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 Peninsula Pathologists Medical Group, Inc. to Provide Pathology Services
RECOMMENDATION:
title
Adopt a resolution authorizing an agreement with Peninsula Pathologists Medical Group, Inc. to provide pathology services, for the term of September 1, 2025 through August 31, 2028, in an amount not to exceed $2,600,000.
body
BACKGROUND:
San Mateo County provides necessary medical care to financially vulnerable patients. Peninsula Pathologists Medical Group, Inc. (PPMG) provides professional and nonprofessional pathology services to San Mateo Medical Center (SMMC) and has done so since 2005. PPMG provides anatomic and clinical pathology services, including technical and medical director services. Technical services refer to certain pathology laboratory equipment, supplies, and personnel provided to SMMC, so that needed anatomic and clinical pathology services can be rendered. To support maintenance of its state hospital license, SMMC is obligated to offer pathology services as a component of operating its clinical laboratory under “Title 22” (22 Cal. Code Regs. § 70243(c)).
DISCUSSION:
SMMC and PPMG have agreed in principle to renew PPMG’s contract for another three-year term on the same terms as the expiring agreement between the parties, except that Medical Director duties in the proposed agreement will be revised and clarified. The present $866,104 annual cost of the contract will remain the same and will not increase during the upcoming term of the renewed agreement.
The rates in the proposed renewed 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 the Contractor will pick up samples three times per day and the turnaround time (TAT) of 7 days for analysis will be met without sacrificing quality of the analysis 100% of the time.
PERFORMANCE MEASURE:
|
Measure |
FY 2025-26 Estimated |
FY 2025-26 Projected |
|
Percentage of time the Contractor picks up samples three times per day and the TAT of 7 days is met without sacrificing quality of the analysis |
100% |
100% |
COMMUNITY IMPACT:
PPMG’s continued clinical and anatomical pathology coverage will positively impact health outcomes because delivery of pathology services at SMMC, a public safety net hospital, is required. 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 competent training to its physicians and by following up with patients to ensure that they continue to have access to specialized care.
FISCAL IMPACT:
The term of the agreement is September 1, 2025 through August 31, 2028. The amount of the agreement is not to exceed $2,600,000 for the three-year term. Annual cost of the proposed arrangement is $866,104. Funds in the amount of $866,104 are included in the SMMC FY 2025-26 Adopted Budget. Funds in the amount of $866,104 are included in the SMMC FY 2026-27 Adopted Budget. The same arrangement will be made for future years.
The payment provisions and levels of services in the renewed pathology agreement remain the same as the previous contract, with no increase in cost.
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.