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Commissioners meet today to try to patch up an ailing health program short on cash.
By BILL VARIAN, Times Staff Writer
© St. Petersburg Times, published January 28, 2002
Hillsborough commissioners launched their landmark health plan for the poor with an ounce-of-prevention premise:
Treat people cheaply for the sniffles today, the reasoning went, and they are less likely to show up at a more costly emergency room with pneumonia tomorrow.
A decade later, the plan that helped about 30,000 residents last year is nearly broke, suffering from funding cuts and rising costs, the weight of added programs and swelling rolls, as well as lax oversight. A once enormous rainy-day reserve built as a cushion for tough times like these has all but disappeared.
"Now it's a thunderstorm, and there's no reserve," said Commissioner Jan Platt.
Commissioners meet in emergency mode themselves -- today and Wednesday at the County Center -- as they attempt to fix the ailing program often held up as a national model. If past meetings are an indication, there will be plenty of finger-pointing.
But the real blame may rest on the failure of commissioners and their advisers to follow the course of preventive medicine the plan prescribes.
When the health plan's reserve kitty swelled to $155-million in its first six years, commissioners embarked on a self-imposed starvation diet. Facing pressure from legislators deciding whether to reauthorize the plan, commissioners cut funding by more than half without addressing fundamental problems raised in an audit.
Then they heaped $16.1-million annually in new programs on the health plan, including treatment for sick inmates and health insurance for children.
They based the moves on administrative assurances that the health plan could absorb the millions in cuts and new programs. But when they finally ordered checkups from independent consultants, they learned that cost projections were rosy at best.
The health plan was sick, emergency-room sick. With their reserves nearly gone, commissioners had little room to wiggle.
Republican commissioners have borne the brunt of the criticism, but Commissioner Ronda Storms said it's not deserved. She said that she was not on the board in 1997 when the plan's funding was slashed, but the cuts served a useful purpose beyond keeping money in taxpayers' pockets.
The debate that resulted forced commissioners to ask more meaningful questions about the program, revealing flaws in its management.
"That's what brought it to light, in my view," Storms said.
Kathy Harris, who was hired as assistant county administrator last year and has assumed oversight of the health plan, said she hopes in the future to head off problems now confronting the program.
"I think, if anything, we have to do better at staying in front of things," Harris said.
The health plan is projected to cost $97-million next year, but the half-cent sales tax that pays for it will bring in $15.5-million less than that. Harris is presenting a series of recommendations to bridge the gap.
Some of the proposals involve shifting costs back to the overall county budget and delaying some spending on roadwork. There also would be changes aimed at shortening the time patients remain on the plan.
If the proposals are approved, the moderately poor will have to earn less to qualify for catastrophic care, such as cancer treatment. And they will have to prove their income will fall below federal poverty lines as a result of treatment costs. (The federal poverty line for a single person is $8,590 in annual income, $17,650 for a family of four.)
With past hearings as a guide, dozens, if not hundreds, of people are likely to show up for this week's hearings, most of them to oppose cutting the plan. Many of them will be plan patients, who have become a formidable constituency.
Mauricio Rosas, a community activist who said he has received treatment for HIV and muscular dystrophy through the plan, said the county needs to improve oversight rather than cut.
"Patients shouldn't have to suffer because of bad finance policy and administration," Rosas said.
A handful are likely to say the plan should be shuttered altogether, including Ralph Hughes, a businessman and campaign backer of most of the members of the Republican-led commission. Hughes has opposed the program from the start.
"This has become, as I predicted, a bottomless pit," he said.
The plan was created in 1991 when commissioners convinced the state Legislature to allow counties with at least 800,000 citizens to levy a seven-year, half-cent sales tax for indigent care. The effort came against a backdrop in which Hillsborough was spending $34-million annually in property taxes on health care for the poor. And the amount was projected to keep climbing at $6-million a year.
Most of the money was going to reimburse hospitals for emergency room treatment of the poor, particularly Tampa General Hospital, which was struggling financially from the burden.
"We would have spent all our money and been keeping people basically sick with no healthy outcome if we had continued on that course," said Phyllis Busansky, a commissioner at the time.
So the County Commission, led by Busansky, championed a remedy: Use a dedicated source of tax money to pay for preventive, primary care, and the need for emergency room bailouts would fall. Legislators approved a half-cent sales tax but required the county to continue spending $26.8-million in property taxes on the plan.
The county program was to pay for treatment only for people who don't qualify for other programs, such as Medicare or Medicaid. It focuses on providing primary care at no cost to anyone living below the federal poverty line.
"This was not some harebrained scheme or liberal dream," said Deputy County Administrator Pat Bean. "We had already been in the business of paying for health care, but with no ability to have a say in the cost or to try to contain it."
The county plan amassed reserves of more than $155-million after six years, three times what was being spent on treatment. As a result, legislators blanched when they were asked to extend the tax in 1997.
Led by Sen. Tom Lee, R-Brandon, the local delegation threatened to discontinue the sales tax. Commissioners proposed a compromise to drop the tax to a quarter-cent for four years, though the full tax could be restored after 42 months if reserves fell below $77-million.
Lee did not return a phone call seeking comment for this story. But County Administrator Dan Kleman defended Lee's position, saying it ultimately enabled the county to win passage of the sales tax extension.
"He took on a very critical role to get the sales tax reauthorized," Kleman said.
Commissioners also sought and won permission to discontinue spending the $26.8-million from property taxes on the plan. All told, funding for the plan fell in one year from $85.6-million to $35.1-million.
An audit the same year raised questions about the ability of health plan administrators to track spending trends. It noted an overlap in staff responsibilities and little coordination between groups of employees. And it asserted that the Health Care Advisory Board, established to monitor the plan, spent more time advocating for its clients.
Commissioners didn't heed the warning.
Instead, they added new responsibilities to the health plan's funds: inmate health care, child care insurance, Baker Act, Medicaid funding and mental health treatment. The Legislature piled on, ordering the county to pay Tampa General $3.5-million annually to again underwrite emergency room costs.
When the time came to consider restoring the half-cent tax toward the end of 2000, commissioners declined, though reserves had fallen well below $77-million. Led by Jim Norman, the Republican majority opted to keep the tax at a quarter-cent for another 10 months.
Kleman assured commissioners they could wait without jeopardizing the plan.
But there had been changes going on within the health plan. In an attempted cost-savings measure, plan administrators stopped verifying income levels of existing plan members as regularly, resulting in people staying on the plan longer.
They also were advertising the plan, and enrollment skyrocketed from 13,800 members per month in September 1999 to nearly 20,000 18 months later. Costs jumped from $66.3-million to $95.5-million in the same period. At that rate, the program would go bust by 2004, a consultant reported last year.
Medical costs also were rising far more rapidly than health plan staff had projected. Pharmaceutical costs, for instance, climbed more than 40 percent in two years to $16-million. Prescription drugs are the plan's top cost.
"If I had the numbers they're showing today, I would not have taken the same approach," Norman said.
Meanwhile, the private administrator that processes claims for the health plan began having trouble keeping up, a problem that languished before commissioners were alerted. The private administrator was subsequently fired, as was the director of the county department that runs the program.
An analysis completed last week raised more disturbing trends. The cost of specialist care has climbed sharply, nearly doubling to $13.6-million in the past two years. The report by TriBrook Healthcare Consultants calls the finding "surprising," given the plan's stated emphasis on preventive care.
The report detailed wildly uneven caseloads among social workers and described procedures unsophisticated for a plan now 10 years old. It again faults the board's advisory committee for doing more advocacy than analysis.
Busansky, a member emeritus of the advisory board, said red flags were put up for commissioners. But Mary Ellen Gillette, the board's chairman, said the board could have done a better job.
"I very reluctantly have to say that the advisory board maybe should have been taking more of a hard look," she said. "I'm criticizing myself."
Kleman said that with the recommendations on the table, the county is on its way to getting the health plan on course. In the meantime, he said, the remaining reserves have given commissioners some time to make adjustments. Some of the changes will take some time, he said.
"The solutions we come up with I believe need to be solutions that allow us to be financially sound not just next year, but in future years," Kleman said.
He won't want to wait too long. Authorization to extend the indigent health tax will go before legislators again in 2005.