LAFCO
Mendocino Coast Health Care District, 2014
Read the report at Local Agency Formation Commissions ↗
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
M E N D O C I N O CO A S T H E A LT H C A R E
DI S T R I C T M U N I C IPA L S E RV I C E
REV I E W
Adopted August 4, 2014
Prepared for the
Local Agency Formation Commission of Mendocino County
by
Policy Consulting Associates, LLC.
TABLE OF CONTENTS 0
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
TA B L E O F C O N T E N T S
1. AGENCY OVERVIEW .......................................................................................................................................... 2
FORMATION ............................................................................................................................................................... 2
BOUNDARY ................................................................................................................................................................ 2
SPHERE OF INFLUENCE .............................................................................................................................................. 3
ACCOUNTABILITY AND GOVERNANCE ....................................................................................................................... 6
MANAGEMENT AND STAFFING .................................................................................................................................. 8
GROWTH AND POPULATION PROJECTIONS ............................................................................................................... 10
DISADVANTAGED UNINCORPORATED COMMUNITIES .............................................................................................. 12
FINANCING .............................................................................................................................................................. 13
2. MUNICIPAL SERVICES ..................................................................................................................................... 18
HEALTHCARE SERVICES .......................................................................................................................................... 18
3. MSR DETERMINATIONS .................................................................................................................................. 29
TABLE OF CONTENTS 1
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
1 . AG ENCY OVERV IEW
The Mendocino Coast Healthcare District (MCHD) owns and operates the critical access
Mendocino Coast District Hospital, the North Coast Family Health Center (a primary care
rural health clinic), home healthcare services, and hospice services. This is the first
Municipal Service Review (MSR) for tFFhe
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MCHD was formed on January 17, 1967 by a vote of the District’s constituents for the
purpose of constructing a public hospital to serve the peopl.e1 of Mendocino County and
continues to operate as a local healthcare district pursuant to California Health & Safety
2
Code Section 3200, et seq. The hospital was completed in 1971
The principal act that governs the District is the Local Healthcare District Law. The
principal 3act empowers healthcare districts to provide medical services, emergency
medical, ambulance, and any other services relating to the protection of residents’ health
and lives . Districts must apply and obtain LAFCo approval to exercise services authorized
by the principal act but not already provided (i.e., latent powers) by the district at the end
of 2000. BBOOUUNNDDAARRYY
MCHD encompasses approximately 680 square miles and extends about 70 miles south
from the Humboldt/Mendocino County line. The District is bordered on the west by the
Pacific Ocean and includes the City of Fort Bragg and the communities of Westport, Cleone,
Caspar, Mendocino, Little River, Albion, Comptche, and Elk. (Refer to Figure 2) Both, the
hospital and the rural health clinic are located in the City of Fort Bragg.
Although the District primarily provides services to patients within its LAFCo approved
Extra-territorial Services
boundaries (known as the Primary Service Area or PSA), MCHD does provide services to
patients outside of its bounds. MCHD describes the area served outside of its legal bounds as its
Secondary Service Area (SSA), which includes the southern coastal communities of Gualala,
1
2 http://www.mcdh.org/bankruptcy-doc uments/
Health and Safety Code §32000-32492.
3
Health and Safety Code §32121(j).
AGENCY OVERVIEW 2
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
Manchester and Point Area.4 (Refer to Figure 3: Primary and Secondary Service Areas) In
addition, because of the significant tourist and visitor trade associated with the Fort Bragg-
Mendocino area, the hospital regularly treats patients who are non-residents.
The Mendocino Coast District Hospital, as part of the Hospital District (MCHD) is the only
hospital readily available to the residents of Fort Bragg and the Mendocino Coast. The next
nearest hospital is Howard Memorial Hospital in Willits, which is 35 miles away. Figure 1
provides information about other acute care providers in the area.
Figure 1: Acute Care Providers Near MCHD
Unserved Areas
There are no unserved areas within the Hospital District boundary.
SSPPHHEERREE OOFF IINNFFLLUUEENNCCEE
The District’s Sphere of Influence (SOI) is coterminous with its boundaries. (Refer to
Figure 2: MCHD Boundary and SOI)
In addition to service to residents within the District, as indicated above, MCHD also
serves an area along the South Coast (Manchester, Point Arena and Gualala). (Refer to
Figure 3) Residents in these communities do not contribute revenue to the District, nor can
they be charged additional fees for services. The same applies to non-residents (visitors
and tourists) who require District services while on the Mendocino Coast.
As an initial consideration to have the Secondary Service Area annex to the District,
LAFCo can consider including this area in the District SOI when the SOI is updated.
4
http://www.mcdh.org/about/district-service-area/
AGENCY OVERVIEW 3
Piercy MOODY RD HULLS VALLEY RD Leggett Covelo Laytonville Westport CAMP 1 TEN MILE RD SHERW Cleone OOD RD RAMSEY RIDGE RD Fort Bragg FORT BRAGG SHERWOODRD Brooktrails
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Mendocino Coast Mendocino Coast Hospital District Highways Source: This map was prepared by the Mendocino County Department of
Information Services GIS Program, July 2013.
Incorporated Cities Roads
Note: This map is not a survey product.
Hospital District °
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Figure 3:
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Secondary
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MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
AACCCCOOUUNNTTAABBIILLIITTYY AANNDD GGOOVVEERRNNAANNCCEE
Accountability of a governing body is signified by a combination of several indicators.
The indicators chosen here are limited to: 1) agency efforts to engage and educate
constituents through outreach activities, in addition to legally required activities such as
agenda posting and public meetings; 2) a defined complaint process designed to handle all
issues to resolution; and 3) transparency of the agency as indicated by cooperation with
the MSR process and information disclosure.
5
The principal act orders that the governing body of a healthcare district must have five
members. Directors are elected and must be a registered voter within the District.
Mendocino Coast Hospital District is governed by a five-member board elected to
alternating four-year terms. The current board member names, positions, and term
expiration dates are shown in Figure 4.
The Board of Directors has responsibility for the quality of patient care, district policies,
and strategic planning, as well as fiduciary responsibility for protecting and enhancing
district assets. Members of the Board serve in a voluntary capacity and medical insurance
compensation for their services.
Board meetings are held on the fourth Thursday of each month at 6:00 PM in the
Redwoods Room at the Mendocino Coast District Hospital. Board meeting agendas are
posted on the District website on Friday prior to the meeting, are published in the
newspaper, and also posted on the bulletin board and on the doors of the hospital. Board
meeting minutes are made available upon request, as well as distributed at the next board
meeting.
In addition to the Board of Directors, there are three standing committees of the Board,
each consisting of up to two Board members and as many as eight additional non-Board
members. The current standing committees include planning, finance, and audit. Standing
committees to the Board serve solely in an advisory capacity and recommend action items
to the Board for its approval. Special committees may be formed by appointment of the
Board’s President with full Board concurrence to investigate, study or review specific
matters. All committee meetings are open to the public.
5
Health and Safety Code §32100.
AGENCY OVERVIEW 6
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
Figure 4: Mendocino Coast Healthcare District Governing Body
Mendocino Coast Healthcare District
District Contact Information
Contact:
Address:
Wayne Allen, CFO and CEO
Telephone:
700 River Drive, Fort Bragg, CA 95437
Website:
707-961-1234
Email:
www.mcdh.org
Board of Directors
wallen@mcdh.net
Term Length of
Member Name
Position Expiration Manner of Selection Term
Patricia Jauregui-Darland President December 2014 Elected 4 years
Vice
John Kermen, D.O. December 2014 Elected 4 years
President
Tom Birdsell Secretary December 2016 Elected 4 years
Buz Graham, M.D. Member December 2014 Elected 4 years
Meetings
Sean Hogan Treasurer December 2016 Elected 4 years
Date:
Location:
Fourth Thursday of each month at 6:00 PM
Agenda Distribution: Redwoods Room, Mendocino Coast District Hospital.
Published in the newspaper, and posted on the District website and the
Minutes Distribution:
hospital bulletin board and building doors.
Made available upon request; distributed at the next board meeting.
In addition to the required agendas and minutes, MCHD encourages voter participation
by announcing Board of Director vacancies at public meetings, paying for advertisements in
the local newspaper, and speaking to civic groups, such as the Rotary Club and various
churches about the hospital. The District additionally informs the public about its activities
through the website where it posts information regarding its services, governance,
management, and operations.
In 2014, MCHD mailed a survey to approximately 12,000 registered voters seeking their
views on the role of the hospital, the care it provides, and its importance to the community.
Over 2,70 0 responses were received. Highlights of the survey are as follows:
94% of respondents indicated they wanted the hospital to continue providing
local health care;
The proximity of the hospital, the quality of care, nurses, physicians, and many
other aspects of the hospital were viewed favorably by a large portion of the
respondents and
AGENCY OVERVIEW 7
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
A majority of respondents (66%) were willing to support a parcel tax to allow
the hospital to continue in operation.
If a customer is dissatisfied with MCHD services, that person can submit complaints via
the Compliance Hotline established by the District. The hotline number is posted around
the hospital and on the website. MCHD reported that it received approximately 11 to 12
complaints in 2013, which were regarding dissatisfaction with the quality of care received.
The person in charge of handling the complaints is the quality and risk management
supervisor, who receives complaints and conducts the investigation. The quality and risk
management supervisor reports to the chief executive officer, who then conveys complaint
contents and the results of the investigation to the Board of Directors.
Government Code §53235 requires that if a district provides compensation or
reimbursement of expenses to its board members, the board members must receive two
hours of training in ethics at least once every two years and the district must establish a
written policy on reimbursements. The District’s Board members last received ethics
training in March 2014. MCHD has established a policy on expense reimbursements.
MCHD has adopted a Policy and Procedure Statement that provides a framework and
direction for district governance and administration. Included in the Statement are policies
on the code of ethics and conduct, Brown Act requirements and public requests for
information.
The Political Reform Act (Government Code §81000, et seq.) requires state and local
government agencies to adopt and promulgate conflict of interest codes. The Fair Political
Practices Commission has adopted a regulation (California Code of Regulations §18730),
which contains the terms of a standard conflict of interest code, which can be incorporated
by reference in an agency’s code. MCHD provided its conflict of interest code.
Government Code §87203 requires persons who hold office to disclose their
investments, interests in real property and incomes by filing appropriate forms with the
Fair Political Practices Commission each year. The District reported that the Directors
complied with this requirement in 2014.
MCHD demonstrated accountability in its disclosure of information and cooperation
with the LAFCo questionnaires and other requests. The District’s response to the interview
requests, written questionnaire and document requests, although slow to materialize, were
adequately provided. MMAANNAAGGEEMMEENNTT AANNDD SSTTAAFFFFIINNGG
While public sector management standards vary depending on the size and scope of the
organization, there are minimum standards. Well-managed organizations evaluate
employees annually, track employee and agency productivity, periodically review agency
performance, prepare a budget before the beginning of the fiscal year, conduct periodic
financial audits to safeguard the public trust, maintain relatively current financial records,
conduct advanced planning for future service needs, and plan and budget for capital needs.
AGENCY OVERVIEW 8
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
MCHD employs 245 full-time equivalent staff. There are 305 positions at MCHD of
which 205 are full-time and 100 are part-time. In addition to full- and part-time staff, the
District also relies on approximately 80 volunteers.
MCHD administration, which is responsible for delegating the day-to-day operations of
the District and its health facilities to the executive managers of the District, consists of the
chief executive officer (CEO), chief financial officer, chief of patient care services, chief of
human resources, and practice administrator. The chief executive officer, who reports to
the Board of Directors, oversees the remainder of the executive staff. Heads of the 20
departments (including Finance, Quality and Risk Management, Medical Records,
Cardio/Pulmonary, Housekeeping, Information Services, Volunteer Services,
Administration, Nursing Administration, Patient Registration, Human Resources,
Engineering, Rehabilitation Services, Medical/Surgical and Swing Infusion Clinic,
Ambulance Services, Surgical Services, Emergency Services, Laboratory, Security, North
Coast Family Health Center, Home Health/Hospice, Medical Staff Services, Dietary Services,
Diagnostic Imaging, Pharmacy, Business Office, Staff Development, and Chaplaincy) report
to the MCHD executive managers. Organization Charts for the Hospital Division and the
Home Health and Hospice Division are included in this MSR as Exhibits 1 and 2.
Medical staff officers include the chief of staff who reports to the CEO and oversees
other officers, including the assistant chief of staff, two MEC members-at-large, chief of
surgery, chief of medicine, and medical staff services.
In November 2001, a contract between the District and a local medical group was
approved to implement a hospitalist program at the Mendocino Coat District Hospital. The
hospitalist program is part of a well-established practice of using physician specialists for
the care and treatment of patients in the hospital. Each hospitalist works as a member of
the patient care team to ensure patients receive a continuity of care and maintain
communication with the primary care physician of each patient. The program was initially
managed and staffed by a local medical group. In 2005, the District took over management
of the program and the District implemented a full-time hospitalist program in 2006. The
program has grown to 13 board certified physicians in the specialties of internal medicine,
family practice, and endocrinology. The program provides 24-hour coverage to patients
admitted to the hospital. These include unassigned patients, patients admitted through the
emergency department, and also admitted patients who have primary care and sub-
specialty physicians in the area.
North Coast Family Health Center, which functions as one of the departments of the
hospital, is headed by the practice administrator who manages 25 to 30 employees who
support primary care physicians, surgeons, nurse practitioners, and other providers.
In addition, the District is supported by the Mendocino Coast Hospital Foundation,
which is a stand alone nonprofit organization located in Fort Bragg. It is governed by an
eight-member Board of Directors and three-member advisory board, and operated by five
employees, including executive director, event coordinator, administrative assistant, and
two others.
AGENCY OVERVIEW 9
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
MCHD performs employee evaluations annually. The department managers are
responsible for performing evaluations of their department employees. Department heads
are evaluated by the chief executive officer, who is evaluated by the Board.
Employee workload is generally tracked through timesheets. The District monitors its
productivity via electronic time clocks, reports from which get evaluated by department
managers. MCHD does not conduct formal evaluations of its own performance such as
benchmarking or annual reports. The District does not use any performance measures to
determine its service adequacy, but realizes its goal of serving the community and aims to
provide adequate services to its customers. In 2009, an independent survey of employee
satisfaction revealed that 93 percent of District employees were either very satisfied or
satisfied with their employment.
The District has made efforts to improve its operational efficiency over the last three
years. MCHD installed a more robust electronic productivity system. Additionally, the
District acquired new electronic badges that clock when employees leave and return more
efficiently.
The District reported that its primary objective was to remain viable, and is open to
affiliations with other strategic partners. MCHD’s mission is to make a positive difference
in the health of its rural community. Specific goals and objectives are recorded in the
annual budget. In addition, in 2010 the District adopted a 2011-2012 Strategic Plan.
MCHD is required to perform audits annually, and the District complies with this
requirement. The District prepares and adopts an annual budget. MCHD conducts
minimal, shortGG te
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This section discusses the factors affecting service demand, such as land uses, and
historical and anticipated population growth.
Land Use
6
Designated lan7d uses within the District consist primarily of timberland production,
grazing, and rural residential development. The District’s boundary area is approximately
680 square miles. The District is not a land use authority, and does not hold primary
r e s p o n s i b i l i t y f o r i m p l e m e n ting growth strategies. City of Fort Bragg is the land use
6
7 Mendocino County General Plan, 2009, pp. 3-2.
http://city.fortbragg.com/pdf/MSSPEIR_public_comment_lettersPart_I.pdf, pg. A-1.
AGENCY OVERVIEW 10
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
authority within the city boundaries, while Mendocino County is the land use authority for
the unincorporated areas within the District.
Existing Population
8
As of 2012, according to an estimate by district management, the population of MCHD
was approximately 28,000 residents. Its population density is 41 residents per square
mile, compared to the countywide population density of approximately 22 residents per
square mile.
Projected Growth and Development
MCHD reported that the population within its bounds had been decreasing over the last
five years. Similarly, in the next several years, the District is also expecting a decrease in
population; however, no formal population projections have been prepared by MCHD. The
District reported that it informally planned for population growth by looking at general
trends.
9
The California Department of Finance (DOF) projects a population growth average of
9.5 percent every 10 years for the entirety of Mendocino County. Based on these
projections, the District’s population will reach approximately 30,660 by the year 2020.
The 1C0ity of Fort Bragg is expecting that growth in its inland areas will continue to occur
at a slow but regular pace (less than 0.5 percent per year) as e1x1perienced in the last
decade. Along the coastal areas, similarly, the City is expecting growth at a slow but
regular pace (one to two percent per year) as during the last decade.
Although the District reported a potential decrease in population in the next few years,
the proposed redevelopment of the former Georgia-Pacific mill site could potentially
increase the population in MCHD’s bounds. The former mill site closed in 2002, but the
City of Fort Bragg has plans for its future redevelopment. The preliminary draft of the Mill
Site Specific Plan was completed in 2012 and provides the framework for a diversity of
land uses, including residential, visitor-serving, commercial retail, mixed-use, education
and research, industrial and other employment-generating uses, and open space areas,
including passive and active recreation areas as well as natural reserve areas. The
8
9 http://city.fortbragg.com/pdf/MSSPEIR_public_comment_lettersPart_I.pdf, p. 1.
1 0Mendocino County General Plan, 2009, pp. 3-5.
11 City of Fort Bragg Inland General Plan, Land Use element, 2012, p. 2-1.
City of Fort Bragg Coastal General Plan, Land Use element, 2008, p. 2-1.
AGENCY OVERVIEW 11
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
proposed red12evelopment offers an opportunity to reconnect the City to restored coastal
bluffs and to expand neighborhoods, downtown businesses, open space, and other uses
into the site. It is anticipated that an average annual amount of residential development
on the mill site over a 30-year period will be 18 new units per year or 40 new residents per
year, which equates to an annual increase of 1.3 percent pop1u3lation. The total new mill site
residential population over 30-year period for build-out is projected to be 1,233 persons or
17 percent of the entire population of the City of Fort Bragg.
Perhaps more significant for the District is the influx of visitors and tourists to the
Mendocino Coast area. These temporary population increases have the potential to put a
strain on the District’s ability to provide services. Although not a significant issue at the
present time, as the Visit Mendocino program is successful in attracting more visitors, the
need foDDr m II e SS d AA ic DD al VV se AA rv NN ic TT es AA w GG il EE l a DD ls oUU ex NN p II an NN d CC . OORRPPOORRAATTEEDD CCOOMMMMUUNNIITTIIEESS
LAFCO is required to evaluate disadvantaged unincorporated communities as part of
this service review, including the location and characteristics of any such communities. A
disadvantaged unincorporated community (DUC) is defined as any area with 12 or more
registered voters, or as determined by commission policy, where the median household
14
income is less than 80 percent of the statewide annual median.
Mendocino LAFCo has utilized census data to identify which communities (census
designated places) meet the disadvantaged communities median household income
15
definition. There are 17 disadvantaged unincorporated communities in the County. There
are three disadvantaged unincorporated communities within the District, including Albion,
Comptche, and Cleone. The City of Fort Bragg is also considered a disadvantaged
community, although incorporated.
The criteria for the provision of adequate services to a DUC is limited to water
supply, sewage disposal, and structural fire protection. Because the Hospital District
does not provide these services, the District is not responsible for assuring that
these services are adequately provided to the communities that meet the DUC
thresholds.
12
13 http://www.community-design.com/projects/neighborhood/ftbragg.php
Mill Site Specific Plan, PowerPoint Presentation, 2012,
1h4ttp://city.fortbragg.com/pdf/Powerpoint%202%20slides%20per%20page.pdf
15 Government Code §56033.5.
Based on census data, the median household income in the State of California in 2010 was $57,708, 80 percent of which
is $46,166.
AGENCY OVERVIEW 12
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
FFIINNAANNCCIINNGG
The financial ability of agencies to provide services is affected by available financing
sources and financing constraints. This section discusses the major financing constraints
faced by Mendocino Coast Healthcare District and identifies the revenue sources currently
available to the District.
As with most rural hospitals and districts in California, MCHD struggles financially. The
financial stability of MCHD has been impacted by the closures of the Georgia Pacific Mill,
reductions in the fishing and logging industry on the coast, and reductions in various
16
reimbursement rates. In 2006, the District’s financing situation improved after the
hospital was converted to critical access hospital (CAH) and started receiving Medicare
reimbursements. However, a combination of the recession, a need for sterilized surgical
equipment, and a slight loss of market share to larger hospital operators damaged the
District’s operating position. It is challenging for rural area hospitals to recruit physicians,
and as a consequence, lack of available physicians causes an outflow of patients from the
area to larger hospitals.
In summer of 2012, the District’s negotiations with its major creditors, including United
Food and Commercial Workers Union that represents 80 percent of the District’s
employees (the other 20% being management and confidential employees), as well as Cal-
Mortgage, which holds about $30 million in district bonds, failed. At that time it was
projected that M17CHD could lose as much as $2.5 million in 2012, a negative operating
margin of nearly six percent. Cash on hand could only sustain ongoing operations for less
than three days. On October 17, 2012, MCHD filed a voluntary petition under Chapter 9 of
the United States Bankruptcy Code. The approximate amount of pre-bankruptcy debt was
$1,991,000. The District is currently taking several steps to implement operational
improvements by the time it exits from bankruptcy. MCHD had to decrease its personnel
and combine some positions at the hospital.
The District has entered into physician guarantee agreements due to the need to recruit
physicians in certain specialties to the area. The agreements provide for a certain level of
income for a specified period of time. The physician is then expected to practice in the area
for another specified period of time.
Although MCHD reported that current financial levels were adequate to deliver
services, the District’s volatile revenue stream significantly decreased in FY 12-13—falling
short of expenditures by over $3.2 million. (Refer to Figure 5)
16
17 2006-2007 Mendocino County Grand Jury Report.
Payers and Providers, Mendocino Coast Filing Bankruptcy, 2012.
AGENCY OVERVIEW 13
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
Figure 5: MCHD Revenues and Expenditures, FYs 12-13 and 11-12
Revenues/Expenditures FY 12-13 % FY 11-12 %
Operating revenues
Net patient service revenue $42,937,651 98% $45,448,077 99%
Total operating revenues $43,738,892 100% $46,075,077 100%
Other operating revenue $801,241 2% $627,000 1%
Operating expenses
Salaries and wages $15,886,108 34% $16,537,522 35%
Employee benefits $9,629,811 21% $10,125,094 22%
Registry $949,115 2% $803,778 2%
Professional fees $6,771,742 14% $5,388,940 12%
Supplies $6,111,179 13% $6,583,633 14%
Purchased services $1,378,305 3% $1,673,413 4%
Repairs and maintenance $878,348 2% $558,413 1%
Utilities $650,951 1% $786,990 2%
Building and equipment rent $977,799 2% $988,924 2%
Insurance $705,463 2% $754,630 2%
Depreciation and amortization $1,836,350 4% $1,417,060 3%
Total operating expenses $46,952,638 100% $46,643,398 100%
Other operating expenses $1,177,467 3% $1,025,001 2%
Operating income (loss) ($3,213,746) ($568,321)
Nonoperating revenues
District tax revenues $1,136,279 75% $1,056,196 71%
Investment income $15,830 1% $49,845 3%
Total nonoperating revenues $1,513,386 100% $1,480,355 100%
Grants and contributions $361,277 24% $374,314 25%
Nonoperating expenses
Total nonoperating expenses $844,742 100% $746,498 100%
Interest expense $844,742 100% $746,498 100%
AGENCY OVERVIEW 14
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
Revenues
In FY 12-13, MCHD’s revenues totaled $48 million, which consisted of operating (97
percent) and non-operating (three percent) revenue sources. A majority of the operating
revenue came from charges for services. Non-operating revenue included property taxes,
investment income, and grants and contributions. Property tax revenue amounted to
$1,136,279 in FY 13, of which $702,184 is utilized for routine operations and $434,095 for
the retirement of bonds.
The District charges all its patients equally based on its established pricing structure for
the services rendered. The Master Schedule of Charges is evaluated on an ongoing basis to
ensure that only allowable charges are billed to comply with Medicare and MediCal
regulations. Gross patient revenues decreased by $6 million from FY 12 to FY 13, due
mainly to patient volume changes.
Patient service revenue consisted of acute care inpatient hospital services (30 percent),
long-term care daily hospital services-swing bed (three percent), outpatient services (62
percent), home health services (one percent), and rural health clinic (four percent), as
sFhigouwren 6in: FPiagtuiernet 6 S.e rvice Revenue
Patient Service Revenue FY 2013 %
Acute care inpatient hospital services $29,002,261 30%
Long-term care daily hospital services (swing bed) $3,017,268 3%
Acute care outpatient services $59,732,598 62%
Home health services $1,337,562 1%
$96,630,342 100%
Rural health clinic $3,540,653 4%
Gross patient service revenues
$42,937,651
Less deductions from revenue -53,692,691
Net patient service revenue
Payments on behalf of certain patients are made to the District by commercial
insurance carriers, private payors, the federal government under the Medicare program,
and by the State and federal government under the Medicaid program known as MediCal in
CFiagluifroer n7i:a P. aRyeovre Cnounet briyb putaiyoonrs i n FY 12-13 is depicted in Figure 7.
Payor FY 2013 %
Medicare $2,889,534 27%
MediCal $2,309,831 21%
Other third party payors $3,104,932 29%
Self pay and other $2,470,667 23%
Gross patient accounts receivable $10,774,964 100%
Less allowances for contractual adjustments and bad debt ($7,420,000)
Net patient accounts receivable $3,354,964
AGENCY OVERVIEW 15
MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
The District also receives contributions from the Mendocino Coast Hospital Foundation,
which raises funds for patient services and the replacement and purchase of equipment.
The foundation is the vehicle through which the community invests its money in the
Mendocino Coast Healthcare District. The foundation raises money to fund specific
projects for the healthcare district. In FY 12-13, the District received about $293,312 in
contributions from the foundation. The hospital provides office space to the foundation at
no charge, and the foundation’s directors and computer equipment are covered under the
hospital’s general liability, directors and officers, and property insurance.
MCHD is considering the implementation of a new revenue stream in the form of a
parcel tax. The District reported this tax may be considered within the next two years. In
2004, the District made efforts to have a special tax implemented; however, it did not pass.
Expenditures
Total expenditures in FY 12-13 were $48 million, of which over 98 percent were
operating expenditures and two percent were considered non-operating expenditures. The
most significant operating expenses were salaries and wages (34 percent) and employee
benefits (21 percent). Other significant expenses were professional fees and supplies.
(Refer to Figure 5)
Total expenditures exceeded total revenues in FY 12-13 by over $2.5 million. Operating
expenditures exceeded operating revenues by $3.2 million in the same fiscal year. To
compare, in FY 11-12, the District’s revenues exceeded expenditures by $165,536. While
expenditures remained fairly equivalent to the prior year’s costs, revenues significantly
decreased from FY 11-12 to FY 12-13, due to a decrease in service demand, as previously
discussed.
During FY 12-13, the District invested $3.5 million into the hospital facility. The two
primary additions included the purchase of the electronic health records computer
hardware and software, and the capitalization of the diagnostic imaging equipment.
As of June 30, 2013, the District had $2,806,938 recorded as construction-in-progress,
representing cost capitalized for various remodeling, major repair, or expansion projects
on the hospital’s premises. Future commitments related to these projects are
approximated to be just over $1 million.
Liabilities and Assets
The District’s long-term debt at the end of FY 12-13 is summarized in Figure 8.
AGENCY OVERVIEW 16
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MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
Figure 8 : MCHD Long-Term Debt
Debt Borrowings Balance FY 2013
Refunding revenue bonds, series 1996; due in annual principal
payments through 2020 at various amounts; interest due semi-
annually at rates between 5.75% to 5.875%; collateralized by
hospital assets. $1,765,000
General obligation bonds, series 2000 (interest); due in annual
principal payments through 2030 at various amounts; interest
due semi-annually at rates between 3.4% to 5.25%;
collateralized by district taxes $3,940,000
General obligation bonds, series 2000 (cap app); due in annual
principal payments starting in 2013 through 2024 at various
amounts; interest due semi-annually at rates between 3.4% to
5.25%; collateralized by district taxes. $811,539
Refunding revenue bonds, series 2009; due in annual principal
payments through 2029 at various amounts; interest due semi-
annually at rates between 2.62% to 4.75%; collateralized by
hospital assets. $4,445,000
Revenue bonds, series 2010, due in annual principal payments
through 2029 at various amounts; interest due semi-annually at
rates between 2.00% to 4.85%; collateralized by hospital assets. $2,495,000
Note payable to a lending institution related to the federal and
state meaningful use program; due in three separate principal
payments starting in November 2014 and bearing interest at
4%; unsecured. $2,500,000
Loan payable to Cal-Mortgage Loan Insurance Division (State of
California); bearing interest at 5%; guaranteed by hospital
revenues. $1,005,806
Sub-total $18,488,789
Other $1,526,444
TOTAL $16,363,957
Less current maturities ($2,124,832)
The District reported that it did not have a formal reserve policy. However, as a
management practice, MCHD budgets to have designated reserves. At the end of FY 12-13,
the District had a Discretionary Capital Improvement Reserve Fund of $4,519,612, and a
Restricted Bond Reserve Fund of $2,750,215
Financing Efficiencies
MCHD does not engage in any joint financing mechanisms.
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2 . M U NICIPA L SE RVIC ES
HHEEAALLTTHHCCAARREE SSEERRVVIICCEESS
Service Overview
The Mendocino Coast Healthcare District (MCHD) owns and operates an acute-care
critical access hospital located in Fort Bragg, and a primary-care rural health clinic. The
District also provides hospice services and home healthcare services. The Hospital is
licensed for 49 beds and is currently operating 25 beds.
Mendocino Coast District Hospital is a 25-bed acute care facility licensed by the State of
California Department of Health Services and accredited by The Joint Commission on
Accreditation of Healthcare Organizations. The hospital provides emergency, inpatient and
outpatient services, and healthcare education to prevent, manage and treat chronic and
acute conditions. Fifteen of the hospital’s acute care medical/surgical beds are licensed by
the California State Department of Public Health for utilization as swing beds for use as
either acute care beds or as skilled nursing beds, as the need demands.
In 2007, the District purchased a local physician group and converted the practice into a
provider-based rural health clinic. The purchase of the North Coast Family Health Center
permits the District to maintain a continuity of care for primary care services in the
community, and provides an additional revenue source for the District.
Core medical services along with other inpatient and outpatient specialty services are
provided by the District at the hospital and the clinic. Core services delivered by the
District include medical, pediatrics, emergency medicine, imaging (radiology), laboratory
and physical therapy. Specialty services include inpatient and outpatient surgery,
outpatient occupational and speech therapy, cardiac rehabilitation, obstetrics, and an
orthotics lab. The hospital provides primary care and certain secondary services, within
the capability of its medical staff (family practice, general surgery and orthopedic surgery).
Cases that require a medical specialty not represented by the hospital’s medical staff and
cases that require technology not available at the hospital are transferred to other health
facilities located in Santa Rosa and San Francisco.
Se rvices provided by MCHD include:
Emergency Department -- The emergency department is staffed 24-hours a day by a
team of medical professionals. All physicians are certified in Advanced Cardiac Life
Support (ACLS). Emergency department registered nurses are assisted by
paramedics and emergency medical technicians (EMT). Medical consultants are
available on-call in various specialties.
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ICU/CCU -- The four-bed combination Intensive and Critical Care Unit is designed to
provide specialized care for critically ill or injured patients. The unit is staffed by
registered nurses who have completed the specialized education and technical
training required. The unit is equipped with life-support equipment, as well as
current medical technology, which allows physicians and nurses to monitor all vital
signs. The unit also has telemetry services, which enable the hospital staff to
monitor cardiac functions for an additional four patients in the medical/surgical
unit.
Obstetrics (perinatal) -- The hospital's obstetrical unit was one of the first in-house,
family-centered maternity care programs in California. The obstetrical unit includes
labor, delivery and recovery services, plus a four-bed nursery with facilities for
immediate care, stabilization, and transport for critically ill newborns.
Medical/Surgical -- The medical/surgical unit provides care for both, medical
patients and patients hospitalized under any of the specialty surgical services
offered at the hospital, such as general surgery, orthopedic surgery and urologic
surgery. In addition, a designated pediatric area is available to provide medical and
surgical care to infants and children. The medical/surgical area is staffed by
registered nurses, licensed vocational nurses, and certified nursing assistants.
Swing Bed Program -- Fifteen of the hospital's acute care beds are licensed by the
State for utilization as skilled nursing beds. The Swing Bed Program allows patients
whose medical condition has stabilized to remain in the hospital if they still require
skilled nursing services that cannot be provided by the local skilled nursing facility.
Such services may include physical therapy, occupational therapy, speech therapy,
respiratory therapy, IV therapy, and/or other skilled nursing services.
Inpatient and Outpatient Surgical Services -- Surgery facilities at the hospital consist
of two operating rooms and a three-bed post anesthesia recovery unit. The hospital
offers a wide variety of surgical services and has the equipment and expertise to
perform gynecological and general surgery via the laparoscope, and advanced
orthopedic procedures via arthroscope. The hospital's ambulatory surgical service
allows patients to have surgery and return home on the same day.
Laboratory -- The laboratory department provides clinical laboratory, medicine,
pathology, and transfusion services. Over 95 percent of requested tests are
performed in-house, reducing delays in reporting results.
Outpatient Services -- In addition to outpatient surgical services, the hospital
provides treatment for patients receiving chemotherapy, blood transfusions,
diagnostic clinical studies, including endoscopic exam and biopsy, and other
specialized treatments or procedures.
SERVICE DESCRIPTION 19
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ICU/CCU -- The four-bed combination Intensive and Coronary Care Unit is designed
to provide specialized care for critically ill or injured patients. The unit is staffed by
registered nurses who have completed the specialized education and technical
training required. The unit is equipped with sophisticated life-support equipment,
as well as current medical technology, which allows physicians and nurses to
monitor all vital signs. The unit also has telemetry services, which enable the
hospital staff to monitor cardiac functions for an additional six patients in the
medical/surgical unit.
Obstetrics (perinatal) -- The hospital's obstetrical unit was one of the first in-house,
family-centered maternity care programs in California. The obstetrical unit includes
labor, delivery., recovery and post-partum services, plus a four-bed nursery with
facilities for immediate care, stabilization, and transport for critically ill newborns.
Medical/Surgical -- The medical/surgical unit provides care for both, medical
patients and patients hospitalized under any of the specialty surgical services
offered at the hospital, such as general surgery, orthopedic surgery and urologic
surgery. In addition, a designated pediatric area is available to provide medical and
surgical care to infants and children. The medical/surgical area is staffed by
registered nurses, clerical support, and certified nursing assistants.
Swing Bed Program -- Fifteen of the hospital's acute care beds are licensed by the
State for utilization as skilled nursing beds. The Swing Bed Program allows patients
whose medical condition has stabilized to remain in the hospital if they still require
skilled nursing services. Such services may include physical therapy, occupational
therapy, speech therapy, respiratory therapy, IV therapy, and/or other skilled
nursing services that cannot be provided by the local skilled nursing facility.
Inpatient and Outpatient Surgical Services -- Surgery facilities at the hospital consist
of two operating rooms and a three-bed post anesthesia recovery unit. The hospital
offers a wide variety of surgical services and has the equipment and expertise to
perform ophthalmology procedures, gynecological and general surgery via the
laparoscope, and advanced orthopedic procedures via arthroscope. The hospital's
ambulatory surgical service allows patients to have surgery and return home on the
same day.
Laboratory -- The laboratory department provides clinical laboratory, medicine,
pathology, and transfusion services. Over 95 percent of requested tests are
performed in-house, reducing delays in reporting results.
Outpatient Services -- In addition to outpatient surgical services, the hospital
provides treatment for patients receiving chemotherapy, blood transfusions,
diagnostic clinical studies, including endoscopic exam and biopsy, and other
specialized treatments or procedures.
Outpatient Services -- Outpatient services include the provision of chemotherapy, IV
admixtures and clinical support in the outpatient surgery department and the on-
site Hematology-Oncology-Infusion Clinic. Pharmacists provide on-site and on-call
SERVICE DESCRIPTION 20
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support to nurses and physicians by providing drug information, drug selection and
dosing calculation assistance, and patient monitoring through established protocols
designed to provide patients with optimal drug therapy.
Nutrition Department -- The District's nutrition department is dedicated to
providing patient meals. A registered dietician provides inpatient nutrition
counseling. Individual outpatient instruction is available with a physician's referral.
Group classes in weight control and general nutrition are held weekly periodically.
Home Health Care Program -- Under the direction of a referring physician, the home
care program provides skilled healthcare and social services to the patient and
family in familiar and comfortable surroundings. The home care team promotes
family integrity and independence by teaching families the skills they need to care
for the home patient. The home health service area extends from Westport to Sea
Ranch. All referrals and communications are received through the Fort Bragg Home
Healthcare office.
Hospice Program -- Hospice care responds to the special needs of the terminally ill
patient. Hospice is a coordinated program of palliative and supportive care for
dying persons and their families. Services are provided by an interdisciplinary team
of professionals and volunteers.
Ambulance Service -- The hospital is designated as a "base hospital." It monitors
local and countywide emergency radio channels and can dispatch two advanced life
support ambulances to any location in the District.
Outpatient Clinic (North Coast Family Health Center) -- The North Coast Family
Health Center offers primary care and specialty care services to the community,
including family practice, internal medicine, women's health, general medicine,
nephrology, endocrinology, ophthalmology, orthopedics, osteopathy, podiatry,
pediatrics, diabetes education, bone densitometry, pacemaker checks, and spinal
adjustments.
MCHD does not provide contract services to other agencies; however, it does receive
contracted services in the form of biomedical equipment maintenance.
The District noted that there were occasions when other providers delivered similar
services within or adjacent to MCHD bounds, including private physicians. One of the
providers is Venice Group, which provides outpatient lab services. In addition, there is also
Mendocino Coast Clinic, which is a federally qualified, not-for-profit, health center.
Demand for Services and Capacity
MCHD reported that demand for services had decreased slightly over the last three
years (approximately 2% per year). In addition to the population decline within the
SERVICE DESCRIPTION 21
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District’s bounds, MCHD also attributes the decreased demand for services to outflow of
patients to larger hospitals, and to the fact that customers are healthier because of the
focus on preventative medicine.
In FY 12-13, there were 3,796 total acute patient days, as compared to 3,913 for the
prior year. This three percent decrease was a result of less patient volume during the
winter flu season. Swing bed care days were 1,411 for FY 12-13 as compared to 1,907 for
FY 11-12. This 26 percent decrease was due to fewer patients medically qualifying for sub-
acute levels of care.
Emergency department visits increased to 9,525 as of June 30, 2013, which is up from
9,266 as of June 30, 2012. Visits increased by 259 or 2.8 percent during that time period.
Average acute care length of stay increased to 3.65 days in FY 12-13 from 3.47 in FY 11-
12. Outpatient referral visits decreased to 52,139 in FY 12-13 from 53,714 in the prior
year, due to decreases in patient activity in most of the outpatient departments.
Total inpatient and outpatient surgeries decreased to 1,822 in FY 12-13 from 1,971 in
the prior year, which is a total decrease of 149, due to the fewer number of outpatient cases
that were seen in that year.
Home health visits increased to 5,275 in FY 12-13 from 4,794 in FY 11-12. Visits
increased by 481, due to more order authorizations from referring physicians.
Rural health clinic visits decreased to 26,649 in FY 12-13 from 29,303 in the prior year.
Visits decreased by 2,654 due to a reduction in available staff for family nurse practitioners
and physicians at the North Coast Family Health Center.
The District reportedly forecasts service needs by identifying and observing trends.
MCHD expects a slight increase in demand within its bounds over the next 10 years.
However, the redevelopment of the mill site is expected to have a significant effect on
hospital operations. The increase in industrial activity and population will impact the
emergency room, which is currently beyond capacity on major weekends and holidays.
The District operates one ambulance in Fort Bragg and one in Mendocino; the demand for
which will potentially be increased by the emergency calls associated with the additional
population and industrial activity forecast for the mill site. The rural health clinic is also
expected to have a substantially increased number of visits and require additional facilities
to handle the increase in population. Currently, the North Coast Family Health Center has
about 30,000 medical visits per year. With an increase in this number, it will require an
increase in the number of providers and facilities to deliver the needed services.
With the increase in population, there is anticipated to be an increase in inpatient
census at the hospital, which will impact the other ancillary services associated with
inpatient care, such as the laboratory operation, food nutritional services, and diagnostic
services. The only department that would reportedly be able to handle the increase in
demand is the new diagnostic imaging center that opened in 2011.
SERVICE DESCRIPTION 22
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Infrastructure and Facilities
The District owns and operates a hospital, which is a 25-bed acute care facility licensed
by the State of California Department of Public Health. The hospital, located at 700 River
Drive, in the City of Fort Bragg, was opened in June of 1971 and financed by the issuance of
$2,250,000 in general obligation bonds authorized at an election held in the District on
December 5, 1967; and the receipt of a $637,934 Federal Hill-Burton grant in 1969. A
9,000 square foot addition to the hospital was completed in 1994, and funded in part by
revenue bonds issued in 1990 by the District. This addition contained a new emergency
room and laboratory department. In 1996, the District issued revenue bonds to refund the
1990 revenue bonds, and to finance radiology and surgery department improvements. In
2001, the District issued current interest general obligation bonds in the aggregate
principal amount of $4,615,000, and capital appreciation general obligation bonds in the
aggregate principal amount of $884,627.75 (collectively called the Series 2001 General
Obligation Bonds). Proceeds of the Series 2001 General Obligation Bonds were used to
finance the construction and equipping of the patient services building, which included the
rehabilitation department, patient registration, the hematology/oncology clinic,
administrative offices for finance, and a conference room.
The hospital was licensed for 52 acute beds until March 31, 2004, at which time the
State Department of Public Health granted the hospital a change in its licensed beds to 49
beds. Although the hospital continues to be licensed for 49 beds, in October of 2006 the
hospital be18came a 25-bed Critical Access Hospital (CAH), which is a hospital that is certified
to receive cost-based reimbursement from Medicare. The 49 beds consist of 38 general
acute care beds, four intensive care beds, and seven perinatal (obstetrics) beds. In 2006,
when the hospital became a CAH, 20 general acute care beds and four perinatal beds were
suspended by the District. To be eligible for critical access status, a hospital must be
located in a rural area, be at least 35 miles from any other hospital, and have no more than
25 beds.
The North Coast Family Health Center, a rural health clinic fully utilizes 12,300 square
foot of the Mendocino Coast Medical Plaza located on District property. The Mendocino
Coast Medical Plaza is owned by a California limited liability company, formed for the
purpose of constructing and managing the Mendocino Coast Medical Plaza building.
Construction of the plaza building began in 2004 and was completed in 2005.
18
Fifteen of the hospital’s general acute care beds are approved as swing beds for skilled nursing services.
SERVICE DESCRIPTION 23
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Infrastructure Needs or Deficiencies
19
By 2030, MCHD will be required to replace the main hospital building because it will no
longer meet the State of California earthquake requirements. The District has already
commenced facility planning for this eventual need.
In addition, the District has planned a number of other minor capital improvement
projects, including replacing the nurse call system, adding a new telephone switchboard,
and replacing flooring materials in multiple departments of the hospital.
In its 2011-2012 Strategic Plan, the District indicated that it was one of its strategic
goals to continue to develop a state of the art physical plant and campus, which would be
attractive, highly functional and support the hospital’s efforts to provide those it serves
with the “ideal” patient experience. The project entails updating, modernizing and
refurbishing patient rooms, common areas and infrastructure components; as well as
ensuring that the hospital meets all requirements of the SB 1953 seismic safety law.
Shared Facilities and Regional Collaboration
MCHD is a participating member of a Northern California JPA within which healthcare
districts in the area share ideas, work plans and management best practices. The District
also holds memberships in the California Hospital Association, the Association of California
Healthcare Districts, the American Hospital Association, the Hospital Council of Northern
and Central California, and other professional healthcare organizations.
In addition, MCHD has established affiliation programs for clinical site training with
schools and programs, including the nursing program at California State University in
Chico, the nursing and paramedic programs at Mendocino College in Ukiah, the radiology
program at Santa Rosa Junior College, and the phlebotomy and emergency medical
technician program at the Mendocino County Office of Education.
The hospital provides office space to the Mendocino Coast Hospital Foundation, and the
foundation’s directors and computer equipment are covered under the hospital’s general
liability and property insurance policies.
Service Adequacy
There are several benchmarks that may define the level of healthcare service provided
b y a n a g e n c y , s u c h a s c o m p l aints, patient outcomes, occupancy rates, staffing levels, costs,
19
http://city.fortbragg.com/pdf/MSSPEIR_public_comment_lettersPart_I.pdf, pg. 3.
SERVICE DESCRIPTION 24
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emergency room closures and workload, operating room use, and the extent to which
residents go to other hospitals for service. Complaints, costs and staffing levels were
discussed in the previous sections of this chapter. Indicators of service adequacy discussed
here include: 1) prevention quality indicators; 2) community-acquired pneumonia
mortality rates; 3) inpatient mortality indicators; 4) hospital occupancy rate; 5) EMS
ambulance diversion rates; 6) operating room use; 7) the extent to which residents go to
other hospitals for service; and 8) accreditation information. These indicators for
measuring service adequacy are established by the Center for Medicare and Medicaid
Studies (CMS) and Office of Statewide Health Planning and Development (OSHPD).
20
Although this data is not available specifically for MCHD, or even for Mendocino County,
it is important to discuss Prevention Quality Indicators (PQIs). Due to small population
sizes, twenty-four counties in California were reported using seven groupings of two to five
counties each. Groups were used because the count of selected hospitalizations in some
counties was too small for meaningful analysis. Mendocino County was grouped together
with Del Norte and Humboldt into the North Coast Group. For some of the indicators,
including diabetes long-term complications, pediatric asthma, pediatric gastroenteritis,
hypertension, congestive heart failure, urinary tract infection, and lower extremity
amputation among patients with diabetes, the North Coast Group had some of the
California’s best (lowest) rates, suggesting that residents there have the best access to
outpatient care for these diseases. When a person receives early and proper treatment for
specific medical conditions, disease complications may be reduced or eliminated, disease
progression may be slowed, and hospitalization may be prevented. For all other PQIs that
include diabetes short-term complications, per2f1orated appendix, chronic obstructive
pulmonary disease, dehydration, bacterial pneumonia, angina without procedure, and adult
asthma, the group displayed average performance.
‐
Community acquired pneumonia is one of the leading causes of death both nationwide
and in California. For this reason, OSHPD chose it to be one of the conditions studied in the
California Hospital Outcomes Program (CHOP), an initiative mandated by the State of
California. The latest reports available are for 2002-2004. During that period, MCHD had
similar community-acquired pneumonia mortality rates to the State average.
Inpatient Mortality Indicators (IMIs) for MCHD are available for acute myocardial
i n f a r c t i o n , c o n g e s t i v e h e a r t f ailure, acute stroke, gastro-intestinal hemorrhage, hip fracture,
20
The Prevention Quality Indicators (PQIs) are a set of measures that can be used with hospital inpatient discharge data
to identify quality of care for "ambulatory care sensitive conditions" in adult populations. These are conditions for which
good outpatient care can potentially prevent the need for hospitalization or for which early intervention can prevent
complications or more severe disease. The Prevention Quality Indicators represent hospital admission rates for 4
2a1mbulatory care sensitive conditions.
OSHPD, Preventable Hospitalizations, PQI maps, 1999-2008.
SERVICE DESCRIPTION 25
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22
and pneumonia for 2011. Evidence suggests that high mortality may be associated with
deficiencies in the quality of hospital care provided. The IMIs are part of a suite of
measures called Inpatient Quality Indicators (IQIs), developed by the Federal Agency for
Healthcare Research and Quality (AHRQ), that provide a perspective on hospital quality of
care. IMIs are calculated using patient data reported to OSHPD by all California-licensed
hospitals. All IMIs include risk-adjustment, a process that takes into account patients'
pre-existing health problems to "level the playing field" and allow fair comparisons among
hospitals. The District’s mortality rates in 2011 for acute myocardial infarction were 12.8
percent compared to 6.5 percent statewide; heart failures were zero percent compared to
three percent statewide; 12.9 percent for acute stroke compared to 9.4 percent statewide;
zero percent for gastro-intestinal hemorrhage compared to 2.2 percent statewide; zero
percent for hip fracture compared to 2.3 percent statewide; and 4.9 percent for pneumonia
compared to 4.1 percent statewide. MCHD is considered not significantly different from
the statewide average for all Inpatient Mortality Indicators.
23
The District’s hospital had an occupancy rate of 57.8 percent in FY 12-13, compared to a
statewide average of 59.5 percent. This occupancy rates suggest that service adequacy is
satisfactory, and there are enough hospital beds in the area to serve patients as needed.
Emergency room closure data was not available for recent years. The last year when
this information was reported was 2007. The MCHD hospital was closed for a total of zero
hours during that year. For 2012, in lieu of emergency closure rates, EMS ambulance
diversion rates were used as an indicator for emergency room use. In 2012, ambulances
were not diverted to other hospitals from the MCHD hospital.
24
The operating room at the MCHD hospital was used for surgeries approximately 22
percent of the available time in 2012. The operating room was used for outpatient
surgery 2.5 times more than for inpatient surgery. The operating room appears to have
enough capacity to accommodate existing demand and possible future growth.
The adequacy of hospital facilities and services in meeting the needs of District
residents can be gauged by the extent to which residents travel outside their region to
receive hospital services. The rates were calculated based on patient discharge data from
22
OSHPD did not report mortality rates for other conditions (for ecophageal resection, pan creatic resection, abdominal
aortic aneurism repair, craniotomy, percutaneous transluminal coronary angioplasty, and carotid endaterectomy) for the
2D3 istrict becAanunsuea fle Fwinear ntchiaanl Dthisrceleo spurroec Redepuorerts were performed or conditions were treated.
OSHPD, , June 30, 2013. Latest figure found for State of California was 2010,
h24t tp://www.oshpd.ca.gov/hid/Products/Hospitals/AnnFinanData/HospFinanTrends/
Operating room use rates are calculated as the number of surgery-minutes divided by the annual capacity of the
operating rooms (number of minutes in a year is based on 24-hour use).
SERVICE DESCRIPTION 26
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MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
25
OSHPD. Residential location was approximated by zip code. About 82 percent of residents
who live within MCHD boundaries patronize the district hospital.
There are several major healthcare-related accreditation organizations in the United
States: Healthcare Facilities Accreditation Program (HFAP); Joint Commission (JC),
Community Health Accreditation Program (CHAP); Accreditation Commission for Health
Care (ACHC); The Compliance Team – Exemplary provider programs; Healthcare Quality
Association on Accreditation (HQAA); and DNV Healthcare, Inc. (DNVHC). For the State of
California, the primary accreditation organization is the Joint Commission. The Joint
Commission is a not-for-profit organization that accredits and certifies more than 19,000
health organizations and programs in the country. Accreditation can be earned by an
entire healthcare organization, for example, hospitals, nursing homes, office-based surgery
practices, home care providers, and laboratories. In California, the Joint Commission is part
of the joint survey process with State authorities. Hospitals are not required to be
accredited in order to operate. Accreditation generally recognizes outstanding
performance by a healthcare provider.
Mendocino Coast District Hospital is fully licensed by the Department of Health Services
and accredited by the Joint Commission on Accreditation of Healthcare Organizations.
The District’s Profile for Healthcare Services is presented in Figure 9.
25
Discharge data includes discharges from ambulatory surgery center, emergency department, inpatient discharges, and
inpatient discharges that originated in the emergency department.
SERVICE DESCRIPTION 27
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Figu re 9: Mendocino Coastal Healthcare District Service Profile
Healthcare Services
Facilities
Hospitals/Clinics Location Built/Acquired Owner
700 River Drive, Fort
Mendocino Coast District Hospital Bragg, CA 95437 1971 MCHD
721A River Drive, Fort
Service Challenges
North Coast Family Health Center Bragg, CA 95437 2007 MCHD
The District's main challenge is its financial struggles, caused by the recent economic recession, reduction in
the fishing and logging industry, reduction in various reimbursement rates, outflow of patients to larger
Facility Needs/Deficiencies
hospitals, lack of available physicians, and healthier population.
The main infrastructure need is the long-term but significant need to replace the main hospital building by
Facility Sharing
2030 because it would no longer meet the earthquake requirements.
Current Practices:
T he hospital provides office space to the Mendocino Coast Hospital Foundation. The
District is a member in multiple professional organizations and a JPA, in addition to participating in various
Future Opportunities:
affiliation programs.
Service Adequacy
No future opportunities for facility sharing were identified.
Occupancy rate (FY 12-13)
Emergency room closure rate (2012)
57.8 percent compared to 59.5 percent statewide in 2010
Operating room use (2012)
0 percent
Patient patronage (2012)
22 percent
Accreditations
82 percent
Joint Commission on Accreditation
SERVICE DESCRIPTION 28
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3 . M SR D ET ERM INAT IONS
Grow th and Population Projections
As of 2012, the population within Mendocino Coast Healthcare District (MCHD) was
approximately 28,000.
MCHD reported that the population within its bounds had been decreasing over the
last five years. Similarly, in the next several years, the District is also expecting a
decrease in population.
Although the District reported a potential decrease in population in the next few
years, the proposed redevelopment of the former Georgia-Pacific mill site could
potentially increase the population in MCHD bounds. The total additional residential
population over the 30-year period until build-out of the project is projected to be
1,233 persons.
Location and Characteristics of Any Disadvantaged
Unincorporated Communities Within or Contiguous to the
Sphe re of Influence
There are three disadvantaged unincorporated communities in the District: Albion,
Comptche and Cleone. The City of Fort Bragg is also considered a disadvantaged
community, although incorporated.
Because MCHD does not provide water, sewer or structural fire protection
services, the District is not responsible for assuring that these services are
adequately provided to the disadvantaged urban communities within the District
boundaries.
Present and Planned Capacity of Public Facilities and
Adequacy of Public Services, Including Infrastructure Needs
and Deficiencies
Redevelopment of the old Georgia-Pacific mill site would impact service provision in
the District. MCHD would require additional capacity and resources to
accommodate the population increase.
By 2030, MCHD will be required to replace the main hospital building, as it will no
longer meet the State of California earthquake requirements.
MSR DETERMINATIONS 29
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MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
Based on the service adequacy indicators, including prevention quality indicators,
community acquired pneumonia mortality rates, inpatient mortality indicators,
emergency room closure rate, and patient patronage, the District provides adequate
level of services.
There appear to be enough hospital beds at the hospital to accommodate current
and additional demand. Similarly, there appears to be enough operating room
capacity to serve current needs and potential growth. After the development of the
mill site the capacity will need to be reassessed.
The accreditation by the Joint Commission attests to the high quality of services
provided by the District.
Fina ncial Ability of Agencies to Provide Services
MCHD undergoes continuous financial difficulties caused by economic downturn,
closure of fisheries and logging industry in the area, reductions in various
reimbursements, lack of available physicians, and outflow of patients to larger
hospitals that provide wider array of services.
In 2012, the District declared bankruptcy, and is currently in the process of making
improvements to its operational efficiency as well as cutting costs to improve its
financial situation.
MCHD receives financial assistance from the Mendocino Cost Hospital Foundation
that raises funds for patient services and the replacement and purchase of
equipment.
The District currently has over $16 million in long-term debt.
Although the District does not keep any formal financial reserves, it attempts to save
as much as possible at the end of each fiscal year.
Statu s and Opportunities for Shared Facilities
MCHD is a participating member of the Northern California JPA, the California
Hospital Association, the Association of California Healthcare District, the American
Hospital Association, the Hospital Council of Northern and Central California, and
other professional healthcare organizations.
MCHD has established affiliation programs for clinical site training with schools and
various programs.
The hospital provides office space to the Mendocino Coast Hospital Foundation, and
the foundation’s directors and computer equipment are covered under the
hospital’s general liability and property insurance policies.
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MENDOCINO LAFCO
MENDOCINO COAST HEALTHCARE DISTRICT MUNICIPAL SERVICE REVIEW
Accountability for Community Services, Including
Gove rnmental Structure and Operational Efficiencies
MCHD is governed by a five-member Board of Directors. The Board updates
constituents, posts agendas and makes information regarding its meetings available
to the public.
All of the District’s current Board members were elected, which demonstrates
interest in the affairs of the agency within the community.
In addition to the legally required public outreach, the District keeps its constituent
informed by participating in public events, posting information on its website and
soliciting feedback.
MCHD demonstrated accountability in its disclosure of information and cooperation
with the LAFCo questionnaires and other requests. The District’s response to the
interview requests, written questionnaire and document request, although slow to
materialize, were adequately provided.
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