CEO Editorial: A disappointing decision

I am disappointed that after months of discussions, Fresno County apparently has decided not to accept suggestions from the federal government that could have enabled Community Medical Centers to receive as much as $54 million in special Medi-Cal funding over three years.

This money would have benefited the numerous needy patients that nonprofit Community serves as the region’s safety net. Instead, Community is preparing to repay the $18 million we received last year from the federal government as part of this special program.

Here’s some background.

As part of Community’s Medi-Cal rate renegotiation in 2006, the state urged Community to enlist Fresno County’s help to take advantage of an “intergovernmental transfer” (IGT) process.  Under the IGT, the county forwards money to the state, and the state in turn secures federal matching funds. Most of the new, larger amount then comes back to the designated health care beneficiary, in this case Community, to help cover the costs of providing Medi-Cal services.

Through the IGT, Community received $18 million in new money last fiscal year, in addition to the $18 million that the county normally pays Community under a 1996 contract. This special funding, a byproduct of a Medi-Cal redesign law signed in 2005, is available for three years.

However, in January, the federal government questioned whether aspects of the agreement would qualify for the IGT, indicating Community might have to repay the special funding.

Since then, the U.S. Centers for Medicare and Medicaid Services and the California Department of Health Services have participated in numerous discussions with Community and Fresno County. United States Rep. Jim Costa of Fresno also has provided valuable assistance in efforts to reach a resolution.

Recently, the federal government provided suggested contract language that it believes addresses the concerns that it raised in January. However, Fresno County supervisors apparently decided May 22 in closed-door session not to accept the federal government’s offer of assistance.

Their reasoning is not clear. Their action is surprising, given that Fresno County went to great lengths to cooperate with us last year to secure the additional money. State officials have offered assurances that other counties have successfully made similar funding arrangements.

So, we now face the prospect of repaying the $18 million, money that we set aside when concerns were first raised.  Just to be clear, we do not owe the government $54 million, as a recent newspaper headline erroneously stated.

This is a sad development in Community’s 100-year history of caring for a region with numerous chronic medical needs and which has historically been underserved in government health care funding.

We continue to vigorously pursue other funding opportunities through the government and other sources. And we will continue to ensure our long-term financial well-being using cost controls and providing quality-focused health services.  

Tim A. Joslin
Chief Executive Officer
Community Medical Centers