existing walk-in clinics in the community.

The Committee met with Brian Webb, the President of Patients First and a representative from the walk in clinic industry, to explore the viability of a healthcare delivery system utilizing local walk-in clinics to provide healthcare to the uninsured.

Mr. Webb was asked whether he thought a walk-in clinic would be interested in, or could reasonably establish a program with the County to serve the uninsured of the community. Although interested in continuing to assist the County in this endeavor (some Patients First doctors currently volunteer their time through the We Care Network), he believes that the financial risk associated with such a prospect would be too great for a private, independent corporation like Patients First to assume. The risk relates to receiving enough in reimbursements within the program to cover the costs of care.

Patients First currently has 19 doctors working within 5 clinics through out the community. A few additional physicians assistants and nurse practitioners make up the remaining staff (26 in total). Patients First could reasonably take on an additional 3,000 patients, however the "risk would far outweigh the reward."

Patients First does not serve Medicaid or Medicare recipients (less than 1% of their current patient make up is Medicaid). Mr. Webb explained that treating patients within these programs does not generate income, and does not allow the company to cover the costs of care. He feared that the reimbursements the County would offer through their program would barely cover the cost of care, and the company as a private, for-profit entity relies on patients’ fees as their only source of funding.

Currently, Patients First does not have a program set up for primary care, only. They refer patients to local pharmacies to fill prescriptions and do not offer an on-site pharmacy.

The Committee did not further pursue this alternative after the interview with Brian Webb. It was apparent that, although companies like Patients First would be interested in continued contribution to the care of the community, it would not be prudent for a private, independent corporation like Patients First to assume the financial risk associated with an uninsured healthcare program.

As detailed in the September 18, 2001 workshop packet, the CareNet Model has been developed over the past seven years through a collaborative community effort. Much of the services provided through the CareNet Program exist due to time and care donated by local primary care physicians, specialty physicians, and in-kind services and donations made by local hospitals and healthcare organizations. The primary purpose of the CareNet Program is to expand access to primary care services for uninsured and working families of Leon County through public and private sector collaboration.

The Healthcare Committee and support staff performed a detailed analysis of the CareNet Model as presented in the MGT Business Plan. Every component of MGT’s proposed plan and budget for the expansion of CareNet was validated, and amended where necessary (Attachment #5, page 95). As provided in the MGT business plan, the following specific components were evaluated: primary care through Bond CHC and NHS, diagnostics, laboratory, pharmaceutical, We Care case management, and LCHD administration. This was achieved through tours of the Bond CHC and NHS clinics, multiple interviews with each clinic’s administration, staff analyses of the existing pharmaceutical program, staffing levels of each clinic and their overall operations and procedures, meetings with Leon County Health Department (LCHD) administrative and finance staff, review of the LCHD budget, and interviews with administrators of the We Care Network.

After extensive research and education on the existing CareNet Program, the Healthcare Committee concurred with the advantages of this model as presented in the September 18, 2001 workshop packet (Attachment #6, page 4). Significant to the CareNet Program is continuum of care and overall added value of the We Care Network component. As stated earlier, the We Care Network provides specialty care services on a volunteer basis that would not be available through any other of the proposed models. Another valuable benefit of the CareNet Program is the ease of access to care with the clinics’ extended evening hours of operation and nearby bus stops, as well as case managers and social workers to follow-up with patients, remind them of appointments and explain doctors’ instructions. In addition, it was important to the Healthcare Committee that access to healthcare was available to all of the uninsured in the County, rather than a select number enrolled under an insurance model.

The disadvantages of the CareNet Model were also addressed. These included the difficulty to limit healthcare to Leon County residents only, the limited number of primary care facilities and providers, the potential for the program to grow too large and become cost prohibitive, and the perception of the "clinical" or "institutional" setting of clinics. This latter concern was dismissed after the Committee toured the Bond CHC and NHS clinics. Both clinics were clean, professional and pleasing facilities and did not present the chaotic, dirty and "institutional" feel that may be perceived of a health clinic.

It was determined that the other concerns or disadvantages of the CareNet Model could be controlled through greater oversight of the program. Staffing levels, the pharmaceutical program, diagnostic and laboratory components, program administration, and quality assurance, oversight and accountability issues are further discussed in the "Proposed Implementation Plan and Budget" section of this report.

Many issues and concerns were brought to the forefront through the analysis of the CareNet Program. It was determined by the Healthcare Committee, that with some adjustments and inclusion of controls and oversight, the CareNet Model would be the most efficient means by which to deliver healthcare services to the County’s uninsured. The concerns and issues are discussed in detail and addressed in the next section of this report, "Proposed Implementation Plan and Budget". It was evident to Healthcare Committee that although the CareNet Model was the most efficient means by which to provide healthcare services to the uninsured, there were many aspects of the program that required increased accountability and oversight by the County.

The following section provides an implementation plan and budget for Board consideration.

The Committee created a budget and implementation plan that best met the community’s uninsured healthcare needs as identified by the Board and per the Board’s direction. Table 1 details the proposed budget for the County Uninsured Healthcare Plan as compared with the budget from the MGT Report. The Adjusted FY 01/02 column, in bold, delineates the impact to the Board for implementing this plan for the remaining three quarters of the current fiscal year (beginning January 1, 2002). The following sections will provide detail to each component of the proposed budget.

For the past three years, Leon County has received $199,333 annually from the State of Florida via the Challenge Grant, which also includes local match funding. In addition to other state appropriations directed through the LCHD for the same purpose, the Challenge Grant funds primary care services and related specialty care case management via the county’s existing CareNet program. According to the LCHD, this three year grant was scheduled to expire on June 30, 2002, however, as a result of the Special Legislative Session, it appears that his grant will end December 31, 2001 and will not be awarded again. CareNet has utilized the Challenge Grant funds to provide healthcare to approximately 950 patients annually in Leon County. Minus these Challenge Grant dollars, the LCHD contracts with the providers of CareNet for primary care services will remain intact and will be solely funded by the earmarked State appropriations.

In order to maintain the current service level of CareNet, it is recommended that the disappearing Challenge Grant funds be replaced with funding from the MSTU. As the LCHD has existing relationships with both Bond CHC and NHS for primary care, this portion of the MSTU funding will be directed through and administered by the LCHD.

As shown in the proposed budget, the replacement of state Challenge Grant funding and associated local match funding for the remainder of FY 01/02 shall be split amongst the following CareNet partners as follows:

Bond CHC $ 66,725

NHS $ 66,725

Total Replacement $133,450

Should the county decide not to replace these monies, the existing CareNet system would contract from its current level of service by removing an estimated 950 current patients. This would occur before any expansion would take place via the County plan.

FY2002: January 1 to September 30, 2002 - $133,450 (9 months)

In order to determine the funding levels for each contract, staff from Tallahassee Memorial Healthcare, Tallahassee Community Hospital and the Board were sent to both clinics to perform a series of administrative reviews of each center. These reviews included identification and analysis of operating procedures, expenditures, staffing levels, physical capacity for growth, patient encounter rates and related issues that would affect each center’s ability to engage in providing primary healthcare for the uninsured in Leon County.

The Committee determined that there are various industry standards used to determine appropriate staff to patient ratios. The Committee also determined that for the program to succeed, funding could not be provided for partial professional medical staffs (i.e. 0.5 Physician or 0.5 LPN). For the two clinics to provide the optimal levels of service and meet the needs of the targeted population, the following staff is recommended for each clinic (salaries and benefits):

1.0 Physician $140,000

1.0 LPN $50,000

1.5 Clerical $30,000

Total $220,000 annual cost

Total for 9 months $165,000

The above staffing complement is recommended for both NHS and Bond CHC. With this increased staff, it estimated that NHS should have a goal of serving an additional 2,000 patients and Bond CHS should have a goal of serving an additional 2,500 patients. The additional 500 patients at Bond are the result of the overall physical capacity of the clinic and the potential to maximize the existing staff. NHS currently relies heavily on volunteer medical providers and does not have any ability to further maximize these resources.

The Committee fully understands that this program will be ramping up over a period of time and that the ultimate number of patients served may be greater or less than the established goals. Annually, the funding will be evaluated and future allocations will be adjusted accordingly.

Recommended Primary Care Funding (NHS and Bond CHC):

FY2002: January 1 to September 30, 2002 - $330,000 (9 months)

The We Care program serves as a significant part of the continuum of care offered under the CareNet model. Under We Care, qualifying patients in need can receive comprehensive specialty care managed by a specialty care case manager. Currently, We Care maintains approximately 1,000 recipient specialty care caseloads as referred by Bond CHC and NHS. All patients who are at 100% FPL or below receive their specialty care services free of charge. Those patients who are above 100% FPL can receive short term case management through We Care Network. For the CareNet patients above 100% FPL, We Care officials would contact local specialists and introduce the referred patient to specialty care services while managing the case only on a minimal basis. However, these recipients must arrange to pay for all or a portion of specialty care services received.

The budget request of $67,532 for FY 01/02, includes funding for 1.0 FTE Case Manger, 1.0 FTE Paraprofessional, and .50 FTE Case Management Supervisor to serve additional clients. This caseload increase is sufficient to compensate for the new patients entering the CareNet system.

Currently, We Care holds a contract with the LCHD for the provision of specialty care services as referred by Bond CHC and NHS. That contract is in the amount of $21,400 and is funded in whole by LCHD through the state Challenge Grant. This is the final year of that grant and its renewal is not expected by LCHD officials. Due to this grant’s termination during FY 01/02, We Care officials expect their request to the Board for FY 02/03 to increase.

We Care currently provides free diagnostic and laboratory services that coincide with the specialty care patients receive while in the We Care network, for those at 100% FPL and under. We Care officials have estimated that capacity for these free services should continue with the additional specialty care caseloads anticipated under the County’s new program.

FY2002: January 1 to September 30, 2002 - $67,532, 9 months

Diagnostic services include basic x-ray, CT, MRI, and ultrasound. The most comprehensive estimate, or worst case scenario, approximates a cost of $4,728 per 100 patients annually. The proposed nine month FY 01/02 budget of $159,570 is comprehensive of additional diagnostic services for new CareNet enrollees at Bond CHC and NHS at an increased level of service that will reduce some of the need for referral simply to get further diagnostics.

FY2002: January 1 to September 30, 2002 - $159,570, 9 months

Costs for laboratory services at Bond CHC and NHS vary slightly. Based on current expenditure trends at both clinics, it is anticipated that approximately $3,000 is required annually for each clinic or $6,000 total.

FY2002: January 1 to September 30, 2002 - $4,500, 9 months

The Committee appreciates that pharmaceuticals are a critical component of primary care and as such needs to be funded accordingly. Bond CHC and NHS are both at different points in their respective approaches to dealing with pharmaceuticals.

Both clinics rely or will rely heavily on the various drug company’s Pharmaceutical Assistance Programs. Although each individual drug company has varying rules, the general concept is the first month of a prescription must be paid for. Paperwork is then filed with the individual drug company to request a supply of free medication for 3 to 6 months. At the conclusion of the 3 to 6 month period, new paperwork is required to be filed for each individual patient to continue to receive another 3 to 6 months of medication. Every drug company does not participate and not all drugs manufactured by an individual company may be eligible. Other rules apply, such as no more than 20 patients per medical professional may be eligible for a specific drug from a specific company. Though both clinics are extremely grateful for the drug companies donations, the program is extremely labor intensive and requires extensive follow-up and paperwork.

The following is a brief summary of the current situation at both clinics:

NHS - NHS relies on a 20 hour a week paid pharmacist, FAMU students, a large amount of donated medications from local physicians, a small amount of funding from LCHD and an active participation in various drug company’s Pharmaceutical Assistance Programs.

Bond CHS - In April 2001, the FAMU School of Pharmacy opened a pharmacy at Bond CHC. FAMU provides a full-time pharmacist free to the clinic to run the pharmacy. Like NHS, FAMU through Bond receives a small amount of funding from LCHD and is beginning to ramp up the participation in various drug company’s Pharmaceutical Assistance Programs. Bond CHS recently received a $250,000 Federal Clinical Demonstration Pharmacy Grant; included in this grant is $68,000 for medications to treat a series of illnesses.

The Committee recognizes that Bond CHC and NHS are at different points in their respective approaches to dealing with pharmaceuticals. The average cost per patient/ per month for pharmaceutical costs at both clinics is $6.42 or $77.04 per year. It is anticipated that this average will be reduced over time as the FAMU Pharmacy establishes a more substantial inventory. As the FAMU Pharmacy is in its infancy (open less than 8 months), a significant portion of their expenditures is necessary to establish an on-sight stock.

Recognizing the differences between the two clinics, the following funding is recommended:

Bond: Assuming 2,500 new patients times $77.04 or $144,450. (It is assumed that this average annual cost per patient will be reduced over time to a level closer to what NHS is experiencing.) From this amount, $51,000 from the newly received Federal Grant (grant of $68,000 was prorated to $51,000 for 9 month period) was used to offset the first year cost ($144,450 - $51,000 = $93,450). In addition, $11,250 for a 0.5 FTE clerical position was added to address the Pharmaceutical Assistance Programs.

FY2002: January 1 to September 30, 2002 - $104,700, 9 months

NHS: $60,300 for medication based on NHS current average per patient annual cost of $40.20. $11,250 for 0.5 FTE clerical to address the Pharmaceutical Assistance Programs; and $52,500 to fund the conversion of an existing 0.5 FTE pharmacist to full-time.

FY2002: January 1 to September 30, 2002 - $124,050, 9 months

Staff estimates that as community knowledge about healthcare via CareNet increases, an increase of enrollees in the Healthy Kids program will also occur. To accommodate this need for children’s healthcare, the proposed budget includes an additional $10,000 for the Healthy Kids local match for the remainder of FY 01/02. The State Legislature waived the local match through June, 2001. The $10,000 will provide funding for July, 2001 through September, 2001.

Staff recommends that the oversight of this program be housed under the County Administrator. The Program Administrator position will be funded through this program at a cost of $50,000 for the remainder of FY 01/02 (salary and benefits).

Tasks performed by the Administrator will include monthly operational monitoring to insure that only qualified, non Medicaid county residents are receiving care funded from this initiative, that monies are being expended appropriately by all CareNet partners and that program outcomes are being achieved.

LCHD staff have indicated that the potential exists for identifying CareNet patients at both NHS and Bond CHC. LCHD staff will generate a database containing this current patient information. They will share this database with the Program Administrator who will monitor the new patients that enter the system and receive care under the County’s funding umbrella. The database element of program oversight will be updated on a monthly basis.

The Administrator will provide staff support to the Healthcare Advisory Council that is codified in the Ordinance implementing the MSTU for Uninsured Healthcare. The Administrator will also generate a comprehensive annual report to the Council and to the Board that analyzes program effectiveness and identifies emerging healthcare issues pertinent to the program’s success.

Due to existing contractual relationships with Bond CHC and NHS for the provision of primary care services, LCHD staff perform quarterly medical quality assurance visits at both centers in order to insure that proper care is being delivered to patients, and related best practices are being performed. The Committee recommends that the LCHD perform medical quality assurance activities for the County’s Uninsured Program. These tasks can be performed simultaneously by LCHD staff in order to mitigate the overall cost to the community. The adjusted cost for this service for FY 01/02 will be $11,250.

Marketing serves as the community outreach mechanism that generates interest in the program and is also an educational tool for the community. The MGT Report estimated that on a recurring basis $80,000 would be required for this function. However in FY 01/02, the county has received CAP grant funding for advertisement and community outreach totaling $124,000. Therefore, the impact to the Board for FY 01/02 is zero.

The County will need to enter into contracts with Bond CHC, NHS and We Care. Funding provided to LCHD will be provided as a line-item in the budget.

To ensure the success of the program and provide the necessary level of accountability, certain elements will be included in the various contracts:

1) No funds for staff will be provided until such time as the individual staff member has been hired.

2) All funds will be disbursed on a monthly basis.

3) The providers will be required to provide a monthly report showing the number of new patients served, the total number of encounters/visits associated with these new patients, and the amount of sliding fee scale revenue realized.

4) Quarterly the providers will be required to provide an accounting of how all funds have been expended. (This is not a cost reimbursement contract. Reports will be provided for general oversight.)

5) Annually a final report will be required providing a summary of all expenditures made utilizing MSTU funds.

6) The contracts will have provisions to terminate the agreements if funds are not being properly expended.

7) Future contracts will be contingent on the number of new patients being seen and the proper expenditure of funds; understanding that the programs will take time to fully ramp up.

The Committee does not want to create an unnecessary burden on the providers to maintain inordinate amounts of information. However, the Committee understands a certain level of reporting is required to ensure that all public funds are being expended in accordance with the policy set forth by the Board.

The Committee discussed the desire to eventually expand both Bond CHC and NHS’s hours of operation to include longer evening hours, as well as weekend hours. At this time, the Committee did not feel there was enough analysis to make this recommendation. It is suggested, however, that after implementation of the expanded healthcare operations at both facilities, that this issue be revisited by the Healthcare Advisory Board.

Staff seeks Board direction on whether to amend the Healthcare MSTU Ordinance No. 01-03

regarding the role of the Primary Healthcare Implementation Advisory Board (Attachment #6, pages 45-50). The current ordinance language in Section 6, (B) states:

"The Advisory Board shall consider and develop an implementation plan and budget for the fiscal year commencing October 1, 2001...Such plan shall consider an administratively efficient, legally sufficient, and accountable organizational structure and means for the County to deliver, or cause to be delivered, primary healthcare services to indigent and uninsured residents of Leon County. Such plan shall provide for a budget for the fiscal year commencing October 1, 2001 and shall be delivered to the County no later than September 25, 2001."

On September 18, 2001, the Board appointed a Healthcare Committee consisting of the County Administrator and the administrators of both local hospitals to determine the most efficient delivery system for healthcare to the community’s uninsured. As part of their charge, this Committee also developed a proposed budget and implementation plan for Board approval. Due to the deadline that has already passed, staff recommends that the Board strike the language of the above Section 6 (B) of the Healthcare MSTU Ordinance (No. 01-03) and charge the Advisory Board to serve in an advisory capacity to the Board regarding the monitoring of the approved healthcare delivery system.

Should the Board desire, staff shall schedule a public hearing for the amendment of the above ordinance language.

Language within the Healthcare MSTU Ordinance (No. 01-03) speaks to the creation of a Primary Healthcare Implementation Advisory Board. The ordinance states that the Advisory Board shall consist of seven Board appointed members, whose initial appointments shall be for the term of 3 years. This Advisory Board shall be created by resolution. Attachment #3 presents a resolution, for Board approval creating the Advisory Board.

The Committee will make a recommendation to the composition of the Advisory Board under separate cover for the December 11, 2001 Board meeting.

County Ordinance No. 01-13 implemented the MSTU for Uninsured Healthcare. Language within the Healthcare MSTU Ordinance states the following:

Section 5 (C). "The Board shall adopt for each fiscal year a resolution (1) fixing eligible income levels and (2) adopting a sliding fee scale for persons living in Leon County who are under the age of 65, but having an income which exceeds the eligible income levels fixed by the Board."

Attachment #2 is the proposed resolution fixing income levels for the remainder of the FY01/02 Healthcare Program, as well as adopting a sliding fee scale to be utilized by both clinics. Bond CHC currently utilizes a sliding scale fee based upon income level and NHS is implementing one effective December 1, 2001. The revenue collected as a result of the sliding fee scale shall be reported to the County, as discussed in the Contracts and Reporting Requirements section of this report, and used to further supplement the delivery of healthcare services within both clinics.

During the September 18, 2001 workshop discussion, staff was to asked to provide written clarification regarding the following health service issues:

- $181,000 grant for the FAMU pharmaceutical program,

- Plans for optometry services, and

- Plans for the hiring of additional physicians.

These items are addressed in a memo to the Board, dated October 22, 2001 (Attachment #4).

The Healthcare Committee, in accordance with Board direction, presents these findings and recommendations for the Board’s consideration and approval. The proposed budget and implementation plan was prepared to consider the need for diligent oversight and accountability to the tax payers for the provision of healthcare services to the uninsured of the County. Per Board approval, the following actions need to take place to implement this program as proposed:

Accept the Committee’s findings regarding the issue of uninsured healthcare in Leon County.

Accept the Proposed Budget and Implementation Plan and direct staff to begin program implementation via county funding of the CareNet Model as proposed therein for the remaining three quarters of FY 01/02.

Direct staff schedule a public hearing on January 8, 2001 to change language in Ordinance No. 01-03 regarding the charge of the Primary Healthcare Implementation Advisory Board.

Authorize staff to develop the appropriate contracts with Bond CHC, NHS and We Care. The Chairman could then execute the contracts in advance of the proposed program implementation date of January 1, 2002.

Authorize the creation of the Program Administrator position to be housed under the County Administrator.

Adopt the resolution adopting the Sliding Fee Scale and Eligible Income Levels, as presented.

Adopt the resolution creating a Primary Healthcare Implementation Advisory Board, as presented.

1. Authorize staff to implement the Uninsured Healthcare Program in accordance with the bulleted action steps in the Conclusion section.

Authorize staff to implement the Uninsured Healthcare Program, with modifications.

Board Direction

Option 1

#1: Schedule of Committee Meetings and Activities

#2: Resolution Adopting Sliding Fee Scale and Eligible Income Levels

#3: Resolution Creating Primary Healthcare Implementation Advisory Board

#4: October 22, 2001 Memo to Board

#5: CareNet Business Plan

#6: September 18, 2001 Workshop Item