Committee Hearing, April 22, 2009

COUNCIL OF THE CITY OF PHILADELPHIA2 COMMITTEE OF THE WHOLE - - - Room 400, City Hall Philadelphia, Pennsylvania5 Wednesday, April 22, 2009, 10:20 a.m. - - - Res. 090226 - Approval of revised Five-Year8 Financial Plan covering FY 2010 through 2014. Bill 090212 - FY '10-'15 Capital Program. Bill 090213 - FY '10 Capital Budget. Bill 090214 - FY '10 Operating Budget. COUNCILMEMBERS PRESENT: Anna C. Verna, Chair Marian B. Tasco, Co-Chair15 Jannie C. Blackwell Blondell Reynolds-Brown16 Wilson W. Goode, Jr. Bill Green17 William K. Greenlee Curtis Jones, Jr.18 Jack Kelly James F. Kenney19 Donna Reed Miller Frank Rizzo20 Maria Quiñones Sanchez - - -22 V A R A L L O Incorporated23 Litigation Support Specialists 1835 Market Street, Suite 60024 Philadelphia, Pennsylvania 19103 215.561.2220 215.567.267025 2 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

Good2 morning, everyone. This is a continued3 public hearing of the Committee of the4 Whole.5 The first department that we6 will hear today will be the Health7 Department.8 (Witness comes forward.)9

Good10 morning, Doctor. Good morning and11 welcome.12

Good morning.13

Please14 identify yourself for the record and15 proceed with your testimony.16

I am Donald17 Schwarz, the Health Commissioner for18 Philadelphia. Good morning, President19 Verna and other members of Council. 25 3 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 The Department's Fiscal Year2 2010 budget request totals just under3 $332 million. 19 The Fiscal '10 budget will20 continue to support services basic to the21 Department of Public Health's ability to22 carry out its core mission to protect and23 promote the health of all Philadelphians24 and to provide a health safety net for25 4 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 those most at risk. 15 The Department continues its16 longstanding practice of contracting with17 minority-lead agencies and businesses,18 both for-profit and nonprofit. 7 However, as I told Council last8 year, I am committed to contacting with9 minority business, whether for-profit or10 nonprofit. 12 These patient fees will be13 instituted on what is known as a sliding14 scale, which means that those with the15 least means to pay will be charged the16 least. 19 I should note that this kind of20 sliding-scale fee arrangement is a federal21 requirement operation of our health22 centers as federally-qualified health23 center lookalikes. 7 Currently, the pharmacies8 dispense more than 600,000 prescriptions9 in over-the-counter medications annually10 to health-center patients. 14 Our medical staff will15 closely -- be closely monitoring patients'16 adherence to recommendations involving17 over-the-counter medications and their18 health outcomes. 11 The Fiscal Year '10 Budget is12 based on the likelihood that the13 Commonwealth will approve the request of14 the City Administration to increase taxes15 and extend payouts on the City's pension16 debt. 21 Unlike the proposed budget22 scenario I have described, a cut of this23 magnitude would result in changes in the24 level of services we currently provide. 21 Closure of one health center22 could lead to 41,767 fewer patient visits23 for about -- of 10,900 patients. 13 If these additional reductions14 to the Fiscal Year '10 Budget come to15 reality, there is no doubt they will16 present several additional obstacles to17 the Department in meeting basic public18 health needs. 4 Thank you for this opportunity5 to present testimony today. 7

Thank8 you very much, Doctor.9 If the Administration had to go10 to Plan B, we are told that a health11 center would be closed. Has the health12 center been selected?13

It has not.14

If we15 were to close a health center, wouldn't16 there be revenue losses as a result of the17 closure?18

There would. And19 one of the issues for us in choosing a20 health center would be trying to balance21 both revenue lost and also the loss of22 expense. So the dollars in the budget23 represent the net out of revenue24 generation and expense lost.25 13 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

So at2 this point in time, we don't even have an3 estimate of what the revenue losses would4 be.5

We have looked6 actually across health centers -- and I'm7 happy to provide information by health8 center on both revenue and expense -- so9 we can look at net cost per health center.10

Point of11 information.12

Yes.13 The Chair recognizes Councilman Green.14

Thank you,15 Madam Chair.16 If you could include -- good17 morning, Dr. Schwarz.18

Good morning.19

If you could20 include in what you provide in that regard21 the estimated revenue from the new charges22 and fees, not just historical revenue by23 health center. In other words, we're24 going to start charging for different25 14 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 things --2

Absolutely.3

-- in the4 future. I'm not -- so it seems to me, you5 know, if we can't make up $2 million in a6 health center doing, we're something7 wrong: We're not getting our federal8 reimbursements, we're not filing our9 paperwork properly, we're not et cetera.10 And then also please include11 what you estimate we'll be able to achieve12 in terms of reimbursements once we go13 paperless in the medical centers, the plan14 that you and I have been discussing for15 over a year.16 Thank you.17

Since this is a18 point of information, perhaps we'll talk19 when you ask me about it more.20

Thank21 you, Doctor.22 Doctor, can you tell us -- we're23 getting back to the closure of a health24 center -- what process will be used to25 15 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 determine what center could possibly be2 closed?3

So we are looking4 at both revenue and expense, we're looking5 at service utilization by health center,6 trends in the number of patients who have7 been seen at any given health center over8 time, alternatives within the9 neighborhood.10 So what are the other11 opportunities particularly for the12 uninsured to receive health services13 closer to their home.14 Travel distance, not only what's15 in the neighborhood, but what are the16 travel routes.17 Um... and the impact on the18 uninsured as best we can.19 Last year I presented20 information looking -- mapping out across21 the City the impact of individual health22 centers. You might remember my23 conversation with Councilman Jones. And24 it's that information which we have that25 16 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 is also a part of the conversation.2 We hope, I should reiterate, not3 to need to close a health center.4

And we5 agree with you.6 Doctor, in Fiscal Year '09, the7 City instituted the Acute-Care Hospital8 Assessment Program. Can you tell us what9 the goals were in its implementation? And10 have we achieved them?11

We don't yet have12 the revenue. And I'm happy to explain13 where things are, if that would be helpful14 to you. And I'm also happy to explain how15 we would spend the revenue if it came in.16

Please.17

This is a somewhat18 complex series of events.19 The first is that Council20 needed, a year ago, to authorize the21 collection of taxes from hospitals.22 Similar legislation was introduced and23 approved in Harrisburg.24 The next step, once the State25 17 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 and city have agreed -- or County have2 agreed to the collection of a hospital tax3 and the mechanism by which revenue would4 flow from the City to the State, the State5 would then need an agreement or a waiver6 from the Federal Centers for Medicaid and7 Medicare Services to agree to match those8 dollars, provide them to the State. And9 the State would then need to present a10 plan to pay the dollars back to the11 hospitals and to allow Philadelphia to12 have its share.13 It has been a long process, as14 you might imagine, in a federal election15 year. And the State has done its work.16 We have collaborated, as have all of the17 hospitals; there are monthly meetings with18 all of the hospitals in the State.19 And at the moment -- I was in20 Harrisburg yesterday, and the Department21 of Public Welfare tells me that there's22 only one more hurdle to jump for the23 Center for Medicare and Medicaid Services24 see approve the State's waiver. We expect25 18 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 that will come in May. At that time, it2 will be retroactive to January.3 I should state that the payments4 back to hospitals provide increments to5 almost every hospital in the City. So the6 hospitals are quite anxious for this7 revenue to flow, and we're quite anxious8 to have it happen so we stabilize the9 hospital network in the City. But we10 don't have the dollars yet.11 When we do have the dollars,12 they will go to both increase services at13 our district health centers to help14 finance an electronic health record for15 both the City's health centers and the16 Prison. And a part of it will go to cover17 the costs to the City for the revenue18 collection.19

I see20 that there are a number of Councilmembers21 that want to be recognized. Again, each22 Councilmember will be allotted five23 minutes on the first go-around.24 The Chair at this time25 19 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 recognizes Councilman Goode.2

Thank you,3 Madam President.4 Good morning, Dr. Schwarz.5

Good morning.6

We have a7 huge multi-million-dollar misunderstanding8 of what we're asking for in terms of9 business diversity.10 In your testimony, and in other11 testimony by other departments, it seems12 that you believe that Council was asking13 you to contract with -- or track the14 percentage of non-properties that you15 contract with that are comprised of16 minority board members. That's not what17 we're asking for at all.18 What we're suggesting is that,19 with the amount of contracts that you have20 out there, with DHS alone, it's about a21 half a billion dollars in purchase of22 goods and services.23 All of those dollars do not go24 toward salaries and benefits. Some of25 20 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 those dollars go toward the purchase of2 goods and services by those contractors.3 That purchase of goods and services by4 those contractors is done with taxpayer5 dollars.6 Therefore, they should follow7 the same business-diversity rules, and8 there should be goals for those contracts9 in terms of how those dollars are spent in10 terms of diversity.11 But, furthermore, there was12 actually a law passed, Bill 060855, which13 dealt with how we deal with diversity14 issues in terms of participation goals,15 which says within it that the report from16 the Finance Director's office, which was17 conducted by MBEC and now conducted by the18 Office of Economic Opportunity, should19 include City contract participation goals20 with disadvantaged businesses and21 not-for-profits City contracts related to22 for-profit subcontracting opportunities.23 What we're asking for, and the24 information request that I'm going to25 21 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 make, is that you contact every single2 contractor that you have that's spending3 taxpayer dollars, and you look at what4 they're spending in terms of goods and5 services, and tell us essentially what6 level of participation there is.7 But before you respond to that,8 let me clarify, even within your9 testimony, what did the Department of10 Health specifically spend in terms of11 goods and services, purchase of goods and12 services, Class 200, total amount?13

Total purchase of14 service and goods --15

With16 for-profit.17

With for-profit.18 So its total value for minority19 and women contracts is 6.2 million, total20 dollars.21

My question22 was: What's the total you spent in Class23 200 with for-profit companies?24

It is25 22 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 $11.74 million.2

And what3 percentage of that was with --4

53 percent.5

Okay, that's6 good.7 And what percentage of Class8 200, with your nonprofit subcontractors,9 do you believe is for goods and services?10

What percent of11 our contracts are goods and services?12

I'll give a13 general question first. Of the -- take14 DHS, for instance; it's half a billion15 dollars in purchase of goods and services.16

Ah.17

How much of18 that goes toward direct purchase of goods19 and services by those nonprofit20 subcontractors?21

So I apologize22 that I have my information on health; I'll23 have my information DHS this afternoon.24 I'll be happy to provide that. I'm happy25 23 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 to provide any --2

In terms of3 health, in terms of health, in terms of4 your nonprofit subcontractors, do we know5 how much business they did in terms of6 procuring goods and services from7 disadvantaged businesses?8

Nonprofits.9

Yes.10

So we are actually11 in the process of collecting that12 information. We have, I would say,13 probably about 65 or 70 percent of all of14 our vendors' information on their minority15 participation in goods and services that16 are subcontracted by them, and I'm happy17 to --18

We need that19 information forwarded through the Chair as20 soon as possible --21

Absolutely.22

-- because23 it's an extremely important part of this24 budget process.25 24 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 What you should also know is2 that I believe Councilwoman Miller has3 introduced legislation that would apply to4 economic opportunity plan requirement to5 nonprofits.6 (Timer bell rings.)7

So we're8 going to dig through this. But as long as9 those are taxpayer dollars, even if10 they're going to nonprofits, we need to11 set business-diversity goals for those12 nonprofits as well. They should have to13 play by the same rules.14

We completely15 agree, and we will provide that to the16 Council President.17

Thank you,18 Madam President.19

Thank20 you.21 The Chair recognizes22 Councilwoman Blackwell.23

Thank24 you, Madam President.25 25 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 Good morning, Dr. Schwarz.2

Good morning.3

I4 certainly want to recognize Ready, Willing5 and Able, and we're always proud to6 support them and what they do.7 My question deals with and this whole issue of charging people9 for prescriptions in heath centers and10 charging them, period, in heath center.11 I'm really concerned about patients fees.12 I mean, they say 767,000, I see. And13 medications, 1.5 million.14 But what do we gain when we hurt15 those who are unable to pay? I wanted16 to -- I don't understand that, I don't17 know what federal law would be enacted. I18 mean, the -- this president is giving more19 back to the states and the cities, not20 taking things from those -- not taking21 dollars from those who need it most.22 So I don't understand that. I'd23 like a little more discussion on that and24 where people -- is it that you're changing25 26 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 them getting prescriptions from the health2 centers to another location, or is it that3 they just can't get prescriptions?4 I'm worried about those issues.5

I think we, in the6 Department, certainly share your concern.7

Thank8 you.9

I brought with me,10 and happy to make available to the Chair,11 the federal regulations.12 The federal government allows us13 to be what are call federally qualified14 lookalike health centers. That means that15 payments from the federal government and16 the State for patients who have Medicare17 and Medicaid are enhanced to equal our18 costs for the services that those people19 receive.20 For people who are uninsured, we21 are required, by taking those federal22 dollars and State dollars, to have a fee23 schedule and to collect from those who are24 uninsured.25 27 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

Is this2 new money? Is this additional money? Is3 it some new law where, all of a sudden,4 you got to charge people?5

So it has always6 been a federal requirement. We have had a7 fee schedule; we haven't collected. And8 there has been, I would say, increasing9 issue around this.10 The other federally qualified11 health centers in Philadelphia all have12 fee schedules, and they charge patients.13 We, as the safety net provider, agreeing14 with you, are setting our fees lower than15 the other centers in the City in order to16 provide the minimum barrier to people. and17 --18

But if19 we haven't -- if you said it's always been20 there and we haven't collected, why are we21 doing it now, when the economy is bad and22 people can least afford it?23

I agree with you.24 Two issues. One is --25 28 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

I'm2 sure -- I bet you it's a Bush initiative.3 Sorry. I couldn't help that.4

-- go generate5 revenue, which we need to keep the health6 centers open; and, two, to meet the7 federal requirement.8

Well,9 we don't agree with it. And I'm sure I10 speak for my colleagues.11 It's kind of like full tax12 valuation; they always said that too13 because it's on the books and we haven't14 done it. And I'm sure that I speak for15 everyone in Council when I say if you16 haven't done it, we don't need you to17 start it now, when people are in such18 trouble.19 Can you tell me about the20 over-the-counter medication as well?21

Absolutely. So.22 We provide for free over-the-23 counter medications. And as part of the24 budget reduction, rather than cutting25 29 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 services and rather than cutting2 prescription medications, we are removing3 them. They're accessible to people;4 people would need to purchase them in a5 drugstore, as others do for over-the-6 counter medications.7

So this8 is a part of that same initiative?9

It is.10

Well,11 let me say, for $2 million, when we spend12 billions, I'm sure that I speak for every13 member of City Council when I say we don't14 agree with either initiative. Ever since15 I heard it, I've been frightened to death.16 I mean, we're worried about the17 long lines; a person having a toothache18 can't get seen for two months and people19 in pain, but we just can't. I mean, some20 things moral commitment dictates when it21 comes to people in need. Some things, we22 as leaders, have to decide that we're not23 going to do. Some things mean more.24 And in a multi-million-dollar25 30 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 budget to save $2 million and charge2 people across the counter and to charge3 them prescriptions, it's just not4 something that we as a Council agree with.5 And we hope that, in your budget6 deliberations, that you may reconsider7 this because I'm sure that everybody on8 Council agrees with me, and there will be9 kickback about it if you don't reconsider10 it.11 Thank you, thank you. And thank12 you, Councilman for letting me go.13 (Applause.)14

Thank15 you.16 The Chair now recognizes17 Councilman Greenlee.18

Thank you,19 Madam President.20 Good morning, gentlemen.21

Good morning.22

Staying on23 that same line, I had a couple questions24 about health centers, but particularly on25 31 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 the line that Councilwoman Blackwell was2 asking.3 On these federal requirements,4 has the federal government gone after the5 City at all for not collecting this money?6

So I would say it7 has been noted. They have not charged us8 penalties.9

Mm-hmm.10 Has this been recently, since a new11 administration took over?12

Yes.13

Since the14 new administration took over? Let me put15 it that way it has.16

Yes.17

It has,18 all right.19 I mean, in all fairness, and I'm20 not even going to get into, you know, the21 yea or nay of this, isn't the real reason,22 though, is the City's fiscal problem? I23 mean, isn't that why it's being promoted24 now?25 32 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

I will say that --2

Yeah,3 okay.4

-- I think we need5 to address the fiscal problem.6

No. I7 understand.8

I think, at the9 same time --10

Yeah.11

-- we will need to12 address this problem at some point.13

I hear14 you, okay. But, I mean, really, it's15 bringing it to the fore because we have a16 money problem right now. Okay.17 Along those same lines, what is18 the kind of, if I could call it, mechanism19 of doing this? Are people informed --20 well, is the plan -- saying it will go21 forward, is it people will be notified22 ahead of time what they have to bring in,23 but they will not be able to partake of24 the service unless they pay up front? Is25 33 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 that basically how you're seeing it?2

I think that's the3 basic.4

Mm-hmm.5

The devil of the6 detail here is, we don't want to deny7 someone who needs urgent service that8 service.9

Mm-hmm.10

And we also don't11 want to put the employees in the health12 centers in a position of making life-and-13 death determination if they're not14 qualified to do so.15 So, one, we need clear policy;16 and, two, we must notify people. So both17 at the time that appointments are made and18 at the time of arrival and before we19 implement this at a last visit, we will20 need to notify people.21 We also are intent on not22 collecting cash but using some sort of23 smart card technology so that people can24 easily pay, efficiently pay, but our25 34 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 workers won't have to handle cash.2

Okay. And3 that's still, I assume, being worked out.4

It is.5

Okay.6 Along the lines of health centers also,7 speaking of lines, I guess, what is the --8 has the waiting time for service how much9 -- you know, I've asked that before. I10 think a lot of people have that in -- how11 much has that changed?12 Hopefully, you're going to tell13 me in a positive manner, but whatever.14

I'm going to tell15 you that last year, we had about a 516 percent increase in the budget for the17 health centers.18

Right.19

And our numbers20 have gone up even more than that.21

Right.22

So we're providing23 more service, but what it's meant is that24 we've not made much progress on waiting25 35 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 time.2 We've made progress on waiting3 time for prescriptions because we've been4 able to fill vacancies.5

Mm-hmm.6

But in terms of7 the waiting time overall in the system, it8 looked like the we were making progress, I9 have to say, through the spring of last10 year, but the numbers of people needing11 service have gone up.12 And as a result, our waiting13 time has gone up.14

Can you15 give anything to the Council President as16 far as the information?17

Yes. I have it18 with me today.19

Okay.20

We can go21 through it, but I'll provide it.22

No, we23 don't have to go through each one, but I24 will ask about one particularly since it25 36 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 seems to get a lot of con -- District2 Center 10.3 And I know a lot of that is4 just -- it's -- the catchment area, if you5 will, is so large. But could you just go6 into that a little bit as far as what the7 timeframe problems are?8

And,9 Doctor, while your book is open --10

Yes.11

-- can12 you tell us how long one has to wait for13 an initial visit?14

I can, I can tell15 you. I can tell you that it is about six16 months.17

Six18 months' wait?19

For --20

Is that21 for District 10?22

For a new-patient23 visit at District 10, it's been six24 months.25 37 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

Wow.2

Since before we3 came into office.4

Is5 that for the initial --6

It is.7

For8 the initial visit?9

It is.10

Six11 months.12

Wow.13 What -- and is there -- I don't want to be14 taking away from other places, you know,15 'cause we'll get in -- being Councilmen-16 at-large, I'll get yelled at by somebody,17 but that sounds -- is that inordinately18 longer than other districts?19

It is --20

What21 can --22

-- by far.23

I'm24 curious to know --25 38 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

Sure.2

I'm3 sorry. I don't mean to interrupt you.4

No, go5 ahead, go ahead.6

What7 I'm curious to know, is that initial visit8 of six months just in the 10th District?9

Yes.10

What11 is it throughout the City?12

So I have it. I'm13 sorry for the delay.14 It is about 190 days at Health15 Center 10 for a new visit -- for an adult,16 not a child.17 And Health Center 2, in the18 second Councilmatic District, is 18 days.19 Health Center 3, 41.20 Health Center 4, 96.21 Health Center 5, 4.22 Health Center 6, 63.23 Health Center 9, 5.24 Health Center 10, 190.25 39 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 In the Strawberry Mansion Health2 Center, 40, for an average of 58 days.3 We encourage people, when we4 schedule appointments, to use one of the5 other health centers. We also give them6 information about other health in their7 area.8 The issue with Health Center 109 is twofold: One is that there aren't many10 alternatives in the areas.11

Right.12

And two is that13 the number of uninsured in that part of14 the City is growing more rapidly than15 anywhere else.16 So we have opened additional17 hours. We are looking carefully at18 staffing. And the hospital tax dollars19 will go to Health Center 10 in particular20 to try to meet demand.21

And,22 again, I know --23

Thank24 you.25 40 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

-- that,2 you know, it's --3 (Timer bell rings.)4

-- I just5 was wondering if there's any6 possibility -- and I know I could get in7 trouble with other areas of -- you know,8 because that's such a big difference -- of9 some way readjusting something. I mean,10 that's easy for me to say, I know.11

Part of the issue12 is space.13

Uh-huh,14 okay.15

So we are --16

And I've17 been up there, I know.18

We are utilizing19 every nook and cranny.20

Okay.21

And looking at22 ways to improve efficiency. And, in fact,23 Health Center 10 has done a very good job24 in terms of working on improvements to25 41 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 efficiency.2

Mm-hmm.3

But the physical4 plant there is limitation. It was built5 without the anticipation that things would6 grow as quickly or as much in the7 northeastern part of the City,8 particularly for uninsured individuals.9

Mm-hmm.10

So we're caught by11 geography at the moment.12

Okay, all13 right. Thank you.14 Thank you, Madam President.15

You're16 welcome.17 The Chair recognizes Councilman18 Green.19

Thank you,20 Madam Chair.21 With respect to the President's22 earlier question, in addition to what else23 you're going to provide in response, if24 you could identify revenue expenses for25 42 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 each district health center, identify --2 and I just want to be clear about what it3 is I'm looking for.4 Identify any additional5 reimbursements from the state and federal6 governments that would be placed in7 jeopardy due to a net loss of patient8 visits or otherwise if the City closed the9 health center.10 In other words, using the11 revenue projections on Pages 13 and 18 of12 the Operating Budget Summary, detail the13 potential losses in revenue categories by14 health center from closing health centers.15 Okay.16

I can say that17 there shouldn't be any jeopardy in terms18 of additional federal or state dollars,19 but we would be happy to provide the rest20 of it.21

Okay, because22 we don't get reimbursed by --23

It doesn't -- we24 don't get reimbursed in that way.25 43 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

When patient2 visits aren't a factor?3

Patient visits4 are, but it's -- I maybe misunderstood.5 I'm glad I'm clarifying.6

Okay.7

We get paid per8 visit, or capitated per head, for someone9 over the course of the year, but I think10 the word you had used is "additional."11 And I just want to make sure I understand12 that.13 There is no --14

Total15 revenue.16

We have that.17

Okay. Just18 out of curiosity, if part of the problem19 at District Health Center 10 is no nooks20 and crannies left in the building, have21 you looked at selling that building and22 relocating to a different location?23

We have not.24

Do you think25 44 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 that maybe is a good idea?2

I think it would3 be a good idea at a time when we have4 additional resources.5

Well --6

So it certainly is7 something that we're exploring with anyone8 we can find who might be able to provide9 us with additional resources, but I don't10 know if the best --11

Do we know12 what the building's worth?13

We do. We have a14 PICA assessment of the building. And15 we've used that PICA assessment, working16 with Property, to look at all of the17 Health Department property.18 One of the questions that you19 might ask me next year, and we could talk20 about, is whether the solution for the21 Northeast is to close and reopen a larger22 health center or to have a second23 location. And I don't know the answer to24 that.25 45 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 I will say that one of the2 activities I have undertaken this year is3 to work with other providers of care in4 the City to encourage them to open other5 sites in the Northeast, because we're not6 the only potential provider of services.7 And there are others who have access to8 capital in other ways.9 I will say that we are pleased10 that Holy Redeemer Hospital has recently11 opened a new primary-care site in the12 Northeast. It has not been open long13 enough for us to see if it makes a14 difference for our waiting time.15 But we have actively sought16 partners based on the analysis, which I17 talked about here last year, in areas of18 the City where we know there's19 under-service, to assure that when20 providers are looking for new sites, they21 try to target those sites, to places where22 there's under-service in the City.23

And are we24 losing the opportunity to open our own25 46 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 sites?2 In other words, health centers,3 it would appear, based on the cost of the4 health center, compared to the amount of5 reimbursement we get, which is over6 $70 million for our health centers, if7 they cost 2.5 million to staff, which is8 what the benefit of closing one will get9 you, according to your testimony, maybe we10 ought to consider opening more health11 centers?12 I mean, we do have a capital13 budget, which is separate from our14 operating budget. They're separate15 dollars. It's surprising to me that we16 would not want that extra money in our17 health department versus, you know,18 encouraging other -- you know, we're19 either going to be in the health center20 business or not.21 And if it's kind of profitable22 compared to the -- the cost compared to23 the reimbursement we get, then I'm24 confused.25 47 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

I'm -- I don't --2 I'm -- I just want to be clear.3

Yeah.4

So the cost to the5 City, net cost, is about 2.3 million in6 the budget. The cost to run a health7 center varies, but the City doesn't make8 money on the --9

Okay. We10 lose 2.3 million on average on each health11 center.12

That's correct.13

Okay, I14 understand.15

We're not a16 profit-making entity --17

I got it.18

-- in the health-19 center business.20

Thank you,21 okay. But I still looking forward to that22 detail.23

Absolutely.24

In FY '08,25 48 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 there were 666 full-time employees.2 Leaving out overtime and bonuses, et3 cetera, the Class 100 expense was4 31.1 million.5 In FY '09, there were 757 budget6 full-time positions, an increase of 91.7 As of January 2009, only 662 --8 (Timer bell rings.)9

-- of these10 positions were filled. The estimated11 Class 100 spend for salaries, again12 leaving out overtime, bonuses and so on,13 for FY '09 is 34.6 million.14 As of January '09, we were down15 4, but the FY '09 spend is up $3.5 million16 versus '08.17 Can you explain that to me?18

I believe, if I'm19 following you correctly, it has to do with20 the hospital assessment.21 So the hospital assessment was22 booked for half a year in Fiscal Year '0923 and a full year in Fiscal '10, because we24 wanted to make sure that we had the25 49 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 authorization in here. And we've not2 received the revenue, so we've not3 increased the expenses, but we have the4 positions here so that Council could5 approve them should the money come6 through.7 Is that --8

Well, how are9 we spending -- it looks like we are10 actually going to spend 3.5 million more.11 So, like, what you're answering is a12 revenue question.13 The real question is: We're14 spending 3.5 million more even though we15 have 4 fewer positions.16

So the issue here17 is, we've booked both the revenue and the18 expenses for the hospital tax. So what19 you see is the increase in positions and20 the increase in anticipated expenditure21 that would match the revenue that would22 come in from the tax.23 We took half of it, half of the24 number for Fiscal Year '09 and a full25 50 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 year's worth for '10.2 Is that...3

Well,4 according to what I have in front of me,5 you are actually going to spend, for '09,6 3.5 million more than you spent. Like the7 expenditure, based on the number of8 positions, 662, not the fully budgeted,9 the expenditure, based on 662, 3.5 million10 more than you were spending in '08, which11 is at 666.12 So how can we spend more money13 with four fewer people? That's the14 question. This is what you are actually15 going to spend according to the increment16 line.17

So part of the18 issue here has to do with filled positions19 versus budgeted positions.20

Right.21

So the Health22 Department has had in the past a large23 number, as have many other departments,24 but Health in particular, of unfilled25 51 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 positions. So the budgeted positions,2 these are actual.3

I'm talking4 actual to actual.5

Okay.6

Actual '08,7 666; actual '09, 662. We're spending8 3.5 million more.9

Okay. The Fiscal10 Year '09 estimated obligation is the11 target -- or the mid-year adjusted budget12 number at this point. That includes the13 revenue from the hospital tax.14

And includes15 the...16

So --17

Do we know18 we're not getting the revenue from the19 hospital tax?20

So what you see is21 -- let me -- I'll walk you through.22 So, you see 757 budgeted23 positions in Fiscal Year '09.24

Right.25 52 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

That matches the2 34,654,664 in budgeted revenue essentially3 at mid-year.4

That's a5 budget expense in Class 100.6

Excuse me,7 budgeted expense, which is matched8 essentially incrementally to the revenue9 coming in from the hospital tax.10 You then see the incremental run11 on personnel, 662. So that the 662 will12 match the actual expense for the13 Department at the end of the year.14 If we receive the hospital tax15 --16

Does the 66217 number include employees from the hospital18 tax?19

It does not.20

Well, why are21 you including revenue from the hospital?22 If it doesn't include it, then it is23 apples to apples, the hospital tax is24 irrelevant. You're increasing spending25 53 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 3.5 million.2

I understand both3 the confusing nature of it. I can tell4 you the -- what it represents. I can't5 tell you why it represents it that way in6 terms of history of budgeting for the7 City, but Mr. Lemmo may be able to help us8 both.9

I'm Carmen Lemmo,10 Deputy Health Commissioner.11 You're absolutely right. The12 number at 34-million-634, it is an13 estimated number. It's not necessarily a14 natural number and has nothing to do with15 the hospital tax, is not even associated16 with that. That is plain General Fund17 that you're referring to.18

Right.19 General Fund numbers.20

The reason is that21 for Fiscal '08, actual is obligations.22 The (indiscernible) were a lot lower than23 we're currently estimating.24 If you look at the 34 million,25 54 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 it's really a projected number. We expect2 that the numbers to go up at year-end to3 close to maybe, like, 700 positions in4 terms of total numbers.5 So we are -- in addition to6 that, what happened between Fiscal Year7 '08 and Fiscal Year '09, there was a lot8 of salary increases for doctors, medicals,9 pharmacists, okay? Which, okay, were not10 necessarily reflected in Fiscal Year '08,11 but most of them were reflected in Fiscal12 Year '09. So that's another reason why we13 have a large increase in terms of dollars.14

Can you15 provide a detailed breakdown of what you16 expect of the actual numbers that you're17 going to spend in '09, what positions you18 anticipate will be filled by the end of19 the year.20 And, I guess, what your -- based21 on your current spend right now, with the22 number of employees you have, if you were23 to maintain that number through the end of24 the year, how much you'd actually spend in25 55 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 Class 100 Funds.2

I could actually3 give it to you now if you want it.4

All right.5

For the end of the6 year, we expected it to be 713 positions.7 Hopefully that we expect a lot of these8 positions to be increasing between the9 November numbers, which was in the budget10 document, versus year-end numbers.11

Yeah. You're12 not giving me the number I want, so why13 don't you just reply in writing.14 The number I want is: Assuming15 your current staffing level through the16 end of the year, what will you actually17 spend?18

Okay.19

Okay.20

We can give you21 that.22

And then you23 can show me what positions you plan to24 hire and other stuff but --25 56 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

Yeah, based on our2 current level, the actual estimate will be3 lower than what is right now.4

Thank you,5 Madam Chair.6

Thank7 you.8 The Chair recognizes9 Councilwoman Brown.10

Thank you,11 Madam President.12 Good morning, gentlemen.13

Good morning.14

I would15 like to continue with on this round of16 questioning the questioning from17 Councilman W. Wilson Goode --18

Yes.19

-- around20 our -- and I quote him, to dig into what21 is happening with the entire22 subcontracting picture across departments.23 And we were under -- well, we asked that24 all departments come prepared to tell us25 57 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 not only the number of contracts and the2 value of the contracts, but also the3 number of prime contracts and the number4 of subcontracts in the material that you5 send us.6 So we want to be clear that you7 understand what we're looking for.8

We do.9

And this is10 one clear reason why. I have here a11 document of 37 pages, which are contract12 summary informations. And of the 3713 pages, 29 cite the vendor name PHMC. Of14 these, there is no indication of MBE/WBE15 participation.16

In subcontracts?17

Yes.18

Yes.19

So this20 becomes an example of why we need and want21 that information.22 On of your budget23 material, there are major cuts in prenatal24 care:25 58 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 $281,000 to Temple Physicians.2 $291,000 to Tenet Health.3 $129,000 to University of Penn.4 And $381,000 to Albert Einstein5 Medical Center.6 Can you tell us now that these7 services are no longer available at these8 institutions for prenatal care, how and9 what is the Department doing with regards10 to referring that constituency to other11 programs?12

I'm sorry,13 Councilwoman. Can you show me from where14 you're --15

This is on16 of the Budget.17

Okay.18

Section 46.19

So this is --20

And this21 lists, um...22

I'm happy to --23

... the24 prenatal services.25 59 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

Yeah. This2 doesn't actually represent a reduction in3 prenatal services; it represents a4 movement of the responsibility from one5 area in the Health Department, the6 Maternal, Child and Family Health, to7 Ambulatory Services.8

To9 Ambulatory.10

So under11 Ambulatory now, we've moved these12 contracts to provide prenatal care13 services.14

Oh, okay.15

We haven't removed16 them, reduced them, made them less17 accessible. In fact, we think they're18 hopefully more accessible because now19 they're integrated in between the two20 areas -- general care and prenatal care.21

So -- okay.22 And so those families are still being23 taken care of.24

Yes.25 60 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

Thank you.2 I know an expansion of lead3 prevention included in the Budget as a4 result of a new grant of revenue. Update5 us, if you will, on what's been happening6 with the lead prevention efforts.7

I'd be happy to.8 So we currently have about 1559 homes waiting for lead abatement.10

You said it11 was 155?12

Yes, ma'am.13 That represents the good news14 because we were, at the middle of this15 year, waiting for the housing urban16 development agency from Washington to let17 us know what our allocation was going to18 be and whether we were going to be funded.19 So we, I'm proud to say, have20 received the $7 million grant that's21 referenced in my testimony. That will22 allow us to continue abatement services.23 And we have, as you know, a24 sufficiently large number of homes in the25 61 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 City of Philadelphia which are not2 lead-free.3

That's4 right.5

And that we are6 going to have to continue providing7 abatement services for a very long period8 of time.9 We have a waiting list largely10 because we have to know clear title, owner11 of the property, and so forth.12

Okay.13

So it's14 administrative at the moment --15

Okay.16

-- as much as it17 is resource-related.18 And as homes are cleared, we are19 able to abate them promptly.20

What are21 the glitches in the administrative?22

We need to know23 who owns the building often, and we need24 permission of the owner of the building to25 62 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 do abatement. And we need to relocate the2 family, and they have to be willing to be3 relocated.4 So all of that takes a bit of5 time.6

I see.7

And during that8 time, we both educate the family, as you9 know.10

Mm-hmm.11

We help them with12 cleaning, to remove as much lead dust as13 possible.14 But the actual abatement is a15 fairly protracted process that involves16 many steps in order to assure that we have17 the right permission and we have the18 family out so that children aren't exposed19 to the increase in lead dust that occurs20 during the abatement process.21

Okay.22 According to the Center for Disease23 Control, the number-one cause of death for24 African-American women between the ages of25 63 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 24 and 35 is HIV AIDS.2 On of your budget,3 entitled, "AIDS Education Counseling and4 Medical Services," cuts are shown in a5 number of those areas -- rapid HIV6 testing, medical-care facilities, and7 counseling and referral services.8 Please speak to us as to how the9 Department -- well, let me say this also.10 On Monday, we learned that the Prison11 systems spends 60 percent of its12 prescription drug money --13 (Timer bell rings.)14

-- on15 HIV/AIDS medication.16 So just share with us how and17 what the Department has in mind to address18 what will now be these services being cut19 from your budget?20

All right. So21 what you are looking at isn't actually22 HIV-related. It's under disease control23 --24

Page?25 64 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

156.2

156.3

And you see4 (indiscernible) at the top.5

Yes.6

AIDS activities.7 And down below is Disease Control.8

Yes.9

So what these cuts10 represent is, in the rebalancing, there11 were a number of historic positions in the12 Health Department.13

A number of14 what?15

Historic positions16 related to contagion and quarantine,17 things like that, which we removed.18

Okay.19

And that's what20 this represents.21 I have good news. The Health22 Resources and Services Administration is23 here, going through its audit and24 oversight of our program for HIV services,25 65 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 and we've been just been informed that our2 Ryan White Part A allocation is going to3 be increased by about three-quarters of a4 million dollars for the next year, which5 is stupendous news; it will get us up to6 about $21 million in funding.7 So, actually, instead of8 reducing HIV services, I'm happy to say we9 should be able to improve our HIV10 services.11

And thereby12 capture these services, as stipulated.13

No, there's no14 reduction. This budget shows no reduction15 in HIV services.16 What you're looking at in terms17 of line items here are in Disease Control,18 which is different from HIV. These have19 to do with historic positions in both20 tuberculosis and STD control, which are21 not needed, not used.22

Oh, okay.23

We kept them in a24 sense in reserve. And when we rebalanced,25 66 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 we decided that historically, we hadn't2 used them, we didn't need to, so they've3 been eliminated.4

Oh, okay.5

So that doesn't6 affect HIV care, it doesn't affect HIV7 services, it doesn't affect actually STD8 or TB services.9

Okay.10 Thank you.11 The bell did ring, didn't it?12

Yes,13 it did.14

Thank you,15 Madam Chair.16

The17 Chair recognizes Councilwoman Tasco.18

Thank you.19 Good morning.20

Good morning.21

How you22 doing.23 I have a lot of questions, but I24 want to go back to this issue of the25 67 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 federally qualified centers. Could you2 explain what these centers are and why3 they were created, and then why we want to4 look like them. Is there an advantage?5

Okay.6

Is there an7 advantage?8

I'd be happy to --9

And is10 there an advantage to being a federally11 qualified lookalike? What are the12 advantages and disadvantages?13 COUNCIL PRESIDENT VERNA:14 Councilwoman, if you would please speak15 into your mic.16

I'm sorry.17 I forget that all the time. Okay.18

Okay. So the19 federal government created -- and I20 apologize for not knowing whether it was21 in the '60s or '70s -- a funding stream to22 stabilize health provision in particularly23 underserved communities. They included24 both rural and urban, although they were25 68 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 particularly, at that time, focused on2 rural, but urban communities were able to3 have them.4 Those are ideally health centers5 that serve a community of people who don't6 have a lot of other health places to go,7 particularly those who are poor. And they8 have a board of folks, a private9 enterprise with a board, that controls the10 fiduciary decision-making and is11 responsible fiduciarily for any profit or12 loss of one of those health centers.13

So it's14 profit-making.15

Well, they usually16 break even.17

Mm-hmm18 mm-hmm.19

But they have to20 break even. And they're frequent --21 they're nonprofit. And they frequently22 raise charitable dollars as well as using23 existing resources.24 The federal government, in order25 69 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 to help those centers break even, allowed2 them, when they billed for Medicare and3 Medicaid services, to actually be paid at4 their cost for those services, which is5 considerably higher than another private6 provider would be paid for Medicare or7 Medicaid primary services.8 So you get more dollars every9 time you see a patient who has Medicare10 and Medicaid insurance. And, in fact,11 that amount is determined by the cost to12 deliver care at the site.13

Mm-hmm.14

But in addition,15 those sites are directly encouraged by the16 federal government to provide care for17 those who are uninsured.18 The federal government says, We,19 the federal government, can't pay for care20 for the uninsured. We can help you with21 those who are insured by public insurance,22 but if you are uninsured, you must pay23 something.24 Those whose incomes are less25 70 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 than a hundred percent of the poverty2 level should be charged what the3 regulation says is nominal fee. If your4 income is between 100 and 200 percent of5 poverty, it should be an increment on6 that. And above 200 percent of poverty,7 it should be the full cost.8 So it should be the equivalent9 of what the federal government is paying10 for Medicare and Medicaid services.11 There are a number of agencies12 around the country, notably public13 agencies, where the control, the fiscal14 control, isn't housed in a community15 board; it's housed in the city.16

Mm-hmm.17

And as a result,18 in order to allow these entities to have19 the same benefit of enhanced payment,20 cost-based payment, for Medicare and21 Medicaid, the federal government has22 labeled those centers "lookalikes."23

Mm-hmm.24

We, as a public25 71 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 entity financially responsible, even2 though each health center has a board, and3 the board helps in decision-making, those4 individuals as a board are not financially5 responsible for the health centers. And6 so, we are called lookalikes. The other7 difference is that non-lookalikes, real8 federally-qualified health centers,9 receive dollars for capital from the10 federal government and some dollars for11 operations. We're not eligible for those12 dollars because our centers are lookalike13 centers.14

Well, you15 talked about -- and I'm going back to the16 question that Councilwoman Blackwell17 raised about the -- about the pharmacy and18 not being able to provide the medication19 to the clients.20 And is that a -- they can't --21 the federal qualified agencies can't22 provide --23

That's not the24 issue. That is a decision that we made25 72 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 for over-the-counter medications, which2 are available in pharmacies and other3 places without a prescription. And we4 made that decision because of the budget5 constraints.6 We receive a subset -- we7 receive a special rate for pharmaceuticals8 that are by prescription, non-over-the-9 counter ones. So, for instance, blood10 pressure medications, we receive a special11 rate called 340B rates, and we can buy12 them at a lower rate, and we give them to13 people at no charge.14 We're not proposing to change15 that; we will still give all prescription16 medications to folks who need them, at no17 charge.18 But instead of continuing to19 purchase and distribute over-the-counter20 medications, since they're widely21 available at pharmacies and people don't22 need prescriptions for them, we made the23 decision that rather than closing a health24 center, we would economize in that way.25 73 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 And so, we're removing over-the- counter2 medications for free at our health3 centers.4 (Timer bell rings.)5

Okay, thank6 you. I'll come back.7

Thank8 you.9 The Chair recognizes Councilman10 Goode.11

Thank you,12 Madam President.13 Dr. Schwarz, continuing on the14 other line of questioning previously on15 business diversity, pursuant to Bill No.16 060855, which I cited before, in June of17 2008, the Minority Business Enterprise18 Council, under the direction of the19 Finance Director, which is now the Office20 of Economic Opportunity, produced annual21 participation goals related to business22 diversity.23 Are you familiar with those24 goals?25 74 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

Yes.2

Excuse me?3

Yes.4

And so, the5 overall participation goal, in terms of6 disadvantaged businesses, was 25 to 287 percent, which I believe your particular8 department, in terms of the Health9 Department, outperformed considerably.10

Yes.11

But were you12 aware that there was a goal in terms of13 for-profit opportunities for disadvantaged14 businesses in the City nonprofit15 contracts?16

Yes.17

And that goal18 was 5 percent.19

Yes.20

But you are21 not aware of how close you are to that22 5 percent or whether you've exceeded that23 5 percent yet.24

I don't -- I don't25 75 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 have all of the information yet. We've2 requested it, but I don't have all of the3 information, and I don't want to mislead4 Council.5

Okay. The6 Office of Supportive Housing, in the Class7 200, has $31 million. The Health8 Department, the Class 200, has $689 million. DHS, in Class 200, has10 $487 million.11 In addition to providing us with12 the information regarding Fiscal Year '09,13 as the Office of Economic Opportunity is14 finalizing its participation goal for15 Fiscal Year '10, will you be setting goals16 for those nonprofit contracts?17

Yes.18

Okay. The19 last question, then, is: At what point20 will we become aware of those goals? And21 are those goals that you would negotiate22 with the Office of Economic Opportunity or23 will you be setting them yourself?24

My understanding25 76 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 is that we will likely discuss them with2 OEO, but I don't know that for sure.3

And do you4 know what portion of nonprofit contracting5 you're responsible for?6 In terms of nonprofit7 contracting in the City, there is that8 which is done through the Health9 Department; or, in terms of Health and10 Opportunity, that which is done in terms11 of Community Development.12 In terms of the whole scale of13 nonprofit contracts --14

Yeah.15

-- what16 portion do you think, in your capacity as17 Deputy Mayor for Health and Opportunity,18 are you responsible for?19

For nonprofits, I20 know it's a high proportion, but I don't21 know a number.22

Okay. Thank23 you.24 Thank you, Madam President.25 77 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

You're2 welcome.3 The Chair recognizes Councilman4 Rizzo.5

Thank you,6 Madam Chair.7 Good morning.8

Good morning.9

I just have a10 short question, more so an update. And11 maybe I should know this, but I don't.12 There was conversation recently13 or a few months back, maybe more months14 than I can remember, that the South Broad15 Street health center would be closing16 because there was some suggestion that17 there was going to be a nonprofit moving18 into that location.19 Could you give us an update?20 Was that actually being considered, the21 closing of the South Broad health center?22 And what is happening?23

I appreciate the24 follow-up, because I think you and I25 78 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 talked about this last year in my Council2 testimony.3 You may know that there was a4 report of --5

When I start6 remembering -- forgetting --7

No, I appreciate8 it.9 The Controller's Office actually10 produced a report -- and my memory is bad11 as to precisely when it came out, but I12 would say in the summer, but I'm not -- I13 can't guarantee it -- in which they14 recommended that we sell the Health Center15 1, which is actually the headquarters for16 many of the offices within the Health17 Department, and it has the STD Clinic for18 the City. They recommended we sell the19 health center and relocate, and they20 believed it was a cost-saving measure.21 We have responded and actually22 spoken with the Controller and spoken with23 others because that assessment didn't24 include the expense for moving. And when25 79 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 we include the expense for moving, it2 actually is more expensive to move that3 health center and the whole set of offices4 to sell the property.5 But Public Property knows of6 this issue. There have been a number of7 people who have expressed some interest.8 The price of real estate in Center City is9 holding fairly well. It still doesn't10 cover adequately the cost for moving all11 of the facility, all of the functions out.12 So we're well aware of it. We13 are working with Public Property on that14 issue, but at the moment, there is no plan15 to sell the health center or sell the16 building.17

So I got it18 right. If, in fact, that is something19 that would be pursued, you're not talking20 about closing; you're talking about21 relocating from the valuable South Broad22 Avenue of the Arts location to some other23 location in the area?24

That is correct.25 80 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

Is that the2 commitment?3

That is correct.4

Thank you.5 Thank you, Madam Chair.6

The7 Chair recognizes Councilman Kenney.8

As soon as I9 get a microphone... Thank you.10 Doctor --11

Good morning.12

-- we had a13 recent discussion about my not-so-long-ago14 visit to an emergency room in15 Philadelphia, CHOP, with my daughter. And16 after five, six hours there, which is kind17 of the normal in an emergency room on a18 Saturday afternoon, just being able to19 view the people coming and going, I20 realized that probably 90, 95 percent of21 the people were coming in there with their22 sick children, and the children were, in23 fact, sick, but it was not a emergency-24 room event. And people are coming there25 81 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 because they really have nowhere else to2 go.3 What initiatives can the Health4 Department, the hospitals, the insurance5 companies bring to bear with getting6 people primary care for their children,7 whether it's a health center, whether it's8 a private doc, in the neighborhood, or9 whether it's some other form, to get these10 folks out of the emergency room and the11 expense associated with it and get the12 care that their children need when they13 have the flu or a cold or whatever.14

I appreciate the15 question, and I think it is very much a16 need.17 Nationally, we're not different18 from the rest of the country. There is, I19 think, a crisis at the moment in emergency20 care. And it's not what would ordinarily21 be called routine well care. It's acute,22 but not emergency-level, care.23

Right.24

There are a number25 82 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 of for-profit entities, so a number of2 pharmacies like Walgreen's and a number of3 other companies like Wal-Mart, which are4 beginning to place nurse practitioners in5 those sites to provide an alternative to6 emergency rooms and provide acute care in7 those locations.8 One of the substantial issues9 with providing acute care is that much of10 primary care in this country has become11 capitated, which means providers are paid12 in a sense one payment for a month or a13 year to provide care, and it's meant to14 include routine acute care. But the15 policing of that isn't terribly rigorous.16 And so, there are a fair number17 of Americans now who have health coverage18 to go for primary care and health coverage19 for emergency care, but acute care falls20 somewhere in the middle. Figuring out how21 to finance just acute care is difficult.22 It comes at the same time that23 we see that, nationally, there is a24 increasing lack of primary-care providers,25 83 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 so that coming up with solutions to this2 is going to be particularly difficult.3 And since the decision is to do4 no harm first, people are permitted to go5 to emergency rooms for non-emergency, but6 acute-care, needs.7

I recognize8 that we're constrained 'cause of HIPAA and9 a number of other federal regulations on10 the sharing of information.11 But is there some way to figure12 out or at least have people agree that13 when they go through an emergency room for14 a child with the flu, that we can somehow15 follow up with them to get them into a16 health center the next time or to get them17 to a primary-care doc in their community18 or to get them signed up for medical19 benefits through the State?20 I mean, I recognize again the21 constraints of the federal law, but there22 must be something that can be done to23 access those folks.24

If people have a25 84 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 primary-care provider, there's not very2 much actually HIPAA constraint.3

Okay.4

So emergency rooms5 do often fax emergency-room visits to6 health centers. It's not enough, it's not7 always, it's not every emergency room, but8 many are doing it and more are.9

But isn't10 that financially in their interest to do11 that? I mean it would seem that if you12 treat the child in an emergency-room13 setting and, you know, the child obviously14 needs to see a doctor, the next time15 keeping that child or having that parent16 having an alternative to that emergency17 room would seem to be in the hospital's18 best interest and, certainly, secondarily,19 in the insurance company's best interest20 and in the State's best interest of their21 own Medicaid.22

It's very much in23 the insurance company's best interest.24 It's very much in the child's best25 85 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 interest. For the hospitals, it depends2 on how busy the emergency room is and what3 --4

Well, CHOP,5 as you know, is pretty busy --6

It's very busy.7

-- all the8 time.9

CHOP actually, I10 happen to know, faxes its emergency-room11 visit sheets or delivers them12 electronically to every one of the13 primary-care providers from where children14 come.15

Relative to16 the 3-1-1, when we were doing research on17 3-1-1 and what the Chicago -- I attended a18 City STAT kind of situation at the health19 department, and one of the things that20 came about as a result of the City STAT21 data was that one health center wound up22 treating more people with less staff for23 certain behavioral-health issues.24 And as a result of the City STAT25 86 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 meeting, they determined that the health2 center with the less number of employees3 saw more people because they developed a4 group therapy session for some of the5 behavioral-health issues and were able to6 see more people, and the sharing of that7 information between health center -- the8 people who run the health centers was9 critical in sharing that best practice.10 Have you been able to use data11 and correlate data yet on 3-1-1 City STAT12 issues that have helped you kind of13 streamline or change practices?14

We have15 independent information that we collect on16 each visit.17 3-1-1, to date, because we have18 a center for scheduling appointments for19 the Health Department, that doesn't make20 sense financially to put into 3-1-1.21

Mm-hmm.22

We collect it from23 our own data sources.24 (Timer bell rings.)25 87 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

But do you2 conduct City STAT-type meetings relative3 to people who are running health centers?4

We've actually had5 a number of PhillyStat sessions on our6 health centers.7

Okay.8

And it's helped us9 to look at a number of, I would say,10 critical variables in the running of those11 health centers.12

Fine.13

And will hopefully14 improve care.15

I don't want16 to go over time. Thank you.17

Thank you.18

The19 Chair recognizes Councilman Jones.20

Thank you,21 Madam President.22 Doctor, how are you?23

Good morning.24

I will25 88 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 dispense with my customary citing that2 there are no City-owned health districts3 in the 4th Councilmatic District. I will4 switch, however, to ask how we can better,5 more effectively get coverage for the6 155,000 people in my district and7 throughout the City.8 I will raise the question of the9 use -- and I don't know if you had a10 opportunity to read the telenursing report11 that was done by the City Controller12 recently.13

I haven't read it.14 I actually heard it cited just yesterday15 for the first time.16

Well, in that17 report, it cites how telenursing, which is18 similar in respects to telemedicine, could19 be used to cut costs by way of EMS travel,20 by way of efficiencies of transmission of21 data almost on a realtime basis, allowing22 for respondents to get good, accurate care23 health-care information about a individual24 in a lifesaving matter and how on and on25 89 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 and on the benefits of this both2 cost-effective and by way of service3 delivery have been proven in other cities.4

Mm-hmm.5

Transitioning6 from that, I know that I will never in7 this economy get a health center in my8 district. And, God forbid, I don't want9 to prove the editorial boards right by10 saying that only District Councilpeople11 think about their own district.12 But I will say: How have you13 researched the possibility of using14 telemedicine in our health centers, and15 where are we with that?16

The term17 "telemedicine" that's described, I think,18 having not seen the report, I can only19 tell you what the press said.20

Thank you.21

And I think I22 understand the issues, which is to use, in23 the triage office, nurses as opposed to24 the EMS -- current EMS routers for calls.25 90 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

Mm-hmm.2

There are what are3 called "nursing call centers" that have4 been set up across the country. I know it5 because we had one at Children's Hospital.6 Those centers field questions7 from people about appropriate use of8 health services, and they can give advice9 to people by phone.10

We, I think,11 agree that they are worthwhile having.12 The specific question is: Have we, in13 public policy, started to research and14 develop usage in an already-strapped15 situation by way of money, by way of16 resources? And I'm going to get into some17 of the specifics of that. But have we18 started the process?19 'Cause I asked this last year20 and I'm going to stay consistent.21

So if we're22 talking this for the health centers --23

No, we're24 talking about telemedicine in general --25 91 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

Okay.2

-- in3 addition to these kinds of usages.4

Okay. In our5 health centers, we call it -- I think the6 best term is "nurse triage."7 So as with the Controller's8 report with EMS, which is in the Fire9 Department, we do nurse triage in the10 health centers. When a call comes in,11 nurses will take the call, answer12 questions, refer a question which they13 cannot answer to a physician. And that14 provides, I think, additional service to15 the public.16

All right.17 My question is: In light of the fact that18 we're in the -- I'm going to make it real19 simple. In light of the fact that we're20 not going to build buildings, and one of21 the good ideas that came from the second22 floor, of which there are many, and I want23 to say that on the record, that we could24 use multipurpose centers so that a25 92 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 equipment van could pull up to a senior2 citizen center, a rec center, and within a3 hour or so, transform it into a triage4 center or at least a first-level of care5 interview with people.6 So that we could reduce the7 three-month wait time at our health8 centers, so we could take the show on the9 road, if you would, and be able to use10 this technology that exists currently and11 reduce our expenses and increase our12 effectiveness.13 And I want to know specifically,14 are we moving in that regard?15

We have pursued16 part of the reimbursement issues for that17 kind of service. There are substantial18 reimbursement issues for us starting out19 in this financial climate with a new20 service.21 So yesterday in Harrisburg, in22 fact, I talked with the Secretary of the23 Department of Public Welfare about some24 ways that we might think about financing25 93 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 services that weren't just center-based,2 as we currently have. So to that extent,3 I have pursued it.4 Part of the reluctance I've had5 is that we've been living in a difficult6 financial climate, I have to admit, and I7 would be happy to talk more about it, and8 I will certainly read the report.9

Under one10 category of the Stimulus Package --11 (Timer bell rings.)12

-- which is13 updating technology for hospitals, there14 might be a line item that applies to this15 particular type of delivery of health16 service, and I'd like you specifically to17 look into that.18 My other question is: How many19 doctors do we have employed by the City of20 Philadelphia versus a contractual21 relationship with as consultants?22

In the Health23 Department alone?24

Yes. And25 94 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 while you're looking it up, what is the2 cost differential between consultant and3 employee by way of the category of doctor?4

It's a difficult5 question to answer only because we do not6 pay physicians for benefits. We pay them7 a salary that should allow them to8 purchase benefits. And if we contract,9 there is an overhead rate, obviously, for10 the contractor.11 We have looked at those issues12 so we've --13

I didn't get14 a answer.15

The answer is16 they're about equal.17

No. What is18 the --19 (Councilwoman Tasco now chairing20 hearings.)21

You'll come22 back. Go ahead, go ahead.23

I just24 wanted -- they aren't equal, and I already25 95 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 know the answer to the question. So I2 just want them cited on the record of are3 they full-time doctors, or do they have4 relationships part-time with other5 hospitals? What is the relationship and6 what is the cost differential by way of a7 consultant versus an employee?8

The issue is9 full-time and part-time. So the full-time10 salary for a physician employed by the11 City of Philadelphia is, on average,12 somewhere between 125,000 and 130,000 a13 year, which is below market rate for a14 starting physician in this area in the15 primary care field.16 And as a result, for hiring, we17 can -- it actually, depending on the18 specialty, it would work for a starting19 position, but we can't go up. So that to20 hire a full-time physician is very21 difficult for us in the health centers.22 As an alternative, physicians23 are hired on a part-time basis. It's not24 that they work somewhere else; it's that25 96 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1 they work hourly for the City. Some work2 by contract and some work directly, paid3 by the City in Civil Service as a4 part-time employee.5 And what has happened over time6 is, we have used the mechanism to, in a7 sense, bring in new people through8 contract and ultimately do our best to9 move them into the Civil Service, because10 we are committed in the Health Department11 to reducing the number of contract workers12 that we have.13 So the real issue here, and the14 difficulty in interpreting the data, has15 to do with full-time versus part-time. In16 fact, if we look, the number of --17

Is --18

-- full-time19 physicians in the Health Department is20 vanishingly small.21

And I'm going22 to stop now, but is it not true that we23 pay $162,000 for a physician? And on24 salary, they're $97,000?25 97 4/22/09 - COMMITTEE OF THE WHOLE - FY '10 BUDGET1

So this has to do2 with full-time versus part-time and the3 hourly rate.4

Is it not5 true -- and I'm going to use Wilson6 Goode's lines -- that we pay $162,000 for7 a consultant versus $97,000 for an8 employee?9

So the answer to10 that -- I want to answer your question.11

Okay.12

I think that your13 question is a good one, and I think that14 it's difficult to tell from the budget15 what this means.16 So a practicing physician in a17 health center, full-time, is not paid18 $97,000.19

How much --20 okay, I'm going to stop, but I will come21 back.22