Q. Why a Public Hospital District? We have had medical care on Vashon for many years without one, why have a Public Hospital District now?
A. The short answer:
The goal of the Public Hospital District is to ensure that high-quality primary care and urgent care including after-hours care is available to all members of our community in a financially sustainable manner now and for generations to come.
Medicare, Medicaid and other health insurance reimbursements to rural primary care medical practices don’t cover all the costs of providing services. The practice of medicine in rural areas is acknowledged to be more expensive than in urban areas. Recently, those deficits have been covered by generous members of our community and by the Neighborcare Health organization. That funding, however, is neither sustainable nor predictable. The current medical service provider is a Federally Qualified Health Center (FQHC). This structure allows it to receive enhanced Medicaid and Medicare payments and to serve uninsured patients. Even with these enhanced reimbursements the clinic is running an unsustainable deficit. The revenues received from both government programs and from third party insurers fall well short of the expenses of providing the service.
The more detailed version:
1) Health insurance reimbursements to medical practices don’t cover all the costs. Medicaid and Medicare, which cover many island citizens, are typically the two lowest payers. In addition, many services to patients are not covered by private insurance at all or are bundled in with other payments.
2) With so many patients on government insurance programs like Medicare and Medicaid, clinics are more vulnerable to government cuts in those programs. For that reason, and due to low reimbursement rates, some mainland and many Island practices limit how many such patients they will accept or they accept none at all.
3) The Affordable Care Act made it possible for many more people to be insured on Medicaid (Apple Health, in Washington), thus increasing the numbers of patients with the lowest-paying health insurance. Our island community has a higher than average percentage of citizens qualifying for Medicare, and this further strains the unreimbursed costs for many service providers.
4) Some services to visitors and part-time residents are barely covered at all if an off-island doctor ordered them (example: blood draw for labs).
5) The rising cost of health insurance premiums has caused small employers to offer scantier health benefits, or none at all, forcing employees into the individual insurance market, or even to go without insurance. Being uninsured or under-insured, is more common in rural communities, putting a greater burden on rural practices to provide charity care, or sliding scale payments – often at a loss to the provider.
6) New technologies and regulation in health care delivery have increased the cost of operating a practice. Electronic medical records and participation in government health outcome improvement regulations, for example, are required for any practice receiving Medicare payments. Not participating in these programs results in penalties and lowered reimbursements, however the cost of technology and the extra staff to comply with regulations is not adequately funded.
7) Two years ago, Neighborcare Health established its rural practice at the medical clinic building on Sunrise Ridge, but they were clear that extra funding would be necessary, at a minimum for the first two years on the island. The deficits projected for the practice and which were covered by the community for the first two years continue. Neighborcare Health is a non-profit organization serving many communities in addition to ours and cannot be expected to shoulder the economic burden alone . If supplemental funding is not available Neighborcare Health will be forced to leave. Even if other providers could be found to operate a practice in the current medical clinic building, that practice would also need additional support beyond government funded programs, insurance reimbursement and patient self-pay. There is no incentive for any new service provider to come onto the island and run the clinic at a loss. Our community must participate in the financial support of medical services if we are to have a clinic accessible by all island residents.
Q. What is a Public Hospital District and how will it function?
A. The Public Hospital District is:
1) Owner and operator of health care facilities and services
2) Owner of health care facilities and lessor of the facilities to another party who acts as the operator
3) Lessee of health care facilities and operator
4) Contractor for health care services
Q: What are the duties and responsibilities of the Commissioners?
A: The Commissioners will manage the District and fulfill its goals. Their first task is to assess the needs of the district and evaluate current services. The duties of the commissioners are outlined in State Statute RCW 70.44 RCW and include but are not limited to:
- adopting bylaws governing the transaction of the commission’s business
- leasing of health care facilities
- establishing rates for the services provided by the district
- incurring debt
- levying taxes
- preparing an annual budget, holding a hearing on the budget and approving the budget
- appointing a superintendent, removing the superintendent and establishing the superintendent’s compensation
- approving plans to acquire or construct district facilities
- appointing the district’s treasurer and internal auditor
- approving orders or vouchers pursuant to which district funds are disbursed
- approving consolidation of the district with another district
- approving contracts for services on behalf of the district.
Q. Who is proposing the Public Hospital District for Vashon?
A. The Vashon Maury Health Collaborative is a group of concerned citizens who formed the group to pursue solutions to ensure that high quality primary care (including after-hours care) is available to all the members of our community in a financially sustainable manner now and for generations to come. The Collaborative is not aligned with any single medical practice or organization. After many meetings to address our goal, the Collaborative assisted a group of volunteers to petition the King County Council for the placing of a proposal for a public hospital district on the ballot.
The VMHC reached the conclusion that (1) public funds are needed to assure sustainable and predictable support for health care on Vashon Island, (2) all current primary care practices on Vashon should be considered for that support and (3) who the voters elect as Commissioners would be critical, since they will have the legal responsibility to decide the levy rate, what health care services will be supported by the PHD, how to structure those services, and how to equitably disburse the funds.
Health Care for Vashon is a campaign committee which has been formed to advance the proposal for a Public Hospital District and the election of commissioners following the qualification of the citizen petition for a ballot measure in November of this year.
Q. Why must it be called a Public Hospital District when it will not have a hospital?
A. By Washington State law (RCW 70.44) any legally established district that supports healthcare services for the citizens in that district must be called a Public Hospital District. However, the law also states that the term “Public Hospital District” or “District” means a public health care services district. There is no intention or desire to create a hospital on Vashon. The small population could not support such a facility. The intent is to create a health care services district which supports and administers the operations of a clinic and/or other medical facilities.
Q. Why won’t the levy rate be on the ballot measure?
A. Washington State law does not allow placing a levy rate on the ballot for a Public Health District. It can only state that the maximum rate can be $0.75 per $1,000 of property value. The Commissioners, who would be elected at the same time as the proposal is passed, are empowered to survey the needs of the community, prepare a budget to meet those needs, and determine what the rate will be.
The specific financial needs of the health clinic(s) that would receive assistance cannot be determined at this time because of potential changes in the scope and nature of the services being provided. Additionally, the wisdom and timing of a capital campaign for facilities needs consideration. It can be stated with assurance however that the current operating deficit experienced at the clinic is not at all atypical of rural primary care facilities and may well represent the minimum deficit we could expect in other service configurations.
It will be important to elect Commissioners who are committed to being good financial stewards while achieving the goal of ensuring that high quality primary care (including after-hours care) is available to all members of our community now and for generations to come. This is a challenging task, and the election of commissioners who collectively present the necessary skillsets is crucial.
Q. What would it cost me?
A. The precise amount of a District levy is determined by the Commissioners you elect. However, we can know the maximum possible amount that would be paid by a taxpayer if every Local District levy that has been proposed were to be approved. Under today’s assessed values by the King County Assessor’s office, a property valued at $500,000 would pay an additional $225 per year in property taxes. A property valued at $1 million would pay $450 per year, and a property valued at $250,000 would pay an additional $112.50 per year.
What Approving a New Public Hospital District Would Cost a Property Tax Payer:
|Property Value||Additional Tax per Year|
Q. How did you reach those numbers?
A. A Public Hospital District (PHD) falls within a group of districts that share a $5.90 per $1,000 of assessed property value limitation for local district taxing purposes. This means that the total of property tax assessments by all these districts cannot exceed $5.90 per $1,000 by law.
This $5.90 limit applies to County Current Expenses and County Roads (known as Senior Districts), Fire Districts, Hospital Districts, Parks Districts, Cemetery Districts and Flood control Districts and others.
The levy (or taxes charged) by each individual district subject to this $5.90 limit is reduced if the cumulative total of the districts’ levies would be in excess of $5.90. The process of reducing the levies of the districts is based on a ranking of the districts from more senior, to more junior. This process is called “prorating.”
This year, with property assessments as established by the County Assessor’s office for 2019, if every one of the districts already existing received the entire levy they asked for, there would be $0.40- 0.45 available within that $5.90 limit. Therefore, the additional cost of a newly formed PHD under the 2018 assessments of Vashon property values could not exceed 45 cents per $1,000 of assessed value.
This means that a property valued at $500,000 would pay an additional $225 per year in property taxes. A property valued at $1 million would pay $450 per year, and a property valued at $250,000 would pay an additional $112.50 per year. As a point of comparison, Vashon Island Fire and Rescue charges $700 and 15 cents per mile for a single off-island transport (“Transport fees come back into focus at fire district” Vashon-Maury Island Beachcomber, December 5, 2018).
Q. What happens if the Public Hospital District does not pass?
A. We will lose the service provider that currently operates the clinic, and there is no replacement on the horizon. Without community support, there is little incentive for any qualified community medical system to step in to operate a clinic at a loss. If we as a community will not support our healthcare, there is no logical reason to believe that someone else will.
Q. How can I vote for a Public Hospital District if I don’t know what it will be used for and how much it will cost me?
A. We will have to elect Commissioners we trust both for their competence and their intentions. By law, Pubic Hospital Districts require that the voters create the district and elect Commissioners who will determine how much the levy will be (except that the maximum cannot exceed $0.75 per $1000 of property value). While that is frustrating to many of us, it is the way the law is written for this type of district. The citizens who are putting this measure on the ballot would prefer to do it in two stages; creating the District and electing the Commissioners in the first stage, and then coming back to the voters in stage two with a specific rate proposal. Unfortunately, this approach is not allowed for Public Hospital Districts. However, the Commissioners are required to hold all meetings in public where citizens will have a full opportunity to learn what is being considered and to comment. The public owns this District and their continuing participation is important.
It is important for us as a community to take our health care into our own hands to solve this issue and ensure that high quality primary care (including after-hours care) is available to all the members of our community in a financially sustainable manner now. We are confident there are at least five people in our community that we can trust to perform the function of Commissioners competently and with the interests of the members of our community uppermost in their minds.
Q. What can the funds be used for? What other medical services might the Public Hospital District provide now or in the future? Who will decide what services and providers will be assisted?
A. By law, the definition of “Health Care Services” is broad. In addition to operating hospitals, the funds from a Public Hospital District may be used for primary care services (daytime and after-hours). Additional services that might be provided include extended care, long-term care, outpatient, rehabilitative, health maintenance, and ambulance services and other such services as are appropriate to the health needs of the population served.
Because the scope is broad, a Public Hospital District on Vashon could support the existing clinic, after-hours and (possibly) urgent care, home visits, and other community health care needs.
The elected Commissioners would be empowered to survey , evaluate, and prioritize the healthcare needs of the community to determine what services need support. Based on that evaluation, they would determine a budget and contract for services to satisfy those needs.
Q. Will after-hours care be supported by the Public Hospital District?
A. By law, the Commissioners are responsible for determining what services will be supported with the funds generated. Past informal surveys have already indicated that after-hours care and urgent care are major concerns of the members of our community. Those services would be high priority considerations for usage of the funds.
Q. Would the funds be distributed to all the existing providers on Vashon? Who decides that?
A. The elected Commissioners are by law responsible for making that decision. The VMHC believes that it will be important to elect Commissioners who are committed to prioritizing funds for primary and urgent care practice on Vashon.
The proposition for creating a Public Hospital District cannot legally specify recipients of the intended funding. That decision is reserved to the elected Commissioners following their assessment – with public input – of local health care needs. Thus, the proposition does not guarantee that any of the current providers will be funded. Candidates for the five Commissioner positions may state their positions on this issue and/or on their priorities for funding targets.
Q. Does our current Health Clinic operator support a Public Hospital District?
A. Yes, Neighborcare Health supports the formation of a Public Health District. However, it is important to realize that elected Commissioners may or may not find that Neighborcare Health is the medical provider best suited to the provision of all or some of the medical services for Vashon Island. The Public Hospital District Initiative is not for or about Neighborcare Health. It is about establishing a sustainable structure for services. It is also about finding providers best aligned with the health care needs of the community.
Q. Is there a way to reduce the tax rate in the future?
A. Yes, if national or state health care reforms lead to reduced costs or increased payments to medical providers and if the practices or services of other Districts someday consolidate into a clinic operating at maximal cost effectiveness, it should be possible to reduce the tax rate which is determined on an annual basis. The rate could also change in the event property assessments continue to increase, thereby creating a yield for the levy rate that exceeds the amounts needed for operations and capital accounts.
Q. Is there another way to fund health care on the Island?
A. Historically, deficits on Vashon Island have been covered with philanthropic support, and with the support of Granny’s Attic. Philanthropic support has been seen in other contexts to be unsustainable and unpredictable. Granny’s Attic cannot support the operating deficits of a modern primary care practice alone and particularly withother competing demands for community support. Other rural communities in the Northwest (including Lopez Island, Orcas Island, San Juan Island and others) and across the country have faced the same dilemma and have consistently concluded that the best way to ensure the provision of high-quality primary and after-hours care is through a Public Hospital District. An alternative approach might be welcomed, but we as a community need a solution that we can begin implementing now, for the next year and beyond. If nothing is done to resolve the annual revenue shortfall it is entirely possible that primary care might not be available on Vashon Island. Once a sustainable and predictable source of revenue is established by means of public revenues, other complementary sources of funds such as a foundation can be effectively developed.
Q. Will there be information provided on the financial projections and funding options for the proposed Public Hospital District?
A. It would be ideal if solid financial information was available before voters cast their ballots. By law, it is the responsibility of the elected Commissioners to determine the financial needs of the services they will be supporting with levy funds. The Commissioners will have to assess the primary, extended care and urgent care needs on Vashon and then determine what it would take to meet those needs. This is a projection and budgeting process allocated to the commissioners by law. Again, this demonstrates the importance of who is elected to serve as Commissioners. The commissioners will develop their budget in a process subject to public input and public scrutiny.
Q. What checks and balances are in place to monitor the Commissioners’ decisions regarding how the monies are distributed and what the levy rate will be?
A. By law, the Commissioners will hold public meetings to conduct District business. Anyone can attend these meetings. If voters disapprove of what the Commissioners are doing, they can vote them out of office. The commissioners will serve staggered terms. Given five at-large Commissioners (as is proposed) one position is up for re-election in the next general election and two more positions are up for re-election in each of the following two general elections. Upon re-election, Commissioners serve a 6-year term, as would all Commissioners after that. The duties and the responsibilities of the commissioners are set forth in Washington state statutes. The commissioners’ fidelity is governed both by law and by the scrutiny of the public electing them.
Q. What is needed to pass the Public Hospital District?
A. To pass the Public Hospital District, 50% of those who vote in an election, plus 1 more vote must approve the measure. It is also necessary to have at least 40% of the vote count from the last general election to validate the election. Approximately 8,000 voters turned out in the last general election. Forty percent of that number or approximately 3,200 voters are needed to vote on the issue to validate the election. There are approximately 9,000 registered voters on Vashon. It is assumed that many registered voters will want to take a position on such an important issue. (Note: Exact figures are being reconciled with King County Elections data).
Q. How will the Public Hospital District affect our Fire/EMS services and/or their levy?
A. There will be no direct immediate impact on the Fire/EMS levy. The Public Hospital District will not take over EMS on Vashon. If anything, ensuring a financially sustainable delivery of primary, after-hours and (potentially) urgent care will help to improve the working relationships between medical providers and the Vashon Island Fire Department. The Public Hospital District and Fire District will be expected to collaborate closely to coordinate their efforts. As a relationship matures there may be areas of cooperation between the districts that would create cost savings, greater efficiencies, and enhanced services.
Q. What have citizens on Vashon indicated that the members of our community want?
A. After-hours and urgent care have been identified as top priorities. Also identified has been more available staffing for primary care, a wider array of services and less wait time for appointments. Another identified goal is the reduction of unnecessary medical evacuations off-island.
Q. How is passing a Public Hospital District consistent with who we are as a community?A. The members of our community have a long history of coming together to meet community-wide needs that are important to us all. We are committed to living in a place where we care for each other and everyone’s well-being. As a community, we also must take more control of essential services, so they meet community needs.
It is time for Vashon to step up to stable public funding, as our neighbor islands and other rural areas have done. We also need transparent public management of health care resources if we are ever going to achieve the balance of efficient primary, extended and urgent care that we need. Medical services are a fundamental aspect of community support. Studies have shown that the loss of medical services in a community lead to the degradation of other services, property values, and community “livability “.
Q. What is the difference between primary care, urgent care including after-hours care and emergency care?
A. Primary care is usually your first stop in getting health care for you and your family. Your primary care provider can help treat common illnesses and minor injuries. Preventative care is often the goal of primary care medicine. If specialty care is needed, your primary care provider can coordinate your care and make necessary referrals to specialist physicians for your specific medical condition. Your primary care provider can also help you manage your overall health by knowing you and your medical history. Primary care providers manage chronic disease. Primary care providers treat medical concerns that do not necessarily require immediate attention.
Urgent care is the kind needed right away, to help you with non-life-threatening medical issues that could become worse if not treated immediately. The key word here is non-life-threatening. Urgent care generally requires different staffing models and different provider certifications than primary care, thus the expense tends to be greater.
Emergency care is for serious medical conditions that threaten a person’s life or limb. For these medical conditions, every second counts. EMS on Vashon is the appropriate service for 911 emergency care.
Q. If this tax is based on property values, what about renters?
A. While it is up to individual owners of rental property, most owners determine the rent charges based on the costs to the property, including property taxes. It is possible that owners will pass along the additional costs to renters.
Q. What happens if the monies collected are not spent?
A. Any unspent monies in a fiscal year would be carried over to the next year. If that is a substantial amount, it would enable the Commissioners to reduce the levy the next year or determine if the voters want some other service provided through the district.
Q. Is there a time limit for spending the money that is collected?