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County moves to clarify SJ Health governance, co‑applicant agreement and supplemental-funding allocations
Summary
County staff outlined proposed changes to the co-applicant agreement with the San Joaquin County Clinics board, said they will seek board approval of an updated agreement and MOU, and previewed a proposed three‑year extension of the hospital management services agreement.
County officials told the Health Care Services Review Project Committee they will seek changes to the governance and operating agreements that underlie the county-run clinic system (SJ Health) to improve oversight, clarify fiscal authority and align incentives across the county's clinics and hospital.
Brandy Hopkins, speaking for county administration, said the county is the HRSA designee for the county clinics (FQHC look‑alikes) while the San Joaquin County Clinics (SJCC) board — a 501(c)(3) created to serve as the co‑applicant — fulfills HRSA’s requirement that the clinic governing board include a majority of patients. Hopkins said the county and SJCC board approved a set of proposed co‑applicant agreement revisions on April 9, and county administration will present recommended co‑applicant agreement changes to the Board of Supervisors on April 22.
Hopkins said proposed changes would organize SJ Health under the county’s Healthcare Services department (as a dotted‑line relationship to the SJCC board per HRSA rules), eliminate a current liaison committee in favor of a search committee for hiring a permanent project director, clarify the county’s status as HRSA designee, and strengthen county authority over allocation and distribution of supplemental funding (outside HRSA scope). The county’s staff said the current memorandum of understanding (MOU) governing interdepartmental services and supplemental‑fund allocations expires June 30 and will be redesigned; the current MOU allocates 36% of certain supplemental (QIP) dollars to SJ Health with the remainder to the hospital, and county staff said they will propose a model that aligns distribution based on need, quality and participation.
Hopkins said county staff will return recommendations to the Board of Supervisors in April (co‑applicant agreement) and that the county administrator’s office will put affected departments on notice to redesign the MOU ahead of the June 30 expiration. On the hospital partnership, Hopkins and county staff said the county will recommend a three‑year extension of the management services agreement (MSA) with CommonSpirit for board consideration on May 13; county officials said CommonSpirit has helped generate about $50 million in savings to date under the agreement and recommended continuing the quarterly oversight meetings with CommonSpirit. County counsel and the CAO’s office said they are also discussing a community board of advisors with limited delegated oversight for credentialing and quality matters.
County presenters emphasized that QIP and other supplemental programs are outside HRSA’s scope and that the Board of Supervisors — not HRSA or the SJCC board alone — should provide policy direction on how those funds are used. They said the revised co‑applicant agreement and a redesigned MOU will clarify operational responsibilities, compliance with county fiscal and personnel policies and dispute‑resolution language.
No formal change to the co‑applicant agreement, the MOU or the MSA was approved at the committee meeting; staff said formal actions will be scheduled for the full Board of Supervisors on April 22 (co‑applicant agreement) and May 13 (MSA extension).
