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April 9, 2019
TO: Honorable Mayor and Members of the City Council
THRU: Rick Otto, City Manager
FROM: Will Kolbow, ' istrative Services Director �;,�
REVIEW: City Ma ger Finance��� '
1 . SUBJECT
First Amendment to Intergovernmental Agreement Regarding Transfer of Public Funds
(Contract#16-93672) and Intergovernmental Assessment Fee (Contract#16-93703) with
the California Department of Health Care Services.
2. SUMMARY
First Amendment to Intergovernmental Agreement Regarding Transfer of Public Funds
(Contract#16-93672) and Intergovernmental Assessment Fee (Contract#16-93703) with
the California Department of Health Care Services for the City's Fiscal Year 2016-2017
Rate Range Program.
3. RECOMMENDED ACTION
Approve First Amendment with the California Department of Health Care Services and
authorize the Mayor and City Clerk to execute the amendment on behalf of the City.
4. FISCAL IMPACT
None.
5. STRATEGIC PLAN GOALS
Goal 2: Be a fiscally healthy community
b: Analyze future fiscal needs and potential revenue opportunities.
6. DISCUSSION AND BACKGROUND
With the expansion of Medi-Cal managed care (MCMC) enrollment, there are fewer Medi-
Cal fee-for-service transports available; as such, cost recovery opportunities for EMS
providers are beginning to diversify. Since 2006, the California Department of Health Care
Services (DHCS) has offered a program which increases reimbursement for services
provided to MCMC plan members. In 2015, this program expanded to include public EMS
providers.
ITEM 3•� � 04/09/2019
An Intergovernmental Transfer (IGT) allows California's Medi-Cal managed care plans to
partner with local units of government to access additional federal Medicaid dollars and
use them to support unreimbursed care and provide health care services. The California
Department of Health Care Services (DHCS) and Cal Optima facilitate the program. Since
the City provides ambulance transport services and has unreimbursed Medicaid
expenses, it is eligible to participate in the IGT program and has done so every year since
Fiscal Year 2014-2015 (FY15).
Additional Recovered Funds are as follows:
Fiscal Year 2014-2015 (FY15) $ 140.398
Fiscal Year 2015-2016 (FY16) $ 152,701
Fiscal Year 2016-2017 (FY17) $ 180,956
To facilitate the reconciliation process for the FY17 Rate Range Program, DHCS has
requested the existing agreements be extended through December 31, 2020. All related
funds have been paid and the amendment is merely to allow DHCS sufficient time to wrap
up the applicable fiscal year.
Consistent with State contract requirements, the amendment to contract 16-93672
extends the term only and will attach a "restated" agreement with strike-
throughs. Contract 16-93703 is amended to revise only the related contract number 16-
93672 to add an "A1".
7. ATTACHMENTS
1. First Amendment to Intergovernmental Agreement Regarding Transfer of Public
Funds (Contract #16-93672).
2. First Amendment to Intergovernmental Assessment Fee (Contract #16-93703).
ITEM 2 04/09/2019
FIR5T AMENDMENT
TO CONTRACT#16-93672
INTERGOVERNMENTAL AGREEMENT REGARDING
TRANSFER OF PUBLIC FUNDS
This First Amendment to Intergovernmental Agreement Regarding Transfer of Public Funds
(the "First Amendment") is made and entered into as of , 2019, by and between
the CALIFORNIA DEPARTMENT OF HEALTH CARE SERVICES ("DHCS") and the CITY OF
ORANGE, a California municipal corporation operating through its Fire Department ("City") with
respect to the matters set forth below:
A. DHCS and City entered into the Intergovernmental Agreement Regarding Transfer of
Public Funds (Contract #16-93672) dated as of May 23, 2017, which is incorporated herein by this
reference (the "Original Agreement"); and
B. DHCS and City desire to amend the Original Agreement to extend the term.
NOW, THEREFORE,the parties hereby agree as follows:
1. Section 8, "Term," is amended to extend the expiration date until December 31, 2020.
2. Except as amended herein, all other terms and conditions of the Original Agreement
remain in full force and effect.
3. A restated Original Agreement, with the revised term, in attached hereto and
� incorporated herein.
SIGNATURES
IN WITNESS of this First Amendment, the parties enter into this First Amendment on the
year and day first above written.
THE CITY OF OR.ANGE
By: Date:
MARK A. MURPHY, MAYOR
�
ATTEST:
Pamela Coleman, City Clerk
APPROVED AS TO FORM: �
Mary E. Binning, Sr. Assistant City Attorney
THE STATE OF CALIFORNIA, DEPARTMENT OF HEALTH CARE SERVICES:
By: Date:
Jennifer Lopez, Acting Division Chief, Capitated Rates Development Division
�
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INTERGOVERNMENTAL AGREEMENT REGARDING
TRANSFER OF PUBLIC FUNDS
This Agreement is entered into between the CALIFORNIA DEPARTMENT OF HEALTH CARE
.SERVICES ("DHCS") and the City of Orange, a California municipal corporation operating through its
Fire Department (GOVERNMENTAL FIJNDING ENTITY)with respect to the matters set forth below.
RECITALS
A. This Agreement is made pursuant to the authority of Welfare &Institutions Code, sections
14164 and 14301.4.
B. The CalOptima(HEALTH PLAN) is a public agency formed pursuant to California
Welfare and Institutions Code section 14087.54 and Orange County Ordinance No. 3896 as amended by
Ordinance Nos. 008-8, OS-008, 06-012, 09-001, 11-013, 14-002, and 16-001. HEALTH PLAN is a party
to a Medi-Cal managed care contract with DHCS, entered into pursuant to Welfare and Institutions Code
section 14087.3, under which HEALTH PLAN arranges and pays for the provision of covered Medi-Cal
health care services to eligible Medi-Cal members residing in the County.
THEREFORE, the parties agree as follows:
AGREEMENT
1. Transfer of Public Funds
1.1 The GOVERNMENT FUNDING ENTITY shall transfer funds to DHCS pursuant
to sections 14164 and 14301.4 of the Welfare and Institutions Code,up to a maximum total amount of
two-hundred forty-nine thousand, three-hundred ninety-three dollars ($249,393) for the period of July 1,
2015 through June 30, 2016, and a maximum total amount of three-hundred forty-five thousand, seven-
hundred ten dollars ($345,710) for the period of July 1, 2016 through June 30, 2017, to be used solely as a
portion of the nonfederal share of actuarially sound Medi-Cal managed care capitation rate increases for
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HEALTH PLAN for the periods of July 1, 2015 through June 30, 2016, and July 1, 2016 through June 30,
2017 as described in section 2.2 below. The funds shall be transferred in accordance with a mutually
agreed upon schedule between the GOVERNMENTAL FUNDING ENTITY and DHCS, in the amounts
specified therein.
1.2 The GOVERNMENTAL FLTNDING ENTITY shall certify that the funds
transferred qualify for federal financial participation pursuant to 42 C.F.R. part 433 subpart B, and are not
derived from impermissible sources such as recycled Medicaid payments, federal money excluded from
use as State match, impermissible taxes, and non-bona fide provider-related donations. For transferring
units of government that are also direct service providers, impermissible sources do not include patient
care or other revenue received from programs such as Medicare or Medicaid to the extent that the
program revenue is not obligated to the State as the source of funding.
2. Acceptance and Use of Transferred Funds by DHCS
2.1 DHCS shall exercise its authority under section 14164 of the Welfare and
Institutions Code to accept funds transferred by the GOVERNMENTAL FiTNDING ENTITY pursuant to
this Agreement as intergovernmental transfers ("IGTs"), to use for the purpose set forth in section 2.2
below.
2.2 The funds transferred by the GOVERNMENTAL FUNDING ENTITY pursuant to
this Agreement shall be used to fund a portion of the nonfederal share of increases in Medi-Cal managed
care actuarially sound capitation rates described in paragraph(4) of subdivision(b) of section 14301.4 of
the Welfare and Institutions Code and shall be paid, together with the related federal financial
participation,by DHCS to HEALTH PLAN as part of HEALTH PLAN'S capitation rates for the periods
of July 1, 2015 through June 30, 2016 and July 1, 2016 through June 30, 2017. The rate increases paid
under section 2.2 shall be used for payments related to Medi-Cal services rendered to Medi-Cal
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beneficiaries. The rate increases paid under this section 2.2 shall be in addition to, and shall not replace or
supplant, all other amounts paid or payable by DHCS or other State agencies to HEALTH PLAN.
2.3 DHCS shall seek federal financial participation for the rate increases specified in
section 2.2 to the full extent permitted by federal law.
2.4 The parties acknowledge the State DHCS will obtain any necessary approvals
from the Centers for Medicare and Medicaid Services prior to the payrnent of any rate increase pursuant
to section 2.2.
2.5 The parties agree that none of these funds, either GOVERNMENTAL FUNDING
ENTITY or federal matching funds will be recycled back to the GOVERMENTAL FITNDING
ENTITY'S general fund, the State, or any other intermediary organization. Payments made by the
HEALTH PLAN to providers under the terms of this Agreement and their provider agreement constitute
patient care revenues.
2.6 Within One Hundred Twenty(120) calendar days of the execution of this
Agreement, DHCS shall advise the GOVERNMENTAL FLTNDING ENTITY and HEALTH PLAN of the
amount of the Medi-Cal managed care capitation rate increases that DHCS paid to HEALTH PLAN
during the applicable rate year involving any funding under the terms of this Agreement.
2.7 If any portion of the funds transferred by the GOVERNMENTAL FUNDING
ENTITY pursuant to this Agreement is not expended for the specified rate increases under Section 2.2,
DHCS shall return the unexpended funds to the GOVERNMENTAL FUNDING ENTITY.
3. Amendments
3.1 No amendment or modification to this Agreement shall be binding on either party
unless made in writing and executed by both parties.
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3.2 The parties shall negotiate in good faith to amend this Agreement as necessary and
appropriate to implement the requirements set forth in section 2 of this Agreement.
4. Notices. Any and all notices required,permitted or desired to be given hereunder by one
party to the other shall be in writing and shall be delivered to the other party personally or by United
States first class, certified or registered mail with postage prepaid, addressed to the other party at the
address set forth below:
To the GOVERNMENTAL FLTNDING ENTITY:
Rick Otto, City Manager
City of Orange
300 E. Chapman Ave.
Orange, CA 92866
rotto@cityoforange.org
With copies to:
Katrin Bandhauer, Assistant Finance Director
City of Orange
300 E. Chapman Ave.
Orange, CA 92866
sgalvan@cityoforange.org
To DHCS:
Sandra Dixon
California Department of Health Care Services
Capitated Rates Development Division
1501 Capitol Ave., Suite 71-4002
MS 4413
Sacramento, CA 95814
S andra.Dixon@dhcs.ca.gov
5. Other Provisions
5.1 This Agreement contains the entire Agreement between the parties with respect to
the Medi-Cal rate increases for HEALTH PLAN described in section 2.2 that are funded by the
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GOVERNMENTAL FLTNDING ENTITY and supersedes any previous or contemporaneous oral or
written proposals, statements, discussions,negotiations or other agreements between the
GOVERNMENTAL FUNDING ENTITY and DHCS. This Agreement is not,however, intended to be
the sole agreement between the parties on matters relating to the funding and administration of the Medi-
Cal program. One or more other agreements already exist between the parties regarding such other
matters, and other agreements may be entered into in the future. This Agreement shall not modify the
terms of any other agreement between the parties.
5.2 The nonenforcement or other waiver of any provision of this Agreement shall not
be construed as a continuing waiver or as a waiver of any other provision of this Agreement.
5.3 Section 2 of this Agreement shall survive the expiration or termination of this
Agreement.
5.4 Nothing in this Agreement is intended to confer any rights or remedies on any third
party, including, without limitation, any provider(s) or groups of providers, or any right to medical
services for any individual(s) or groups of individuals; accordingly,there shall be no third party
beneficiary of this Agreement.
5.5 Time is of the essence in this Agreement.
5.6 Each party hereby represents that the person(s) executing this Agreement on its
behalf is duly authorized to do so.
6. State Authoritv. Except as expressly provided herein, nothing in this Agreement shall be
construed to limit,restrict, or modify the DHCS' powers,authorities, and duties under federal and state
law and regulations.
7. Approval. This Agreement is of no force and effect until signed by the parties.
8. Term. This Agreement shall be effective as of July 1, 2015 and shall expire as of
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;,,,,a �n� �n�o December 31, 2020 unless terminated earlier by mutual agreement of the parties.
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have executed this Agreement, on the date of
the last signature below.
THE CITY OF OR.ANGE
By: Date:
MARK A. MURPHY, MAYOR
THE STATE OF CALIFORNIA, DEPARTMENT OF HEALTH CARE SERVICES:
By: Date:
Jennifer Lopez, "��Division Chief, Capitated Rates Development Division
ATTEST:
Pamela Coleman, City Clerk
APPROVED AS TO FORM:
Mary E. Binning, Sr. Assistant City Attorney
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INTERGOVERNMENTAL TRANSFER ASSESSMENT FEE
This Agreement is entered into between the CALIFORNIA DEPARTMENT OF HEALTH CARE
SERVICES ("State DHCS") and the City of Orange, a California municipal corporation operating
through its Fire Department, (GOVERNMENTAL FUNDING ENTITY) with respect to the matters set
forth below.
RECITALS
A. This Agreement is made pursuant to the authority of Welfare and Institutions Code, section
14301.4.
THEREFORE, the parties agree as follows:
AGREEMENT
1. Transfer of Public Funds
1.1 GOVERNMENTAL FiTNDING ENTITY shall make Intergovernmental
Transfer(s) ("IGTs")to State DHCS pursuant to section 14164 of the Welfare and Institutions Code and
paragraph 1.1 of the Intergovernmental Agreement(s)Regarding the Transfer of Public Funds contract
number 16-93672 Al, to be used as a portion of the non-federal share of actuarially sound Medi-Cal
managed care rate range capitation increases ("non-federal share IGT")to HEALTH PLAN (CalOptima)
for the periods of July 1, 2015 to June 30, 2016 and July 1, 2016 to June 30, 2017.
1.2 The parties acknowledge that State DHCS will obtain any necessary approvals
from the Centers for Medicare and Medicaid 5ervices ("CMS")pertaining to the acceptance of non-
federal share IGTs and the payment of non-federal share IGT related rate range capitation increases to
HEALTH PLAN.
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2. Intergovernxnental Transfer Assessment Fee
2.1 The State DHCS shall,upon acceptance of non-federal share IGTs pursuant to the
Intergovernmental Agreement(s) Regarding the Transfer of Public Funds, and as described in paragraph 1
of this Agreement, exercise its authority under section 14301.4 of the Welfare and Institutions Code to
assess a 20-percent assessment fee on the entire amount of the non-federal share IGTs to reimburse State .
DHCS for the administrative costs of operating the IGT program pursuant to this section and for the
support of the Medi-Cal program.
2.2 The funds subject to the 20-percent assessment fee shall be limited to non-federal
share IGTs made by the transferring entity, GOVERNMENTAL FUNDING ENTITY, pursuant to the
Intergovernmental Agreement(s) Regarding the Transfer of Public Funds, and as described in paragraph 1
of this Agreement.
2.3 The 20-percent fee will be assessed on the entire amount of the non-federal share
IGTs pursuant to the Intergovernmental Agreement(s)Regarding the Transfer of Public Funds, and as
described in paragraph 1 of this Agreement, and will be made in addition to, and transferred separately
from, the transfer of funds pursuant to the Intergovernmental Agreement(s) Regarding the Transfer of
Public Funds.
2.4 The 20-percent assessment fee pursuant to this Agreement is non-refundable and
shall be wired to State DHCS separately from, and simultaneous to, the non-federal share IGTs pursuant
to the Intergovernmental Agreement(s) Regarding the Transfer of Public Funds, and as described in
paragraph 1 of this Agreement. However, if any portion of the non-federal share IGTs is not expended for
the specified rate increases stated in paragraph 2.2 of the Intergovernmental Agreement(s)Regarding the
Transfer of Public Funds, DHCS shall return a proportionate amount of the 20-percent assessment fee to
the GOVERNMENTAL FUNDING ENTITY.
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3. Other Provisions
3.1 T'his Agreement contains the entire Agreement between the parties with respect to
the 20-percent assessment fee on non-federal share IGTs pursuant to the Intergovernmental Agreement(s)
Regarding the Transfer of Public Funds, and as described in paragraph 1, and supersedes any previous or
contemporaneous oral or written proposals, statements, discussions, negotiations or other agreements
between the GOVERNMENTAL FUNDING ENTITY and State DHCS. This Agreement is not,
however, intended to be the sole agreement between the parties on matters relating to the funding and
administration of the Medi-Cal program. One or more other agreements may exist between the parties
regarding such other matters, and other agreements may be entered into in the future. This Agreement
shall not modify the terms of any other agreement between the parties.
3.2 Time is of the essence in this Agreement.
3.3 Each party hereby represents that the person(s) executing this Agreement on its
behalf is duly authorized to do so.
4. State Authoritv. Except as expressly provided herein, nothing in this Agreement shall be
construed to limit,restrict, or modify State DHCS' powers, authorities, and duties under federal and state
law and regulations.
5. A� rp oval. This Agreement is of no force and effect until signed by the parties.
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have executed this Agreement, on the date of the last
signature below.
CITY OF ORANGE:
By: Date:
Mark A. Murphy, Mayor
THE STATE OF CALIFORNIA, DEPARTMENT OF HEALTH CARE SERVICES:
By: Date:
Jennifer Lopez, �g Division Chief, Capitated Rates Development Division
ATTEST:
Pamela Coleman, City Clerk
APPROVED AS TO FORM:
Mary E. Binning, Sr. Assistant City Attorney
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CITY COUNCIL MINUTES APRIL 9, 2019
3. CONSENT CALENDAR
All items on the Consent Calendar are considered routine and are enacted by one motion
approving the recommended action listed on the Agenda. Any member of the City Council,
staff or the public may request an item be removed from the Consent Calendar for
discussion or separate action. Unless otherwise specified in the request to remove an item
from the Consent Calendar, all items removed shall be considered immediately following
action on the remaining items on the Consent Calendar.
3.1 Confirmation of warrant registers dated March 7, 15,21, and 29,2019. (C2500.J.1.7)
ACTION: Approved.
3.2 City Council Minutes,Regular Meeting of March 12,2019. (C2500.D.4)
ACTION: Approved.
3.3 Waive reading in full of all ordinances on the Agenda.
ACTION: Approved.
3.4 Agreement with Watry Design, Inc. for architectural and engineering conceptual
design services for the Old Towne East Parking Structure Project.
(A2100.0; AGR-6753)
ACTION: 1) Authorized the transfer of$70,000 from 953.9810.56020.20247,NW& SW
Merged 2003 Tax Exempt Bonds — Economic Development Capital Projects to
953.5011.56020.20403, NW & SW Merged 2003 Tax Exempt Bonds — Old Towne East
Parking Structure; and 2)Approved the Agreement with Watry Design, Inc. in the amount
of$56,000 for architectural and engineering design services and authorized the Mayor and
City Clerk to execute on behalf of the City.
3.5 First Amendment to Consultant Services Agreement No. 6479 with Secoy Architect,
Inc., for professional services for Public Works and Community Development Front
Counter Remodel Project and the Old Towne East Parking Structure Project
conceptual plan development. (A2100.0; AGR-6479.1)
ACTION: Approved the First Amendment to Consultant Services Agreement No. 6479
with Secoy Architect, Inc. in the amount of$50,150 and authorized the Mayor and City
Clerk to execute on behalf of the City.
3.6 First Amendment to Intergovernmental Agreement Regarding Transfer of Public
Funds (Contract #16-93672) and Intergovernmental Assessment Fee (Contract #16-
93703) with the California Department of Health Care Services. (A2100.0; AGR-
6469.1)
ACTION: Approved First Amendment with the California Department of Health Care
Services and authorized the Mayor and City Clerk to execute the amendment on behalf of
the City.
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