the fiscal years, we still love not met the contingency part. we are working with the department, the mayor's office, and the contingency, which would mean if we had to go back we would bring more cuts for your review. it is a significant amount we still have not met through the budget. >> thank you. i will take you through our budget at a high level and talk about some of the larger and initiatives. i believe we have provided your offices with a full set of documents that went before the commission. we're happy to answer questions about those. to the extent we do not cover them now or at any time after today. looking at the big picture of

the budget, i think a couple of things to emphasize what barbara garcia pointed out. we have the reduction targets that need to make as part of the citywide effort. for the largest department we have the largest amount of general fund, and so i our share of that is significant. in addition to that, we have the challenges of meeting some of the cost growth that barbara garcia talked about, and the cost growth associated with inflation in meeting the federal requirements and milestones. the page in front of you is a summary of what our challenges are coming and how we met those challenges. at the top are the reduction targets city reductions are

$29,000,000.39999999 in the second year of the budget. the second part of the table are solutions and other costs we need to address to get the budget balanced. we have a system of the amount of the distance we needed to travel in revenues, and that is a good thing. $26 million in the first year, and 46 in the second. there are two categories i will talk about a little bit. there is also a significant amount of revenue included here that will take effort on behalf of the department by generate -- by changing the way we do business to generate additional

federal and state funds. we have $22 million worth of expenditure reductions, and then two of the three categories at the bottom that have positive numbers, those are grows in costs. inflationary is the cost of pharmaceuticals, costs for the general hospital. other cost growth. regulatory includes the cost of the expenditures to meet the federal guidelines and drawdown 45 worth of revenue. leslie, emerging needs includes implementation of electronic " but records. supervisor chu: your revenue is $26 million. target was 29. a gift you almost always there with revenue growth alone. it looks like what is happening

is your department has to absorb increases in pharmaceutical costs, the fact that there are additional expenses you have to capture, and that each of some of the revenue. >> that is exactly correct. one of the challenges we have been struggling with in terms of how we communicate with what is it in half the budget is if our reduction target is a challenge, it would be easier for us to get there, because we do have some of the revenues. because of the investments we need to make associated with the federal requirements and cost growth, those challenges are over and above reduction targets. we have the dual challenge where we are forced to make investments to keep them financially step -- financial lease sustainable, but many

definewe need to find funds els. >supervisor chu: in terms of the numbers, are they based on past legislation or practices that are already approved by either the federal or state governments that we can expect, or are there any uncertainties in them? >> that is a good question. i will talk in more details about some of the initiative. there is a piece of this that comes to us that is allocated either through operating expenses, and receive matching funds for the operating expenses, we also are receiving money through federal allocations, and we of estimates of what those are.

those come through matching dollars of the medicare waiver. those are relatively predictable. there is also a significant piece of the revenue we will have to work for and have to make operational changes to receive. this is partially predictable, but there is some uncertainty which means we will have to do things a little bit different we have seen it since the biggest swings in particularly federal spending to the department. as our broker see a mentioned cover each of the past three years we had revenue from the federal stimulus. we of the hospital quality assurance feet. big pieces of revenue that have come in and out of the budget based on federal decisions that are hard to predict, and we do our best, but it is very difficult to say with certainty

given the size of the budget and the level of revenues exactly where we will be by the end of next year. supervisor chu: tighten back to the hiv/aids presentation, it basically as soon as we lose money from the federal government to reduce expenses by that amount? >> that is correct. it is neutral in terms of general fund of dollars and the impact on this look at the budget. >supervisor chu: if we will look at anything above restoration, that would be above the fund? >> correct. supervisor chu: the provider of last resort component means we will pick up more expenses. is that included in this number? >> that is included in the

deficit projection -- the opposite reduction -- deficit reduction. it is not funded, but the cost of that is assumed in the deficit, since there is relatively little action that we can take in terms of policy decisions about whether or not that hits us. just to talk through a couple of the revenue pieces that fall into the latter category that i mentioned, there are things that were actions to generate new revenue. these are not based on federal or state policy decisions. this is trying to improve how much we draw down at the hospitals. we have a few initiatives. the first initiatives as emergency department and operational of efficiency.

we did research that shows about 10% of the visits to our emergency room end up leaving before they make it into the hospital system, and that is a bad outcome for patients come and about outcome for us in terms of being able to get patients who need to be an acute care setting. we have some investments in staffing in the budget. we agree directed vacant positions to allow us to engage people more quickly when they come into the emergency room to mixture we are getting them into the hospital. and this allows us to draw down funded with their in the hospital. supervisor wiener: is that people better in the waiting room and taking many hours so they just leave it?

>> that is essentially. either they are waiting or not to engage in a way where -- where we're giving them immediately in a place where they need to be. >supervisor wiener: is this about reducing weight times? to go it is. it is about reducing wait time and when someone comes in to make contact with the stock to have someone in gauging them immediately while they are waiting and let them know what the plan is and talking to this stuff about how to bring them in the system. it is about getting people more quickly into the hospital when they come in. supervisor wiener: what is the average wait time for the people were there could be a wait time? do we know what the average is? >> i do not have data with me on the actual length of time.

i am sure it varies significantly depending on the conditions. we did have a consultant take a look at how the wait times compared and operational differences between the hospital and others so we can look at the report and see if we have those numbers available and provide them to you. we do know there is an estimate in the report we did touch shows we have 10 percent of the 65,000 annual visits that we should be able to reduce to 2% of based on best practices. that is the goal to reduce debt by 80 percent over time. -- to reduce that by 80% overtime. supervisor chu: all these other things, it does that sound like

this is about bumping people out of their existing beds, but we want to get more bad years. >> some of the others are about the latter. on each of the next two, part of the focus of the department is not having people who do not need to be in acute-care bed in an acute-care bed. the second initiative, $4 million, when we have someone who is at san francisco general hospital who is an acute -- in need of an acute-care bed, we can draw down almost $3,000 per day. once they are no longer acute in do not need to be in that bed, we do not draw down the revenue and do not have that available for someone who needs it.

part of the department's strategy, and this has been a long, ongoing efforts but it has renewed commitment come in the budget is to try to do a better job of when we have someone who does not need to be in acute- care bed you can be seen at a lower level of care, to move them into a more appropriate environment that frees up an acute-care bed and drop down revenue. what we're trying to do in san francisco general is purchased beds of lower levels of care that are more appropriate that saves us money and allows us to draw down more revenue. similarly at laguna honda, it has been the goal of the hospital we do not want laguna hospital to be it a place to go and stay forever. the goal is to get you to a

lower level of care, back into the community as soon as possible. part of the effort here is to try to improve the flow of patients from laguna honda when we can get someone into a community-based level of care. that allows us to make better use of the beds come and to draw down more rapidly. this is the part of the strategy of looking at the health-care system as the network of a whole, not just looking at a hospital, but looking at what patient needs to be aware of the system at the right time. that has benefit financially for the hospital. >> we have the behavioral health care center that draws down a very small share of its expenditures in revenue, and we will put together a process over

the next year to look at whether we can draw down additional revenues at the behavioral health center. we have budgeted it into the second year as us and a commitment for us to work on and whether we can draw more money down at that facility. on the expenditure side, we have a list that includes items that are not on here, but we have categorized the larger value initiatives. i will touch on them briefly. feel free to ask questions. first one, we currently have outpatient rehab services of san francisco general hospital, and in the held at home program. we have an initiative to combine those programs so they can coordinate and operate more efficiently and work together, so that is what that initiative represents.

the second, which are rucker see it touched upon. -- barbara garcia touched upon. supervisor chu: you are not closing down any locations? >> it is a reduction of efficiency, and it could have an impact on the length of time people are waiting to get into rehab. the second one is a larger piece and one of the things we spend a lot of times with -- a lot of time talking to shareholders about, a reduction to the unmatched general fund contracts.

the challenge for us is a we are increasingly in a place where our decisions must be driven by the federal dollars that we are able to draw down our system of care. as we have looked at what we have a available -- what we have available to take on the expenditure side and the budget, it is pretty harsh reality that most of our services are drawing down between 2-1 match dollars up to 20-1 match dollars, and the vast majority are very highly leveraged with state and federal dollars.

the conversations are based on the planning process. it is to target reductions to services that are not drawing down those matching dollars, and that is what this initiative represents. supervisor campos. : thank you. i appreciate the presentation. and i understand your reasoning, and to appoint it makes sense, but there are populations that will never get any kind of federal money to address their needs, but you want to make sure they are protected come in many times these are some of the most vulnerable populations. you have the undocumented community where there will not be funding available for the community, but that is not to

say the kinds of programs that are serving them should be on the chopping block. i am wondering what specifically is we're talking about when we're talking about the approach, and what impact it will have on these types of services. >> it is a very good point, supervisor, and something we've spent a lot of time thinking through. i do not think there is an easy answer to it. the reality is the vast majority of the programs in some ways are torque -- are touching the very bomb rubble populations. like i said, it is not something we are happy about doing, but the choice of cutting a program is drawing down federal dollars, and one that is not, it seems of both of those are touching the very vulnerable populations. it is not an easy decision to

make, but we thought that was the most responsible thing to do. your point is very well taken. supervisor campos: i appreciate that, and i hope there is more discussion on that, because there are some groups that will never get the attention they need from the government. i do not know the extent to which the transgendered community gets much support from the federal government, but the fact that they cannot come it does not mean we should go ahead and cut those services. it means they need of the city to step in and help out. i think it could go the other way. i think we need to be mindful of that. i appreciate their predicament, but i believe it is not as simple as saying this gets federal funding, that way it is ok. >> thank you.

i asupervisor campos: i am also hoping there are some tricks you could bring to avoid cuts. i am still hoping for that. [laughter] >> high pressure. in terms of what is behind the number you see on the page in front of us, again, that is a reduction to unmatched in general fund for programs provided in an outpatient environment then ends up being up 4% reduction to those services to the overall funding for the services, for some programs that are purely unmatched general fund, and that is their only funding source. caught in some cases it is significantly higher than that. there is one of adjustment that

was made at the hall commission in response to the commissioner feedback -- at the health commission in response to the commissioner feedback. the smaller programs, many of which are unique services where there is not fall back provider for those services, we took those reductions off the list before submitting the budget. supervisor chu: this is true for the non-matched general fund? >> that is correct. supervisor chu: it is an effort to keep smaller organizations that rely heavily on funding in that way? is that something that came from the task force or was it from your commissioners? >> that was a combination of what we heard during the working

group progress, and also direct feedback from the public. we had a little bit of good revenue news, so when we made an adjustment, we took that into account and made an adjustment of that initiative. on the hiv housing subsidy program, this is a program that was cut. it is now a general-funded program. it is a little over $3 million program, so this would represent a 5% reduction to subsidies. there are a couple of reasons behind it, but primarily it has to do with the general fund, and that is the same policy discussion. in addition, there are other housing support programs that do not have abs deep of a level of

subsidy. we took this into consideration. this would have to be the negotiated out as implemented, but it would be a combination of hope fully implemented as new individuals come into the system, that there could be some impact on existing clients. i cannot imagine anyone would lose housing as a result of that reduction. the next item is on residential treatment. there are two components. as you know, as part of the realignment state initiative, there is funding initiated with that that is being used in the public safety system for parolees that are being returned to county jurisdiction, but there is also funding in the program for treatment of the individuals. that population is in many

respects the population that is in contact with our services when they are not in the criminal justice system. part of this initiative is we have been working with the adult probation department and agency is overseeing that funding, and they are going to purchase some of the capacity of the residential treatment to redirect to the realignment population. that will be using the state funding, other than general funds for those. another piece of this is we would be converting 50 beds that are residential beds into support of housing. when you look at the costs associated with those approaches of the policy direction of the city, on of -- on the cost of the residential

unit to the city, at the cost is about $2,500 per month. the support of housing in is 900-1600 a month. it is half or less of the cost. a lot of the evidence shows you can have similar outcomes with housing. it is more permanent and stable. the initiative would be to transition residential treatment beds into housing superviso. supervisor chu: in terms of outcome, they tend to be similar? >> i defer to barbara f. to go into details. -- barbara to go ointinto detai. >> there is usually about six months day. then they leave. then they get back to the

streets? what we found is a lot of people upcoming for the residential programs over and over again. we find housing is a stable in rent -- environment. in the baking get into outpatient services that are more affordable. walden has a large program and los angeles. there are facing problems -- problems for funding. it next week we meet with office of drug policy, because there is a concern that within the health care reform there is no obligation for departments like us, like i just discussed, the obligation to run the things we have for medical access. there is nothing like that for medical programming. there could be a scenario and the future that we could lose our match for residential

programs. that future is unknown. we're looking at changing some of their services and treasure island. we are working with them on that. i wanted to address the issue of the undocumented for a moment, because it is a challenging issue, but to note most of the program serve the undocumented. so if we were not to take the non-matched general fund, we will be here with and $8 million cut. most of the dollars are not attached for the undocumented. we could give you a scenario what that might look like for that amount of money, but if we brought in any of the other

cuts, it would probably be doubled the amount of people we impacted with it. supervisor kim: i just have more questions. by the way, i completely support this. we had discussions before that. oftentimes we had clients or patients but stayed longer at the very expensive hospital beds because they do not have anywhere to go come and we do not feel comfortable throwing out folks on to the street, especially because they still have needs. so in this partnership, are these in new units? >> they have units at treasure island that right now they are using for substance abuse services. they will transition the client from the programs once they complete the program, because we did not kick people out in the middle of the treatment cycle. we're still working on this, because we have months