REPORT/RECOMMENDATION TO THE BOARD OF SUPERVISORS
OF SAN BERNARDINO COUNTY
AND RECORD OF ACTION
January 23, 2024
FROM
JOSHUA DUGAS, Director, Department of Public Health
SUBJECT
Title
Contract with Fonemed LLC for After-Hours Care Services
End
RECOMMENDATION(S)
Recommendation
Approve contract with Fonemed LLC, including non-standard terms, to provide after-hours care services, in an amount not to exceed $450,000, for the period of January 23, 2024 through January 22, 2027.
(Presenter: Joshua Dugas, Director, 387-9146)
Body
COUNTY AND CHIEF EXECUTIVE OFFICER GOALS & OBJECTIVES
Provide for the Safety, Health and Social Service Needs of County Residents.
FINANCIAL IMPACT
Approval of this item does not impact Discretionary General Funding (Net County Cost). The total amount of this contract will not exceed $450,000 and will be fully funded with federal funds from the Federal Public Health Service Act. Adequate appropriation has been included in the Department of Public Health’s (DPH) 2023-24 budget and will be included in future recommended budgets.
BACKGROUND INFORMATION
DPH currently operates four Federally Qualified Health Centers (FQHC) located throughout San Bernardino County. Section 330 of the Federal Public Health Service Act requires that FQHC serve an underserved area or population, provide comprehensive primary care services that include mental health and dental services, provide coverage for medical emergencies during and after business hours, ensure continuity of care and hospital admitting privileges, and have an ongoing quality assurance program. In 2022, the FQHCs served more than 10,100 unique patients.
As a condition of the funding, FQHCs desire and are required to provide timely medical advice by telephone. Approval of this item ensures that DPH will have a qualified contractor to provide call services with access to a physician as needed during after-hours when the FQHC are closed.
Contractor performance will be monitored by County staff to ensure compliance with the administrative, program and fiscal terms and conditions of the contract. DPH Finance staff will review invoices and back-up documentation submitted by the contractor to ensure charges are for eligible services prior to payment.
The contract with Fonemed, LLC (Fonemed) is its standard commercial agreement with terms that differ from the standard County terms as follows:
1. The contract requires the County to defend, indemnify, and hold Fonemed harmless for any claims arising out of the contract that is caused by the County.
• The County standard contract does not include any indemnification or defense by the County of a contractor.
• Potential Impact: By agreeing to indemnify Fonemed, the County could be contractually waiving the protection of sovereign immunity. Claims that may otherwise be barred against the County, time limited, or expense limited could be brought against Fonemed without such limitations and the County would be responsible to defend and reimburse Fonemed for costs, expenses, and damages, which could exceed the total contract amount. County Counsel cannot advise on, whether and to what extent, Missouri law may limit or expand this contract term.
2. The County is responsible for payment of legal or collection fees associated with Fonemed recovering past-due balances beyond Net 30 days.
• County standard payment term is Net 60 days without penalty for late payment. The County standard contract also requires each party to pay its own costs and attorney’s fees, regardless of who is the prevailing party.
• Potential Impact: County standard processing time is 60 days or more. Failing to pay within 30 days of invoice will result in a material breach of the contract, which would allow Fonemed to terminate the contract and institute collection actions. The County would be responsible for the collection costs and attorney fees incurred by Fonemed in recovering past-due balance from the County.
3. The contract is silent on governing law.
• The County standard contract requires California governing law.
• Potential Impact: The contract is silent on governing law. This results in uncertainty over which state’s laws will govern the interpretation of the contract, and leads to ambiguity in interpretation of the contract terms. Fonemed is a limited liability company based in Missouri. The contract could be interpreted under any state law depending on where the claim is brought, including Missouri or California. Any questions, issues or claims arising under this contract could require the County to hire outside counsel competent to advise on the applicable state law, which may result in fees that exceed the total contract amount.
4. Venue is in the State of Missouri.
• The County standard contract requires venue to be in the San Bernardino County Superior Court, San Bernardino District.
• Potential Impact: In the event of a dispute, claims must be brought in the state or federal courts in the State of Missouri. Having venue in Missouri will require the County to hire outside counsel licensed to practice law in Missouri, which may result in fees that exceed the total contract amount.
5. The Business Associate Agreement (BAA) is Fonemed’s standard agreement and does not include indemnification or payment of expenses associated with the improper disclosure or misuse of protected health information.
• The County standard BAA requires the contractor to indemnify the County for claims regarding the use, access, maintenance or disclosure of protected health information, including expenses incurred in complying with notifications.
• Potential Impact: The BAA is silent on Fonemed’s obligations to indemnify the County or pay for the expenses associated with the improper disclosure or misuse of protected health information. In the event of a breach relating to protected health information, there is ambiguity as to whether Fonemed would be financially responsible to the County for any claims arising out of that breach.
6. The Agreement does not require Fonemed to meet the County’s insurance standards as required pursuant to County Policies, 11-05, 11-07 and 11-07SP.
• County policy requires contractors to carry appropriate insurance at limits and under conditions determined by the County’s Risk Management Department and as set forth in County policy and in the County standard contract.
• Potential Impact: The County has no assurance that Fonemed will be financially responsible for claims that may arise under the Agreement.
DPH recommends approval of the contract with Fonemed, including the non-standard terms, to ensure that DPH’s FQHC patients have timely access to medical care after-hours.
PROCUREMENT
On July 14, 2023, the County Administrative Office approved and authorized the release of Request for Proposals (RFP) No. DPHE23-CO-5025 to solicit proposals from qualified and interested vendors for after-hours care services.
No agencies attended the non-mandatory proposal conference conducted on July 26, 2023. One proposal was received in response to the RFP by the established deadline, met the minimum requirements, and continued through the evaluation process.
An evaluation team comprised of representatives as experts in the field reviewed and evaluated the proposal based on criteria included in the RFP, that included but were not limited to qualifications and experience, financial review, technical review, and cost. Based on the evaluation results, Fonemed was recommended for contract award.
REVIEW BY OTHERS
This item has been reviewed by Human Services Contracts (Patty Steven, Contracts Manager, 388-0241) on December 19, 2023; County Counsel (Charles Phan, Deputy County Counsel, 387-5455) on January 3, 2024; Risk Management (Victor Tordesillas, Director, 387-8623) on December 19, 2023; Purchasing (Jessica Barajas, Supervising Buyer, 387-2065) on January 4, 2024; Finance (Iliana Rodriguez, Administrative Analyst, 387-4205) on January 5, 2024; and County Finance and Administration (Robert Saldana, Deputy Executive Officer, 387-5423) on January 5, 2024.