Travis County Commissioners Court
September 5, 2006
Item 30
30 is to receive and discuss the proposed budget and associated tax rate of the Travis County health care district for fiscal year it 2007.
>> judge, Commissioners, clark high drik, chair of the Travis County health care district. Chris young, our ceo, tom young, who is -- who is a very distinguished board member and up to donald patrick, who is a board member. Back there we have several noarz the back and of course the 10,000 others that the court referred to are in the hall subject to being called forward. We've given you a powerpoint presentation, we've been to see each of you and we appreciate each of you visiting with us vmp. We thought those conversations were very informative. We've submitted some more information but we're not going to give a powerpoint presentation unless you want us to. I thought we'd share a little bit of information with you about what the district has accomplished, some things that it hasn't accomplished, the challenges and how all those tie into the proposed 2007 budget and tax rate. Before I did that and before we advocate for the proposal that we have made to you, I wanted to assure you that we understand and respect the role of this court that you play in setting this tax rate. It's your decision. We also want you to know that we appreciate very much all the help that we've got fren the county over -- gotten from the county over the last two years both from you all and from your staff. We couldn't have made it without you. We trust you will make the right decision on what our tax rate is, and whatever you decide, we're going to take that number and we're going to go off this coming Thursday night and adopt a budget that's consistent with that number and bring it back to you so you can approve it. Now for the pitch. And I thought in doing that that we would start with the time we were formed when we transformed a rate of about 6.34 percent from city taxpayers and 1 point lower or so from county taxpayers to set an initial rate of 7.79 cents. That was the predicate on which district was established and on which we talked to voters prior to the referendum on the district. The predicate was if we equalize the tax rate across the district and transferred in the amounts being spent by the city and the county on health care, we would generate approximately five million dollars more for health care. We would col date the city and county budgets into one s we'd get a board and staff focus odd thu issue and we would bring focus, transparency to an issue that was presenting a lot of problems both to the county and to the city and to our community. We were having dwertionz at brackenridge -- diversions at brackenridge in the emergency room, crash room shortage, icu shortage. We were having cost increases at the county and city and their budgets respect to health care. We were having judge herman speak increasingly loudly about the shortage of mental health resources in our community. We got together and had this study group. We came up with the hospital district as an approach. We set that budget. In 2006 we came back to you and proposed a nominal rate of 7.79 cents again, the same rate. The effective rate was a 2.6% increase last year at this time. This year we have proposed a rate of #- 7.47 cents, which is a 7.95% increase in the effective rate. An average increase on the average home of $7.63 would result in an average increase over the two-year period of 5.3%. It's the lowest tax rate of any urban county hospital district in the state by far. It has been -- we've held two public hearings with respect to our tax rate and budget. At the first public hearing no one testified. At the second public hearing three people testified, all in favor and in support of our budget. Perhaps it might be helpful to look at what the district has actually done with the dollars that had been entrusted to it. And I'm just going to mention a few things. We spent 1.6 million along with stee z ton's 1.6 to substantially expand the icu brajt hospital. We spent $272,000, which was matched by each of seton and the shivers cancer foundation to double the space at the shivers cancer center. We've spent 225,000 in '05 and 300,000 in '06 on a project of the Travis County medical society known as project access, which has enabled hundreds of patients in our community to be seen by private physicians. We have expanded funding to people's community clinic by $200,000. We have funded the addition of a 14th community health center in the st. John's neighborhood and we've committed $250,000 to fund the establishment of an urgent care center ajay stoant brackenridge, which is intended to cover the cost of patients in the community health center. We've expanded the meerj program in the community health centers which mainstreams the treatment of mental health patients who may have other issues and who are -- and health issues who are in the community health clinics. We have made available to Travis County mental health and mental retardation $300,000 of psychiatric medicines through the 340-b pricing program, which has saved them over $500,000. We have convened a stakeholder group that includes the county, the city, mhmr, the two hospital systems and us to focus on the psychiatric emergency system in our community and as part of that we have committed $500,000 in this budget year to a temporary program at seton shoal creek to treat people in a psychiatric crisis. We have begun a multicounty collaboration that would establish a regional nonprofit health insurance company that would be for a five to six county region, which is what we hope to be the beginning of a multicounty collaboration that will grow and help us teag the issue of cost. We have hired a staff of five, which is what we discussed during the campaign. We have worked hard to develop a strategic plan that has guided and will continue to guide our spending. We have received the blessing from the federal government in the form of a one-time payment that came in at the end of September and early October, and the last year of approximately $30 million. I count that as an accomplishment. It's primarily the result of below cost work that was done for poor people at brackenridge and the your accomplishment certainly is that of seton, but I credit you all, I credit your staff, I credit trish and her staff in working very hard to coordinate that send up-in getting that money in. We're going to be talking a little bit about that $30 million in a minute because I think it's an important aspect of where we're going from here. We have operated for the last two years with a budget that have you approved and we've stayed within that budget. We've completed only one fiscal year, but that fiscal year has been audited and no exceptions came from that audit. I believe that it's fair to say that we have been is prudent in the expenditure of our funds and the accounting of those funds. What haven't we accomplished in we've done good things. You can look down that list and see that lots of good things have happened and are going happen as a result of those expenditures. Can we yet say that we have dramatically and measurably increased access to care in our community? No, not yet. Have we dramatically reduced cost and increased efficiency throughout the health care system? Not yet. We have not yet established the matrix by which we will hold ourself accountable and those that deal with us, at least not yet, but we have plans for that. What are our challenges in 2007? We have some huge chal flengz 2007. 2007 is the gleer which the seton children's hospital will open, the dell's children hospital will open. That's going result in the vacation of a tremendous number of queet that's now the children's hospital at brackenridge and the reprogramming of all of that space. It's an opportunity for our community. It's going to be quite a burden, frankly, for seton to deal with. It is a place where where ought to have a role in planning that space, and while we have not crossed this bridge as a board, from my own personal standpoint I think it's a place where we need to have some money to reward and incentive the investment that seton will have to make at the old children's hospital in order to make that space work for our community, and I think there's some incredible opportunities, frankly, to deal in specialty care and in critical areas where we now have insufficient resources if we're prepared to commit some resources and work in collaboration with seton there. With respect to the community health centers, there's a plan to responsor those centers and move sponsorship from the city to the district. This is a year in which that project needs to be planned and cushion needs to be begin. That is going to be an incredibly demanding project. It's going to require a lot of resources. It may require some substantial economic resources from our standpoint in order to get it done and get it done right. We're in the process of completely reyirning the m.a.p. Program. When we began you will recall we had two m.a.p. Programs with two different sets of eligibility criteria. Those were tentatively merged into one, but the whole program we resolved early on needs to be completely re-engineered in order to enable us to expand it, control costs and make it work better for everybody to simplify it. It's been a big part of our strategic planning process. We have a huge gap in our community and specialty care. We have an opportunity with the utmb move at brackenridge and with things that are going on at brackenridge to move forward. It's a project we've been working hard on, but frankly the financial aspects of dealing with the specialty care problem are downtown dmaifnlght, we're going to have to continue to move forward with the stakeholder group that's been convened. We have as you know the outline of a psychiatric emergency system that all of the funders in the community are asked to participate in in one form or another. This is the year in which we need to take the plan and make it happen, get in in our budgets and actually execute on that plan. We needed to continue to build our regional collaboration. We're moving towards actually forming an entity and we have difficult decisions to make about how to capitalize and fund it and what groups it's going to serve. And fieply finally, this is the year in which we will need to establish some matrix by which we will hold ourselves and our other providers accountable. I want to say a word about our reserves because I think as we've talked there have been a lot of questions about that, I think. I think the natural inclination is to say you had this 30-million-dollar unanticipated blessing. Why don't you spend that rather than have a tax increase in the truth is we're going to spend 2.$8 million of that, roughly 10% of it, in this year's budget. It's already in the budget to be spent. Beyond that we feel that it is inappropriate to commit reserve dollars to operating programs because those programs come back to you next year and you're going to bleed yourself to death if you spend your reserves on those. We do think that those reserves need to be spent, but they need to be at least the reserves that we've got now for the most part in allocated reserve, the resaid al amount of this 30-million-dollar blessing that we got, we expect to spend a good part of those. Certainly some part of them we think will have to be put in our unallocated reserve as we plookd at our reserves, we think that from a retch new standpoint we probably have a riskier revenue stream than you all do. 20% of our revenues come from the same source that this 30-million-dollar blessing came from, and he who gives might take away. And what the federal government is going to do with respect to sponsoring health care in the future is a yient unknown. If I had to guess, I would guess that this year we'll take approximately $6 million over the course of the year and decide to put that in our unallocated reserve. That's about a imhoorchth. We're now at 90 days worth of cash in unallocated reserve. We may decide that we would like as a long-term goal to get to 180 days. And by adding six we would blaiferk be one-third of the bay there this year. Other funding opportunities that would make sense for us to consider, but which the board has not yet looked at would be making investments in brackenridge and specialty care, in the transition for the community health centers and in establishing a regional nonprofit health insurance company. We want to be very careful how we commit these funz. We're going to be very studied and conservative in our approach as to how we spend them. But having said that, I hope that we don't hesitate to spend them when the time is right when we've thought through what the right thing and the right balance is and I know I can count on dr. Tom coopwood to keep us focus odd that. In closing I just want to say that we believe that our approach to the budget and our request of you is appropriate. We urge that you take the longview when you look at our proposed tax rate and budget, and by that I mean ask the question quha wha have these people dwun the tax dollars that have been entrusted to them over the past two years and is the tax rate that they propose in relation to the tax rate that they began with two years ago appropriate, and to resist this it notion of thinking in the short-term of one year versus last year health care districts and health care just don't work that way. We deal in the situation where we get cost increases. We probably could have come in last year and asked for a 5.3% increase, perhaps might have gotten it, and this year might have been a lot easier had we done so. We didn't. We feel like we need these funds in order to execute our strategic plan and we respectfully ask your consideration. I close by saying we trust you, we're going to do in -- in the end we'll bring you a budget consistent with what you're comfortable with. Thank you.
>> any grez the court? Any questions from the court?
>> when we last left roll back was being talked about, which would be eight percent.
>> #- 7.95, which is a #- 7.47 rate. Am I right?
>> is is there another number where you all aring hovering around in terms of thinking that that is hearing what the court was saying last time and understanding what the needs are? Is is there another number that you're laying before us today?
>> there's not another number that we're laying before you today. We asked for what we thought we needed. I guess I want to be clear, we are putting whatever other number you might think about in your hands, and glad to talk to you about what differences there might be if you decided that you were not comfortable with 7-point knife. 7-point knife. You wanted to do something less, we would talk about what to do in the budget wharks the impact of that is on the budget. But that's how we were thinking about approaching it.
>> what's the impact of reducing your total budget by one million dollars? What would that new tax rate be and what would be the impact? And I think I mentioned this to three or four of you that I've chatted with, so it's not a new calculation.
>> at six percent above effective the rate would be 0734. And the reduction would be as you indicated would be a million dollars. Our tax rate yes or no rates -- each one percent increase in the effective tax rate generates about $502,000 to the district. So a decrease of a million dollars would I think occur in two places. We would reduce the amount that we are making available for enhancements, which goes towards future funding of additional programs and services. There would potentially be some small increases -- decreases to certain of the operating expenses. We would reprioritize in terms of those things which we have to do this year and those things are those that clark already menged in term of the transition of the clinics and other transition type activities. And we would have to reprioritize from the standpoint of strategic investment to the expenditure budget.
>> > what would be the impact on Travis County residents?
>> of a two percent?
>> of a one million decrease.
>> I think it would primarily be to limit our ability to enroll or people in the m.a.p. Program and it would probably limit -- I would expect the majority of a one-million-dollar cut to occur in what we call the enhancement line, which is where we would have money to deal with possible m.a.p. Expansion, possible expanded commitments to mental health on beyond the million dollars we have in the budget. Other things.
>> so you have 28-plus million in allocated reserve. And you have taken 2.8 of that to spend on a specific item. If you take six million in transition in the unallocated reserve, that leaves $20 million. In bowrjt there's a two and a half-million-dollar unallocated reserve. Our intujt many times yours. Why wouldn't you simply take a million dollars from the remaining 20 million in allocated reserve?
>> every dollar we take from the allocated reserve and use it to spend for an ongoing program expansion increases the cost base to the district each year.
>> but this wouldn't be an ongoing expansion that you're taking a million from. You're simply russian the million from your total -- you're simply reducing the million from your total budget.
>> I thought you were suggesting that we take the additional money out of the allocated reserve.
>> I'm suggesting if you have 20 million left in allocated, after transferring six million to unallocated, the untouchable reserve, and 'the other 2.8 million that you indicated you need to spend, why wouldn't you take that from allocated reserve rather than different programs in.
>> because the program that we're suggesting that we would reduce relates to ongoing programming expenditures. To the spent that we spend additional funz on program expenditures that have an ongoing recurring cost in later years, we would be pulling gren allocated reserves next year to phi the ongoing expenses. The goal has been to only use our tax revenue and our ongoing annual revenue to fund existing and ongoing service obligations. So to the spent that we're using allocated reserves to spend on ongoing, existing expenditures, we would be over time reducing that amount, but at some point in time not replenishing those allocated reserves.
>> it's just a judgment call, judge. We felt comfortable using 10 percent of that allocated reserve in the budget. Obviously, you know, what's right is subject to interpretation. Our concern is if you get into a habit of hitting your reserve -- and I realize that allocated reserve is really -- we didn't really know where else to put it. It's not really the same kind of allocated reserve that I think you all maintain. We had this one-time blessing. We didn't want to tut putt it nawl the untouchable reserve, but we're not exactly sure how and we're we're where we're going spend it. It sort of ended up in the allocated reserve. But our concern is that if we keep hitting that allocated reserve for a program; we're either going to -- we're condemning ourselves to increase taxes more than we otherwise would have in future years to maintain that kind of level of service. And there's a pay as you go concept, I think, that -- I think this is something that you have on other occasions advised us to do, to pay as you go is something that you all and christian have talked to us about. But it's just a judgment call.
>> could you take another million from allocated reserve, the 10% becomes what percent?
>> somewhere in the 12.
>> 12 to 13.
>> 12 to 13 percent. What was your total budget your first year?
>> our total expenditure budget?
>> not the tax rate, but the money basically.
>> I believe it was about a total expenditure budget was between 69 and 70 million. Right at the 70. I'm sorry, iious have last year's, but it was right around 70 million. That exclude the pass-through items, both dish and tobacco settlement that were paid to us.
>> what would the apples to apples be for '07? 70 million your first year, 2007, apples to apples would be how much?
>> let me get you the actual figure. 78,078,000.
>> so that amounts includes any windfall from, say, the federal government, any other source?
>> no, sir. In ternlz of the 78 million?
>> right.
>> it assumes that to -- in order to achieve that 78 million spending level, it does assume that we're taking $2.8 million out of that allocated reserve to support that $78 million in expense.
>> so the challenges and twliernltsd challenges and opportunities for the next several years if not decades.
>> I think that's a fair assessment. This is a very long-term project we're workoghere.
>> well, I guess personally I have two issues. One is going to the rollback rate is a big deal. We wouldn't do it at Travis County except in extraordinary circumstances. I am personally committed to exceeding roll back if the circumstances are appropriate. If there are specific programs and services that have to be provided to meet specific needs. And I think that the board has adopted the good principle of planning for the future. It's just that I'm left with the impression that a soft area is allocated reserve. And when I look at the line items in the budget, I'm left with the impression that the extraordinary circumstances that we yuf going to roll back don't exist. Now to be honest, implying the county judge of Travis County budget evaluation principle, which is the only one I know. So my recommendation would be to reduce the budget by one million dollars. I've agonized over this since I first heard your first presentation to the court about the overall budget, and I just think that long-term that's something that we ought to do. I think that also if the time comes when we have to exceed roll back or go to it based on spefg needs that we need to meet, then the Commissioners court is in a much better position to work with you and go there. So the current budget I think contains a whole lot more flexibility than we would adopt at Travis County, one. And two, certainly a whole lot more than we would adopt if by doing so we go towp the rollback rate. That's the opinion of one court member.
>> what's the rollback snrait. Rate?
>> technically eight percent.
>> let me ask this question. The participation that you shared with the emergency room and at brarjs you and seton have both combined as far as putting a certain amount of money in -- I guess totals 6.4 million defined at the brackenridge. I'm kind of concerned about that because that is a situation whereby a lot of folks use that facility, especially in the emergency room and stuff like that. What's being proposed? Would that offset any current funding that have you available right now dealing with the brackenridge study? Could somebody answer that question for me?
>> those funds were expended in fiscal year 2006 for the expansion of the icu.
>> but I'm saying for the current -- go ahead.
>> so those funds were a capital investment. The district invested is .6 and seton invested the remainder 4.8, I believe. And those were not operating costs, so they don't -- they do not offset anything going forward whavment they did was to expand the icu capability to relieve the emergency room.
>> right. But what I'm trying to get to are the services that's being rendered out there. I want to make sure what we're doing, we have no interruption in those kind of services. Now, here what we're saying is it makes stoans me what the yuj is proposing, but when it actually comes down to the bottom line, will sfses services be atered in any form or fashion as far as what you're tiebl operate on right now?
>> if we have reduced bowrjt by a million dollars we will probably reduce the number of m.a.p. Enroll ooez we are paying for. We will have to reevaluate the amount of money that we are -- will need to go to contribute in terms of the psychiatric emergency services. We'll need to look at what's in our budget and what the total final cost is. And we will -- we do not have a million larz that we can remove from the operating budget. The operating expenses are less than -- 6.4% of our total budget. A million dollars would be one-fourth of that. So we will be looking at dollars that affect direct service delivery. And we'll have to apportion that appropriately.
>> Commissioner Davis, I think the project of the year looking at brackenridge for a -- there are a couple of projects. One is a planned expansion of crash room capability at brackenridge, which is very important, which seton is looking at doing this year. And the other is retrofitting or refitting what is now the children's hospital space. The board hasn't vote odd this, so what role the district will play is something that's got to be discussed in terms of how much or whether it's appropriate for to us naing and invest in those kind of things at brackenridge. I personally think that we should, both for reasons of that money gloingts good. This is the place where terribly hurt people go. Those crash rooms, we have a shortage of, we need more and reprogram that space in a way that benefits the folks that we're responsible for. And we will be somewhat con strained to the extent that we don't get what our budget is, but -- what our budget request is, but is it going disrupt the operation of brackenridge hospital? I don't think so.
>> let me pose this other question. You mentioned that you had about $30 million coming from the federal government.
>> yes, sir.
>> what would that money -- what the intent of that money?
>> that money would make good or true up upper payment limit for medicaid services provided by seton at brackenridge hospital which under the terms of our lease with seton, a portion of that came to us. That's the genesis of those dollars.
>> those dollars essentially represent the difference between what the state medicaid programs pay to the local hospitals and the amount that's allowable under the federal medicare program. So there's a program called upper payment limit which attempt tz to reconcile the payments. As the states continue to decrease the amount of money that they pay to hospitals under the federal -- under the medicaid program, there are federal monies that are made available to try to give them a bump, so to speak, to compensate for that reimbursement because that reimbursement does not cover the hospital's costs. So it essentially additional funds that come after the fact, after the services provided, these funds are drawn down and made available back to the hospital. And as clark indicated, per our lease agreement with seton we do share in the amount of-- we share in the amount of upl program dollars received. So those dollars related to the state fiscal year 2004, they were not received in that year because these program dollars were done basically two years afterwards.
>> and I guess since the Travis County taxpayers, whether they reside in Austin or outside the yrd of Austin now the county, will have to bear the expense through whatever the court decides to set as a tax rate, I guess my concern, yuj, with the -- with that recommendation that you made, was there an attached tax rate associated with that million dollars coming out of the allocated reserve or whatever? Do you draw it down without a certain tax rate associated with that?
>> it would be .7064.
>> and how much of that would go to the person who resides outside of Austin? What portion would that go across the board?
>> that would be applied to everybody drentz of Travis County.
>> that's what I wanted to hear you say. So thank you. The reason why I pose that question is regardless of whether wr you live at, folks need to understand that we volleyball to play the same deal. So I think it's very important for to us look at that. I heard you did state earlier that for every, what it, a penny or whatever it was that was equated to be about $500,000.
>> one percent increase in the effective rate.
>> it would be at least a little more than $500,000 decrease from what we're looking at before. Is so I'm just trying to lay everything out and make sure that the folks that are looking at this have a clear understanding of what we're trying to do here is very important. I think those questions that I asked, I want to make sure some of the services that we have available here will still be there. You mentioned one other thing too and I want to make sure that's laid out also. And that is the regional concept of what we're doing here. How and what are you doing in that arena as far as regional participation and stuff?
>> I think the concept of that is that we would form a regional nonprofit health insurance company that would endeavor to issue very low cost policies, hopefully with some subsidizing from the federal government through what will be developed as a statewide medicaid curveout or waiver to low income people who are working for companies who don't now provide health insurance. And the trick will be to have it capitalized fairly and equally on a multicounty basis so that don't have Travis County tax dollars going into something that, as you point out, for someone in Williamson county or hays county that they use their dollars to fund that part of it. But the idea would be to have it pay for itself for the most part. If we could get this medicaid waiver, we could use some medicaid funds to subsidize the cost and have a low cost product that would expand access to care.
>> that's pretty important because we do have a lot of -- we've been looking around and the newspapers here lately, we've been talking about Travis County being a part of a situation where I'm really not proud to talk about it because of the fact that we have children that are in poverty. I mean, you see that we have a lot of folks in poverty, Williamson county, Travis County and other children. And I think that this property issue is very critical to us of how we can direct it, how we can improvise and do things to make things happen. So I'm really concerned about that regional because every time you come here I ask about that regional aspect of what we're doing here and if we need to go across accordingly to make sure that it's not all impacted by Travis County residents. Judge, I just wanted to throw that out and iron things out a little bit so the folks kind of understand exactly what we're doing here. And I'm just trying to put a little more light on the picture.
>> I was going to ask you, the -- when you talk about the reduction of some of the programs, that doesn't mean -- like, for instance, being able to sign up less people on our m.a.p., that doesn't mean that we cut everybody out, it just means that it stops the number of people or the progress.
>> it's the lesser growth.
>> you're not talking that it will totally wipe out everything.
>> absolutely not.
>> but it will slow down the planning a little bit. You'll still work on those projects, but you'll be slowing down a little bit.
>> yes. I think that's a really good point to make because what we have -- what we have built into this budget is what we project to see, for example, the growth in the m.a.p. Program that we know historically, for example, this year, even though we projected an increase in our budget, we actually -- the enrollment growth exceeded that budgeted increase, so ended up spending another 2.$4 million. So we might go above the budgeted m.a.p. Enrollment. Your point exactly, it slows the rate of growth in that program.
>> but it doesn't kill it off.
>> no. And it does not reduce anybody from the program rolls. It's a lesser increase.
>> if you have a standard increase in the health care delivery total for '07 over '06?
>> that's correct, sir. Based on projected enrollment and increase in the base coftz.
>> of about five million dollars.
>> in terms of total health care?
>> yes.
>> across all contracts, yes.
>> let me ask this question then. Sorry to cut you off. Go ahead. [ laughter ] I had a senior moment. I was trying to ask before I forgot it. In terms of the total budget, much of which you don't really control, but there is money flowing in from other sources. Part of the backup that you gave us show the much bigger number than the $78,000, fwu includes tobacco funds and disproportionate funds, a lot of other stuff. For '06 the total is $146 million.
>> right.
>> what's the apples for the first year that you're operating?
>> for the first year? It was -- I wish I had brought that budget with me. I didn't. It was about 116, I believe. 113 or 116. And again, the difference is the amount, the dollars that we received that we then turn around and pay to seton. And to the county for tobacco settlement for that portion. The reason why the number was so large in '06 is because of those one-time upl dollars we've been talking about,ious as we received a higher amount, the amount we received and then passed on to seton was higher. You will note in this year that those other pass-through dollar amounts is lower for this budget year because the amount that we expect to pass through to them is lower. We are not going receive those one-time monies anymore, so we are budgeting to pay them essentially the amount that we receive this year.
>> and that amount is out of your control basically.
>> that's correct, sir.
>> if it were in Travis County and I had a vote to cast, then I would reduce it by a million dollars and I would try to minimize the impact on users of the county service as much as possible. So my motion is that we request the board of managers to reduce the district's budget by $1 million with the minimum impact on residents.
>> are you expressing an intent, judge?
>> this is just a request.
>> I'll second the motion, judge. And let me tell you why, because I think that the goals that you have, that you've laid out today, are goals that I really am interested in getting done. The other thing is that regardless of whether some people supported the hospital district or not, there were obviously people who were interested in trying to get some of these issues addressed. And in -- and have a board that they could hold accountable for that since it was not going to be under us nor was it going to be under the city. So. But I think the fact that they can always feel or I think they ought to feel that they have some accountability by the fact that this court gets to look at the budget as well, gets to look at the money that have you coming into this area, whether it's one-time money, especially if it's one-time money, but if it's the property taxes, then we have an opportunity to discuss this together and so that gives me a lot of comfort, at least feeling that there's some accountability here.
>> [one moment, please, for change in captioners]
>> knowing it's not going to kill any of your goals, I support all of them, but that it kind of -- kind of slows it down just a little bit. But we will get there. Eventually. But I really support your mission. Let me try a substitute motion, to see if there's middle ground here. I join the others, I said this before, I don't think going out to the rate is justified at this point. It flat out is. I think frankly you did make a mistake by going too low last year, as we all know from having to do our budgets, it is very difficult to get that rate back up even when you are trying to do strategic adds. We are finding that and the city of Austin is finding that. For me I'm trying to get to the middle ground -- middle ground of a million dollars less, that it be halfway in between. I would put an intent motion out of there 6.95%, as tim gunn says on my favorite reality show, project runway, make it work. I think that would send a message saying we appreciate your -- your enthusiasm and trying to expand health care, but I'm afraid that if we go down to the 6% mark, that -- that because their tax rate is so -- so loaded to begin with, which is kind of negative, but it is a negative if you are trying to do some strategic adds. I wanted to adjust a little bit more back because I am cognizant of the fact that the lovely state legislature is coming back in January: I think there needs to be a little bit after curb there having a rate that is ever so slightly higher, because that is something that's -- that it's a long-term strategy. I'm also cognizant that what's going on in their budget is what we've had to deal with in Travis County. And that is the -- the super jacking up of expenditures in your budget, because of your relationship with the city of Austin. You are seeing the cost of those services provided by the city of Austin in the clinics go way up. Almost like it was flat and then it jumped. And we are seeing that in our budget as well. In terms of -- of our relationship, in terms of the cost of them doing things on our behalf. And in the same way, we're having discussions in the same way that they are in terms of what is the -- what is the long-terminator of some of those relationships. On health and human services we have made some strategic decisions to -- to talk about some things that we agreed with, some things we didn't. We said you know what, we need to bring that in house, we need to figure out ways that we can control our test destiny, control our costs. I think what they are proposing to do here is to talk about where do we go from here in terms of the relationships with the city of Austin. They are also dealing with the same thing that we will be dealing with when you do our budget markup, one time money versus ongoing money. I don't want to restrict them on their ongoing money because I heard very little in terms of their discussions of what is not an ongoing commitment versus the use of one-time money. One of the things that is one-time is that 6 million-dollar transfer. I think that's appropriate, that is an appropriate use of one-time money. But the other kinds of things that you all are talking about are really ongoing commitments. Especially with your rate being what it is, I think it would be a disservice to talk about using one-time dallas to do ongoing commitments. So -- so my substitute intent motion would be whatever the equivalent is of 6.95% above effective is it's about a half a million dollar that makes some -- appropriate adjustments. I think they could still do good things, perhaps not be as -- as severe. I want to say, please trish help me out. I thought your --
>> hold on, is there a second for the substitute motion.
>> yes.
>> open for discussion. Commissioner?
>> I'm sorry, trish, did you not have something in here that your maintenance of current effort is -- is about 6%?
>> yes, ma'am.
>> if 6% gets the maintain occurrence effort, again they are having to deal with the fact that the bill from the city of Austin is a whole lot higher than the years past, if the maintenance of current effort is 6%, we are not really letting them have anything there related to strategic adds. I pray as you go through your budget, if this motion is successful, that you figure out a way to handle that expenditure because it's -- it's the first of many to come if you do not control your own dissustain.
>> mr. Richie has been frying to provide input -- trying to provide input.
>> I want to thank you all for your careful deliberation over our budget. Studying it.
>> we have been fortunate to have a one-time blessing of $30 million, just like sometimes as clark said the -- they give it to you, some people can take it away from you. There's a discussion that's taking place over in that pink building right down the street, also out on 51st street. About a program called star plus. The state is committed to saving $109 million which there's approximately 4 million of that we may end up having to pick up. I will let trish go into the details of it because she's been apprised of this discussion. There's a possibility the state may come back with an additional $4 million that he is the rope why we have -- been trying to build up our reserves, as I recall, from our very first meeting it was a great debate between the county and the city about how large the reserves need to be because we have these unexpected hits like this, this is what we are trying to do, because that comes in and hits us at the 4 million while we are getting this -- this 6 million increase, essentially we are -- we are not going to actually gain ground but we are losing ground. This star plus program is one of several programs, something beyond our control, something that we have to participate in. So go ahead and share the details more, but -- when I heard that we may end up having to pay an additional $4 million to help the state save dollars --
>> helping the state save dollars? Explain what you are talking about.
>> I'm going to legality trish explain.
>> that really caught me up. The last part.
>> there was a program that was instituted out of the last legislative session that's called star plus. You will recall that there are a number of individuals that are enrolled in medicaid that are blind or disability. The state set a savings target of $109 million that they expected to achieve by enrolling age blind and disabled individuals into managed care -- medicaid managed care programs. Those programs were never instituted. They were not rolled out in a time frame that the state expected. But the state still has the savings target of $109 million they expect to achieve. Their proposal has been to reduce the amounts that they pay the hospitals by $109 million in order to reap those savings. There's been some discussion going on for a number of months about how to -- to minimize the cut to the hospitals based -- to cut their -- proposing to cut their medicaid rates even further. There has been discussion of the transferring hospitals, nine transferring hospitals in Texas which we are one to actually make an intergovernmental transfer on behalf of the state that would allow them to not use their fund and essentially save those monies. Our share of that would be $4 million.
>> an unfunded mandate request that the state is making and imposing it on the hospital district?
>> yes, sir.
>> that's exactly -- you know, that's the same thing that they do to us up here.
>> we share that. It's a 4 million-dollar hit.
>> our share, correct.
>> the state as far as this health care district is $4 million to you.
>> that's correct.
>> you anticipate that that will happen.
>> sir it's very difficult to understand. Very likely we will bare that one way or another.
>> include any of that in the next increase?
>> no, this is -- no, no.
>> something that -- we have to determine what -- what the effect is on this particular issue.
>> in the same vein, just to give you a sense of the concept that they giveth and they taketh away. There are very robust conversations happening right now at the federal level around how the upper payment limit dollars are going to be made available to the states, there's some discussion of -- of capping the upper payment limit pools to what they refer to as costs. And the effect to Texas would be somewhere upwards of $257 million in reduction of upl dollars available. I'm not sure exactly what this district's share of that is, but that $257 million for non-transferring possibles it's probably a pretty significant share. So we are facing that next year in the coming years with the upper payment limit dollars available to us, coming to us as part of our regularly programed upl line, you will see that line in our budget. Those dollars could end up being much less in later years than they are today. Our funding sources are not as steady as our tax funding pours.
>> if the star plus hit were to come, would you fund it from one time or ongoing dollars?
>> > I think the net effect, I want to be clear there's a lot to be worked out, they haven't decided how this allocation would work, how the actual mechanism would work. Potentially would come out of our currently budgeted upl dollar line [indiscernible], impact to our current revenue.
>> we are trying to hold strong, keeping with the reserves, not pull out anything, only for those unanticipated costs, the states or the feds put upon us, we are in a position that they can't fight back.
>> I understand. One million from 20 million, leaves $19 million. So -- so -- so there's substitute motion for us, which is to cut the -- the increased -- increase from 8% above effective to 7%.
>> 6.9 -- from 7.95 to 6.59.
>> yes, sir?
>> let me ask a couple of questions. Have we -- have we increased the number of people that use the map program since we started the health care district?
>> yes, sir.
>> and --
>> that's approximately I think it was 37% from 2005 to -- to where we expect to be at the end of 2007.
>> well, you know, we can -- we can throw out percentages and we are talking about all of the things that we want to talk about, and -- and I think that I can talk strongly about this because I was not supportive of the health care district. But now that we are in it, I mean, you know we need to do the best job that we can do with operating it. I think there are some -- some probably brick and mortar kind of things in the budget, I mean, yeah, there obviously are. [one moment please for change in captioners]
>> that doesn't please me that we don't have some sort of an interlocal agreement ability with -- I'd love nothing more than to sit down with judge powers and judge doerfler and say you need to help us. It's right for you all to let us bill you whenever you send somebody in to our district. But whether we're going to get that done or not, who knows? Y'all know we have the energy I think from at least some of us up here that we want to work on that. But do you know what? We can't say up here that we want to continue to take care of people and yet not watch the budget grow. The reason I'm inchiend to agree with Commissioner Sonleitner and take half the bite is because I think that I can stand up in front of someone and say, you know, as opposed to asking for the full million dollars, I was willing to cut the difference because I do think that there are some things that you all need to do like we do and tell some people, we might not be able to do that this year. We'd love to help, but we can't. But I'm not necessarily interested -- unless we're going to put a closed sign in all the clinics and say, 3:00 o'clock we're filled up because some people are wanting to take and expand the hours. Good god, we can't expand the hours. We've got to figure out a way to close the doors at 3:00 o'clock versus leaving them open until 10:00 at night. That's not something that anybody I think even if you work for the health care district that you want to do in this community. You want to try to take care of people because if you're not a taking care of them, they are going toafer the emergency room and we all know what's happen whg they go to the emergency room. I will tell thaw I will -- I will tell you that I will probably grin and bear it each year that this thing will ratchet up each time to where we will hit our 25-cent. It probably won't happen in this board's lifetime and probably my lifetime on the Commissioners court, but fwhoa that that is something that is going to happen because the cost of insurance and taking care of indigent health care in this country is just something that's almost impossible to do unless, of course, you're willing to tax people that can go and pay their taxes. It irkz me to some degree to have to do that, but I do feel some comfort in knowing that there are people that just absolutely can't take care of themselves and I'm willing do that and I'm willing to go to the constituency in precinct 3 and say, this is something that we have got to do. Do I look you all in the eye and say I want to get the best bang for the buck? Absolutely. I'm all for if we can take, like Commissioner Sonleitner said, we can't just watch it -- we can't watch the ratchetting up from city controlled health clinics, hopefully we can cut a deal so that we can bring those under the district's ability to manage and find a way to cost effectively do the things that we know that we need to get done. So I'm hopeful that we are going to stay vigilant and not watching the growth of this budget, and I do -- I'm very sympathetic with the fact that we probably ought to look at taking some of this out of the reserves and I do understand, because in the four years that iech been here, christian and our group has really explained to us how important it is to not have ongoing expenses being taken care of with effectively one time money that's a that's what it is.
>> but if we're going to land on half a million dollars extend of a million dollars, I think we ought to see where a million dollars gets them.
>> I'm not opposed to that.
>> this budget process is not supposed to be easy. It's not easy at the county or at the health care district. I support it had 110% and I advocated for it and committed to stand pinned it. The problem is somebody twoant the legislature and said have Travis County approve your budget. I think it puts on us a due diligence responsibility. Sild like somebody to go toafer the legislature and have that changed and have somebody else approve the budget. But as long as we're doing it, I think we nead do it the right way. There was a substitute motion to reduce the increase from 8 croarchts the effective tax rate down to six cents. Seven cents. Or a half million dollars. Instead of taking a million dollars from your budget, take a half million. All in favor that have motion? Show Commissioners Sonleitner and Daugherty. All against that motion? Show Commissioner Davis, Gomez and yours truly voting against it back to the original motion that was to ask a board to reduce the budget by one million dollars, try to minimize the impact on users of the health care district and let us know basically how that will be done next week. That's when you plan to come back to us, right?
>> yes, sir.
>> all in favor? Show Commissioners Davis, Daugherty, Gomez and yours truly voting in favor. Voting against, Commissioner Sonleitner. Thank you very much.
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Last Modified:
Tuesday, September 5, 2006 4:29 PM