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 Hubert B. Shih, M.D. to Provide Plastic Surgery Services
RECOMMENDATION:
title
Adopt a resolution authorizing an agreement with Hubert B. Shih, M.D. to provide plastic surgery services, for the term of December 1, 2025 through November 30, 2028 in an amount not to exceed $2,880,288.
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BACKGROUND:
Since 2018 San Mateo County has contracted with Dr. Shih to provide outpatient and emergent plastic surgery services at San Mateo Medical Center (“SMMC”) to meet community need. Over the past three years, Dr. Shih’s contract for plastic surgery coverage at SMMC evolved in response to his colleague, Dr. Kenton Fong, stepping back to pursue private business ventures. Dr. Shih’s previous agreement was amended to expand Dr. Shih’s services to prevent coverage gaps. The proposed agreement would continue Dr. Shih’s expanded coverage as the sole physician who meets community needs for plastic surgery services. Plastic surgery is routinely utilized by health systems to help patients heal from traumatic injuries, complicated surgeries, and burns. Dr. Shih is currently the County’s sole provider of independently contracted plastic surgery services.
DISCUSSION:
Under the previous contract - after an amendment to fill hours created by Dr. Fong’s departure - Dr. Shih agreed to provide 96 four-hour outpatient clinic blocks annually at a rate of $294 per hour, 192 four-hour operating room coverage blocks annually at $294 per hour, up to 342 hours of supplemental clinical services (which included surgery) annually at $294 per hour, 10 hours of medical director coverage monthly at $269 per hour, and 338 24-hour unrestricted on-call shifts annually at $48.52 per hour. The “not to exceed” amount of the prior amended agreement was $1,934,413.
Under the proposed agreement, Dr. Shih’s total hours of outpatient clinic block and operating room coverage remain unchanged and may be exchanged interchangeably to meet patient care demands. Dr. Shih’s supplemental clinical services hours will increase from 342 hours to 600 hours annually. Collectively, the rate for these clinical services is increasing from $294 per hour to $343 per hour. Dr. Shih will also continue to provide 10 hours per month of medical director services, but his hourly rate will increase from $269 per hour to $343 per hour. On call coverage shifts will remain the same at 338 shifts annually, but Dr. Shih’s hourly rate will increase nominally to $50 per hour. Because Dr. Shih will not be allowed to be paid to be on-call while he is in clinic or in surgery, the proposed agreement will not exceed $2,880,288.
The rates in the new contract are within fair market value according to VMG Health, a nationally recognized medical services valuation firm that relies upon multiple industry-standard provider compensation surveys and aggregates that data.
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).
It is anticipated that 80% of Dr. Shih’s patients who admit to using tobacco will receive documented tobacco cessation counseling.
PERFORMANCE MEASURE:
|
Measure |
FY 2025-26 Estimated |
FY 2026-27 Projected |
|
Percentage of Dr. Shih’s patients who admit to using tobacco will receive documented tobacco cessation counseling |
80% |
80% |
COMMUNITY IMPACT:
Dr. Shih’s continued plastic surgery coverage will positively impact health outcomes because delivery of plastic surgery services at SMMC, a public safety net hospital, addresses community need in cases of traumatic injury, complicated surgeries, and burns. 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%). SMMC strives to eliminate bias in the medical profession by providing culturally competent training to its physicians and by following up with patients to ensure that they continue to have access to specialized care. SMMC specifically tracks physician satisfaction survey results and requires Dr. Shih to meet with SMMC and discuss patient feedback to improve patient satisfaction and remove potential barriers to care.
FISCAL IMPACT:
The term of the agreement is December 1, 2025 through November 30, 2028. The amount of the agreement is not to exceed $2,880,288 for the three-year term. Funds in the amount of $960,096 are included in the SMMC FY 2025-26 Adopted Budget. Similar arrangements will be made for future years.
The payment provisions and levels of services in this contract differ from those of the previous contract due to an increase in the hourly rate for clinical, operative, and supplemental services, and due to an increase in the annual hours of supplemental clinical services. Comparing Dr. Shih’s prior contract “not to exceed” amount to the proposed agreement’s, the total increase in cost is estimated to be 48%, but that captures a substantial increase in clinical and supplemental services hours. In terms of current annual accrual after Dr. Fong’s departure, SMMC is currently spending approximately $61,000 per month to maintain Dr. Shih’s coverage, so the actual annual increase is expected to be 31% based on present accrual inclusive of the large increase in supplemental clinical services hours.
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.