Less than two weeks after one Cambria agency voted to place a parcel tax on the June ballot, board members of another agency discussed the possibility of doing the same thing in November.
Cambria Community Healthcare District trustees said Wednesday it was premature to take any action on such a tax, which members of the district’s finance committee presented as an option for dealing with the current revenue crunch.
On Feb. 8, the Cambria Community Services District approved a ballot measure that would call for a $62.15 annual assessment on every parcel within its boundaries. No dollar figure was suggested for any health care levy; CCHD trustees didn’t have all the numbers they needed to consider the idea. A finbancial audit is pending.
In the meantime, Vice President Barbara Bronson Gray said, the district should first look at ways to cut expenses: “While we’re talking about the possibility of a tax increase, we still have made no cuts,” she said.
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Audience member Iggy Fedoroff said the district could close its deficit by returning Operations Director Jason Melendy to full-time paramedic duties. District Administrator Bob Sayers said that move, made on a temporary basis, had saved $50,000 over a little more than two months.
But Sayers and other members of the finance committee — trustees Mary Anne Meyer and Bob Putney — all spoke favorably of a tax.
“CCHD does not have any other way to increase its revenues,” Meyer said. “The only way to increase revenues is to put another tax assessment initiative on the ballot.”
Putney said increases in the current tax are tied to the Consumer Price Index, which has failed to keep pace with rising costs in the industry. For instance, he said, costs for some medical supplies have risen 350 percent since 2006, and the cost of tires for district ambulances has gone up 60 percent.
While we’re talking about the possibility of a tax increase, we still have made no cuts.
Barbara Bronson Gray, CCHD trustee
“Most of the cuts that are being proposed are short-term solutions that won’t get us out of harm’s way,” he said. “I believe we’re going to have to go back to the voters to bridge that gap … between 2006 and now.”
Any large-scale cuts the district might consider “would either gut the district or would not be able to keep up with inflation,” he added.
Rising costs aren’t the only problem. An even bigger issue could be declining revenues tied to smaller reimbursements for ambulance calls.
Sayers said the district has seen fewer commercial calls in recent months — calls backed by private insurance, which he said typically pay the district $2,500 to $2,800. Instead, an increasing number of calls have been from Medicare and Medi-Cal, which he said pay just $560 and slightly more than $100, respectively.
In his monthly financial report, Sayers said the district had lost 48 commercial patients between 2016 and 2017, three of whom shifted to Medicare/Medi-Cal while 27 moved to Kaiser and 18 were lost completely.
The trend, he said, has continued in January and February.
The only way to increase revenues is to put another tax assessment initiative on the ballot.
Mary Anne Meyer, CCHD vice president
“It’s unusual to see that kind of change in the mix of patients in a health care organization,” Sayers said, suggesting that the shift might be tied, in part, to the Highway 1 closure as well as the aging population.
Bronson Gray said the decline in commercial accounts could be a temporary phenomenon. “We need a longer trend analysis to see if our payer mix really is a problem,” she said. “Our trend line is only six months long, so I don’t think we should jump to conclusions.”
But Vince Pierucci, Emergency Medical Services district manager for San Luis Obispo County, said he has seen the same trend over the past several years countywide and throughout the state.
“It’s a significant issue, especially in the EMS industry,” he said, saying he began to see a shift with the adoption of the Affordable Care Act. “When that was fully implemented is when you really started to see a significant change. The government is going to pay $125 flat (for an ambulance transport); your costs are $2,000, and they really don’t care.”
The district received another piece of financial bad news when Sayers told trustees it would cost $14,174 more than expected to repair the roof on its Main Street facility.
That brings the total cost of the repairs by CenCal Roofing to $46,264.
Sayers said much of the additional cost was “for replacing all the beams and fascia because they have a tremendous amount of dry rot up there, and my understanding of dry rot is that, once it gets started, it just goes right through.”
Putney said the plan was to replace the flat roof, where water had pooled to cause the damage during the storms of early 2017, with a sloped roof to allow for drainage. He also said the skylights, which he called “an eternal, ongoing problem,” would be removed.
Trustees approved the additional payment to CenCal on a 5-0 vote. Work on the roof was scheduled to begin Friday, Feb. 23.