Special Notice / Hearing: None__
Vote Required: Majority
To: Honorable Board of Supervisors
From: Colleen Chawla, Chief, San Mateo County Health
Chester J. Kunnappilly, MD, Chief Executive Officer, San Mateo Medical Center
Subject: Agreement with Quest Diagnostics to Provide Diagnostic Laboratory Testing Services
RECOMMENDATION:
title
Adopt a resolution authorizing an agreement with Quest Diagnostics for diagnostic laboratory reference testing services, for the term of November 1, 2025 through October 31, 2030, in an amount not to exceed $7,750,000.
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BACKGROUND:
San Mateo Medical Center (SMMC) has been contracting with Quest Diagnostics (Quest) since 2003 to perform laboratory reference testing services. Quest Diagnostics fills a laboratory testing gap by performing specific tests that SMMC’s laboratory cannot perform at a reasonable cost. Quest is a member of SMMC’s Group Purchasing Organization, Vizient, that ensures competitive pricing by conducting its own Request for Proposals for maximum savings. On January 31, 2023, this Board approved an agreement with Vizient to provide group purchasing organization program services to SMMC, including access to competitive pricing with vendors like Quest.
DISCUSSION:
SMMC continues to have a critical need for laboratory reference testing. It would be economically prudent and least operationally disruptive to continue to contract with Quest for laboratory reference testing services. The proposed agreement was sourced through the County’s group purchasing organization, Vizient, to obtain favorable pricing terms. This agreement is going to this Board late due to prolonged negotiations with the vendor.
The County Attorney has reviewed and approved the resolution and agreement as to form.
The resolution contains the County’s standard provisions allowing amendment of the County fiscal obligations by a maximum of $25,000 (in aggregate).
The Information Services Department has reviewed and approved the IT component of this agreement.
It is anticipated that laboratory reference testing results will be returned to the lab for analysis within 48 hours from the time of pick up 100% of the time.
PERFORMANCE MEASURE:
|
Measure |
FY 2024-25 Actual |
FY 2025-26 Estimated |
|
Percentage of time laboratory reference testing results will be returned to the lab for analysis within 48 hours from the time of pick-up |
100% |
100% |
COMMUNITY IMPACT:
With this partnership with Quest, SMMC, a public safety net hospital, will continue to be able to address community needs. SMMC’s patients span a wide spectrum of races, ethnicities, gender, and gender-identities. Within the past 18 months, the largest cohorts of specialty care patients at SMMC were female (52%), Hispanic or Latino (63%), and primarily Spanish-speaking (55%). By delivering timely and accurate testing results, SMMC will be able to provide earlier diagnoses and better outcomes to our patients while reducing disparities of vulnerable communities.
FISCAL IMPACT:
The term of the agreement is November 1, 2025 through October 31, 2030. The amount of the agreement is not to exceed $7,750,000 for the five-year term. Funds in the amount of $1,033,333 are included in the SMMC FY 2025-26 Adopted Budget. Funds in the amount of $1,550,000 will be included in the SMMC FY 2026-27 Recommended Budget.
The payment provisions and levels of services are exactly the same as the previous agreement.
Expenses at SMMC are covered by fees for services or third-party payors whenever possible. The portion of expenses for services provided to the medically indigent or to those covered by programs that do not meet the full costs of care is covered by the County’s General Fund contribution to SMMC and is within the existing annual appropriation.