to -- outside the walls of the hospital. >> this may be the bridge to the next subject. within these -- and i think this is color coded too, right? >> yes. it is. >> so we got to get color presentations because these don't quite come out in black and white, but we're going to go from red to green, but we're talking about in the budget to be presented this afternoon as the next item, are the items that you need funded within this to do the 014 through 2015 structure? >> yes commissioner, i believe that the budget i have discussed with the cfo and the executives does support everything we need to do for 2014 and through '15.

now, could we use more? absolutely. but i believe we have enough to have a good running start. >> no. that is enough to do what you are putting on paper here and getting us into the effective it clinical and due diligence. we're not going to hear in december that suddenly you need 50 more people or so? >> no. what will most likely happen is this time next year when we're doing the budget i will have a better picture and will say i won't need as much or will need more. but this depends largely on what i know today. there's quite a bit of work to do. having said that there's a lot of transition and change within the city. for example, we no longer are planning to house all of our servers in our own data center unless the servers is required for emergency situations such as a pack system in the event of a earthquake and where the

building's isolated. we don't really need a server hosted there. that means we can save significant amount of money by hosting it within the san francisco's data center which we have a system for. as those things come online or financial operational cost will change. that's not to say it'll come out of a lump sum saving. more likely it will have to be redistributed in the clinical area. >> and therefore for the items we're going to be looking at really don't speak to 2016 through 2018 yet. >> yes. . >> that's what you clearly put as after having put infrastructure. >> that's right. >> thanks for the questions. there might be some coming up later so if you're able to stay -- >> i will stay and wait for

your questions. >> thank you very much for the presentation and we'll look forward to its implementation. shall we call the next item please? >> yes, the next item is the dph budget for the fiscal year 2015 to '16. >> i'm going to go through some of the details and then have the staff from the divisions in the room to answer questions for you. i think in terms of context for

this budget we're going into '14, '15 budget year with a projected budget for $1.9 million currently in negotiation, other items that move between now and the mayor's budget submission on june 1 but that's about where we are. i think we're at a moment of brief calm in the eye of the storm here in terms of our finances and that's largely thankful to two things that have given us a brief window to assess and plan for the next coming years. the first is that in last year's budget cycle the mayor's budget included as we discussed here a major investment in the health department to correct

our structural salary imbalance. that was on the order of a $50 million recollection which means for the first time in this year we're not grappling to get back to zero before we start planning for our budget. that has created some relief for the department. the second is that in the up coming budget for '14, '15 and '15, '16, the mayor's office has absorbed the state take bake of back of our realignment dollars, that's the $35 million revenue lost that the state will be recooping in anticipation of health reform. had we been asked to balance around that revenue loss we'd be in a very different place today so i think it's important for us to keep that in context about what the commitment that the city has had to the health department in terms of putting us in a place where we're on, for the moment, stable footing.

but what we do need to do is now -- because we we have a moment to breathe is plan for what's ahead and what's really ahead for us, as we all know, is the affordable care act and the fact that our revenues will come to us in very different ways. we will have to be a provider of choice, we'll be in a more competitive environment and it will be on us to make sure we take the steps that we need to to preserve and protect our revenues and therefore our system of care. so that's the context that we have used to guide this budget. we've spent the last three years, really, going through a number of strategic planning processes in anticipation of the aca, we had the integrated delivery system planning process. we had the h ma planning

process over the past year to 18 months, we had the it strategic planning process and process through this commission for our five year financial planning priorities and all of these processes we've tried to use those to channel what initiatives are going into this budget submission and i think we have done a prudent, but targeted job of trying to channel our efforts through the budget that's if front of you. a couple of quick comments that is fairly significant that is going to change a little bit at your next meeting because we notice that there's one of the initiatives that doesn't have the fd con associated with it, but it is a 1 percent change in

our fte positions. we'll get you some numbers on this, but we are recovering. if you look at our fte history, there has been a dip over the last several years as we went through the difficult financial times and we're recovering some of that, but we're trying to do it in targeted ways so we're making investments in our department infrastructure that will allow us to be a provider of choice and protect our revenues and our system of care. with that, i will turn it over to jen to walk through the presentation. >> afternoon commissioners, i think these first two slides, greg just went over, but this is the context for our budget

where we talk about what we don't face an immediate financial crisis, we need to make investments in our system to make sure we are successful if in an era of healthcare reform. just using the modest revenue growth that we project we are going to invest to make us stronger. without further a do, i'll go into the details of the initiative. first off is baseline revenue growth at san francisco general is projected at approximately 17 million for the next two fiscal years. again, this does not include the 33.8 million of the state realignment reduction that we are also expecting. again, this was included in the mayor's projected deficit so we are not responsible for that so this allows us to put $17 million towards our balancing

and towards our target. second we have laguna honda baseline revenue growth. the revenue growth is primarily driven by two major state policy changes. first and foremost is that the governor jerry brown rescinded a proposed rate cut that he had put into his budget several years ago so while he did not retroactively give us the money back moving forward we can expect increases in revenue. secondly the state also changed how it actually reimbursed us for our cost. previously it had been based on three-year-old cost reports and they waited for the authors of the financials and then paid us accordingly so we are always three years behind in our costs. now they've changed their reimbursement policy so it can actually be based on the most recent closed financial statements despite the fact

they're audited and they'd true up those payments down the road. obviously just more recent costs tend to be higher because they reflect the true cost of business, but also more importantly for us, three years ago wrp we were not in our new facility at that point, which is actually more expensive so this is a one time catch up payment that is ongoing but i don't think we can expect this type of growth in our laguna honda revenues. , you know, without any additional major policy changes. one of my goals as budget director for the next three years is to right size our budget and true it up so it reflects reality of our operations and actuals. so initiative a-3 takes a stab at that where we're just adjusting some of our revenues in primary care and public health. public health historically has

been running short of its revenues. it's also been running short of its expenditures. we're hoping to change the expenditure so i want to adjust the revenue part down to get us closer to reality. on the public health side we have a few areas in the immunization travel clinic and the std clinic which hasn't quite been hitting its revenues. i want to make that adjustment and invest in our public health system. we are back filling some of the from the cdc related to control to make sure we are doing everything we can to prevent the spread of that disease. on the reduction side, they're all actually coming from san francisco general this year so -- and there's two components to it. the first is related to the use

affiliation agreement. similar to san francisco general, they are projecting increases and fee for service and rates due to a large number of our patients transferring from low income health program or no insurance to med-cal. that will allow them to capture payments on their end so they can, for the next two years, cover their projected cola increase. because we had budgeted an increase in the prior two years we can reduce that expenditure for saving. we're going benchmark for san francisco general to improve efficiency and patient flow, then we will actually see an increase in revenues and consequently they will qualify for a million dollar bonus payment in year 15, 16 based on

14, 15 performance. the second part of the savings is related to salary savings as san francisco general. right now it looks quite positive. it won't fully correct all the problems in those areas but i think it's a start to true it up and allow managers to get a better sense of what they're managing around. i'll use $2 million of savings for that and apply $3 million of salary savings to offset [inaudible]. i apologize, i neglected to include initiatives b-1 which is on your summaries, but i forgot to include this as part of my presentation, but there is one regulatory initiative that's on your summary and it's

not insignificant. it is related to electronic medical records and meaningful use, which is what bill kim just spoke about. it is $3.8 million and i think we've discussed that enough , but feel free to ask any questions. moving forward to our revenue neutral initiatives, we have an increase in behavioral health services that's supported by 2011 realignment funding. we're proposing to use this towards three areas, first is support the kda settlement complaints. again, kda is now a state mandate to provide additional mental health services for foster kids for kids who can -- who have actually qualify. dph is currently in the process of evaluating as many kids as we are familiar with to see

what types of services they'll provide, but in addition there they be some kids we haven't seen or touched so this is a little bit of an unknown but we're putting investment to make sure we provide the services they need. secondly we're going to use this revenue to support our mental health clinics by restoring our clinic directors and continue this initiative that we also had in the previous year. our goal was to restore a few over several years and so we're going to continue that initiative. and finally we are going to invest in our infrastructure support compliance and reporting, with just additional requirements for drug med cal, we need to support our providers to be able to handle the state's reporting systems and make sure we're billing accurately.

this helps preserve our revenues and so that we don't get dinged on claims further down the road and will facilitate the process with providers to actually be able to bill more effectively and use the system in a meaningful way. in addition to billing system, it has clinical data in it and we'd like that data to be as clean as possible so we can revisit that down the road. next is a change in maternal health funding. we got approval from the state to shift our target at management program to the state's maternal child health program. what this does is allows us to reduce some of the administrative burden because the reporting requirements for targeted case management was quite significant. in addition the reimbursement rate under maternal child health is a little more robust so it enables us to reduce our

some of those public health field nurses to provide services under the nurse family partnership. and this is a more robust, intensive and preventive model of care where we actually do more intensive case management and we work more closely with high risk clients. it's actually evidence based and we have evidence to show there's improvement in outcomes and so we want to sort of put our resources into that. we will still continue a lot of the field nursing work that we're doing, but we just want to be focus more on the outcomes for our patients. next at laguna honda rehab and home health we're going to make some changes to vacant positions to increase our productivity there and also help improve discharges from

laguna honda. the new health clinic, we're looking at the possibility of renting a clinic space somewhere on market street. it's a centrally located area and it's actually currently has primary care clinic and pharmacy in its location so if we were actually able to lease this space it would be turnkey and we could actually get primary care and pharmacy services in right away. what this will do is that it will enable us to reduce some of our panel sides at other clinics, particularly at san francisco general, and will actually -- and allow them to increase their revenues so they could pick up additional members at those sites. our hope is that we can come to agreement on this space and we think we can actually -- if we do, we would have the revenues to offset this expenditure,

but if this plan would fall three through we wouldn't have the expenditure or revenue. the next thing is the services provided at san francisco general. there's a number of ancillary services provided by ucsf that are billable so we're going to true it up based on actuals and request of $1.2 million increase in affiliation agreement offset by revenues. 11 is a pharmacist to support some of our patients who are anti blood thinners. you know, there cease on the significant on those medications and what this will do is have a pharmacist run a clinic that will help patients

more understand the medications to review the dosage and ensure -- or try to minimize the number of hospitalizations for patients on this medication. finally our fiscal intermediary conversions, a true of where we're seeing that there's some services that would be more effectively provided in house and more appropriate and we'll do a neutral conversion of reducing contract dollars to help pay for those services. moving on to the newer initiatives, first and foremost is the sf health network call center. this is a proposal to create a centralized call center that will support scheduling appointments and general inquiries for initially the primary care clinics. this was one of mm-mma's major

recommendations and it's becoming standard for most health networks to have a centralized call center. our goal for this is to -- several things -- first to improve the productivity and efficiency of our primary care clinics because that allows us to schedule optimally to make sure we can fill as many appointments as we can. secondly it will take the burden off existing clinic staff so instead of answering phones while someone's waiting to get checked in, they can move someone along and support their providers and not be on the phone all the time. and this will also help the patient satisfaction and because one, patients at clinics are actually going to be seen or could be addressed more quickly and that our goal with the telephone access is that phone calls be answered

within three minutes and so they will actually be able to get a live person right away and this will also enable us to consolidate some of our language services in one call center so make sure that we have as many languages available to our patients at one time. we'll do half our clinics in 14, 15, and the second half in 15, 16. the call center will be located at laguna honda and our goal would be to consolidate the appointment scheduling function with the nurse advice line and then upon successful completion of primary care scheduling we'd want to add mental health and specialty clinics down the road.

the next four are related to it, the security enhancements that bill kind of talked about, the things that will support the implementation of new technology and technology upgrades, the tell help upgrades and investment in information technology infrasfrukture so i won't go anymore detail about them. next is investments in human resources. you can't invest in all these initiatives, which does, you know, take a significant number of staff without actually looking at our hr. to ensure that we are filling our vacancies in a timely manner so that we don't lose any productivity and we continue to provide services, we need to invest in our hr

department. this will add it is a medical

director for utilization management. it's a clinical operations director for ambulatory care.

we are no proposing at this time and they are fine with that. but what all our proposed changes it looks like we have some positive news in the first year and we have cost increases in the second year so basically we're about 14 million towards or $21 million target so we're about 7 million short but we've been working with the mayor's office and they're satisfy wd this proposal and are not asking us for additional

contingency proposals at this time. while it does look like there's significant revenue growth, this does not include the realignment reduction from the state that we'll be reflected around budget. and just as a reminder there's some other changes that are in our budget that are not included in our balancing plan. first is the community program's reduction that was approved in the 13, 15 budget process. we have an $8.8 million reduction in 14, 15 and it annualized to 17.7 million in fiscal year 15, 16. right now that still remains in our budget. i am projecting a potential $3 million reduction to hiv funding in the areas of brian white funding and cdc funding for hiv prevention. these are still projections at this time. we've gotten preliminary heads up that there's going to be a

reduction coming, but have not received final notification so this is still a little bit of an unknown but it's possible it could be as high as 3 million. and lastly as we mentioned before, the 33.8 million in state realignment reductions. so in terms of next steps, there's some corrections to these dates. our next health commission meeting will be on may 6 and then following that we'll actually have a hearing at the board's budget and finance committee where they want to hold a preview hearing for our budget. on june 1 the may or will have his balance budget commission and we'll start the board review process and the finance committee is expected to improve by mid july we expect approval of the new budget.

that's all i have and i'm happy to answer any questions you guys have. >> is there any public comment? >> i have not received any requests for public comment. >> we'll go on to commissioner questions. i'm sorry. if someone would like to speak, they can and just give me a card. i have not received any public comment requests. >> if someone has a public comment to make before the commissioners --