Lawsuit challenges San Francisco safety net programs

A recent lawsuit alleging that San Francisco officials are overcharging poor and indigent patients who seek care through safety net services has sparked more controversy over the city's unique universal health coverage program.

As in many counties, San Francisco uses a system of community hospitals and clinics to help provide medical services to such patients. In addition, the city became the first to implement a program offering all uninsured residents coverage, known as Healthy San Francisco. The initiative uses the city's existing safety net system, as well as a new network of medical homes, to provide access to primary and preventive care.

But a group of patients have sued the city's Dept. of Public Health and other city and county officials, alleging that they violated a state law requiring such public programs to base co-payments for medically necessary services on patients' ability to pay.

Instead, poor and indigent patients who otherwise would qualify for discounted or free care are being unfairly charged for emergency department visits, primary care visits, hospitalizations and medications, according to the complaint filed Dec. 30, 2008, in San Francisco Superior Court. That may include some fees charged under Healthy San Francisco, though the program is not named in the suit, said Michael Keys, a staff attorney with Bay Area Legal Aid. The organization filed the lawsuit along with the Western Center on Law & Poverty.

Some patients seeking care through various community hospitals and clinics have faced collections for bills they cannot afford or in some cases have foregone necessary care, he said.

"This is about the county failing to provide necessary medical services to eligible people," Keys said. "We absolutely support all efforts to expand coverage, including Healthy San Francisco. But equally important is the implementation of those efforts, and they need to provide the access required by law."

According to the complaint, city and county officials overseeing the safety net programs have imposed a wide variety of charges on poor and indigent patients who are entitled to medical assistance under the state's welfare law.

Keys said city and county officials have failed to conduct needs-based assessments to help determine an individual's ability to pay for such fees, instead relying solely on strict income requirements. In addition, "there is no process for letting people demonstrate they cannot afford to pay for those charges or telling them they may be eligible for free care."

Maintaining access

The city attorney's office plans to meet the plaintiffs to "explore ways to resolve their concerns," spokesman Matt Dorsey said. At press time in mid-February, the parties had just begun discussions.

Dorsey said it was unclear to what extent, if any, the lawsuit would implicate the Healthy San Francisco program, which is just one piece of the city's safety net system. "The lawsuit generally challenges the city's compliance with the state law in how it provides and bills for medical services for indigent patients," he said.

Healthy San Francisco's fee schedule was derived, in part, from fees charged in the city's existing safety net systems, which are assessed based on participants' income as a percentage of the federal poverty level, said Tangerine Brigham. She's director of the universal access program and a deputy director of the city's Dept. of Public Health. Other mandatory participation fees also may be waived for eligible patients, she said.

"We wanted to ensure that the fee structure did not impede access," Brigham said. For that reason, a public health commission that developed and approved Healthy San Francisco and its fee structure also pledged that it would continue to monitor all aspects of the effort.

The universal program is already at the center of another legal challenge. A panel of the 9th U.S. Circuit Court of Appeals in September 2008 upheld a funding mandate requiring employers to contribute to Healthy San Francisco if they did not spend a certain amount on workers' health coverage. The business community has asked the full 9th Circuit to review the case, which could eventually make its way to the U.S. Supreme Court.

The California Medical Assn. and the San Francisco Medical Society filed a friend-of-the-court brief in that case supporting the program, saying it has helped relieve the strain of the rising uninsured population on emergency departments, Medicaid and other parts of the health care system.