July 24, 2006

An estimated 82,000 adult residents in the city and county of San Francisco lack health insurance. These residents have limited access to routine preventative care, suffer from poorer health outcomes, delay seeking treatment when ill and ultimately rely on more costly episodic or emergency care for health conditions that could be treated in primary care settings. The lack of health insurance negatively impacts individuals both in terms of health status and financially. It also takes a toll on the health care delivery system, tax payers, and society.

Continuing to serve uninsured residents in an episodic, fragmented delivery system is inefficient, costly and counter to the notion of improving health status. Adequately providing services to this population must be viewed within a larger policy and programmatic framework that examines the financing and delivery of health services across all providers in the public and non-profit sectors. San Fracisco Mayor Gavin Newsom created and seated the Universal Healthcare Council (UHC) to further the goal of expanding access to health services.

The UHC was charged with developing the parameters of a program that will provide healthcare to all uninsured. The UHC is a collaborative effort with representatives from health care, business, labor, advocacy organizations, philanthropy, research, and other disciplines. Central to the context of a collaborative effort is the notion of collective responsibility. The UHC strongly believes that expanding access to the uninsured requires participation from all interested parties – individuals, employers, providers, and the government.

The plan and purpose of the UHC is to:

• Adopt a vision statement and set of guiding principles.

• Develop a common understanding of uninsured adults with respect to demographics, employment status and service utilization.

• Propose a mechanism to expand health access to uninsured residents including financing structure.

• Estimate the costs of expanded access to uninsured residents.

• Identify the various implementation issues related to expanded access to uninsured residents.

The goal of the program is to give San Francisco residents access to comprehensive health services and a “medical home.” Such a program should enhance health and well-being by promoting access to high-quality care that is effective, efficient, safe, timely, patient-centered, and equitable.

In San Francisco, it is estimated that 82,000 adults between the ages of 18 and 64 are uninsured. It is important to recognize that few if any of those uninsured (employed or unemployed) qualify for publicly-funded health coverage. California’s Medi-Cal program provides medical assistance to certain individuals and families with low incomes and resources. However, having low-income does not automatically qualify individuals for the program. Only persons meeting certain eligibility requirements qualify such as children, pregnant women, persons with disabilities, etc. A relatively healthy, low-to-moderate income, working, uninsured adult is not eligible for Medi-Cal.

As a result, when uninsured adults need health services, they access a variety of systems: community clinics, public clinics and hospitals, non-profit hospitals providing charity care, and private providers. Due to their uninsured status, they access services in an episodic manner. Some may receive only emergency services at a hospital while others may have a more longstanding provider at a community clinic. In addition, uninsured residents may use multiple providers to get the services they need. The service delivery and financing systems for the uninsured are an inefficient and under-resourced patchwork that leaves providers confused and patients vulnerable.

As part of its work, the UHC examined the number of uninsured who utilize the following safety net systems:

• San Francisco Department of Public Health

• San Francisco Community Clinic Consortium

• Hospital Charity Care

• Services for the Uninsured

Demographic, service utilization, cost and financing data were collected. Estimated costs are based primarily on an actuarial analysis, which projected service utilization for the adult uninsured population. The predicted costs were derived based on the demographic characteristics of the estimated 82,000 uninsured adults in San Francisco. In addition to demographic information, the analysis took into account: (1) a scope of benefits and (2) a two-tiered co-payment structure based on family income. The actuarial analysis provides a broad estimate of potential utilization and costs of SF HAP; it is by no means definitive.

Point of service charges (i.e., co-payments) were implemented based on income. Studies indicated that the estimated annual cost (in 2006 dollars) of services through SF HAP is $2,415 per person.

UHC has identified the following implementation issues:

• Creation of an implementation work group.

• Development and adoption of City and County legislation creating the San Francisco Health Access Program (if necessary).

• Targeted discussions with the business and labor communities to ascertain the impact of participation in SF HAP on local businesses and their employees.

• Hold focus groups with key stakeholders to determine whether the proposed SF HAP would be attractive to: (1) San Francisco employers who do not provide health insurance to their employees and (2) uninsured San Francisco residents.

• Develop and enter into contractual obligations with a provider network, identify the phase-in populations.

• Ascertain long-term financing and distribution of financial risk.

• Assess the potential to leverage additional funds and secure said funds.

All San Francisco residents are eligible for the program regardless of employment or immigration status. In order to join the SF HAP, an individual must be uninsured, live in San Francisco, and be willing to apply for state and federal health benefits for which s/he is eligible. SF HAP will begin a phased-in implementation scheduled for 2007.

For more information, contact Julian Potter, Director of Public Policy at 415-554-6502 or send e-mail to JulianPotter@sfgov.org