Mayor London Breed and supervisors Hillary Ronen and Matt Haney announced legislation last month that combines their proposals to fix The City’s mental health care system. (Kevin N. Hume/S.F. Examiner)

Mayor London Breed and supervisors Hillary Ronen and Matt Haney announced legislation last month that combines their proposals to fix The City’s mental health care system. (Kevin N. Hume/S.F. Examiner)

Supes to vote on proposal for more services to treat mentally ill, substance users

Proposed Mental Health SF program costs capped at $150M annually

A compromise proposal to mandate the expansion of mental health services in San Francisco to help thousands of residents could cost up to $178 million a year, according to a new report, but a cap is built into the effort to keep costs below $150 million.

The legislation to create Mental Health SF was introduced on Nov. 12 by Mayor London Breed after negotiations with supervisors Matt Haney and Hillary Ronen, who were planning to take a similar measure to the voters.

The Board of Supervisors Budget and Finance Committee is scheduled to hold a special meeting on the proposal on Friday, Dec. 6, and could vote to send it to the full board for approval on Dec. 10, the following week. The legislation has the backing of all 11 members of the Board of Supervisors.

The intent of the program is to expand services to adequately serve thousands of adults experiencing homelessness and suffering from mental illness and substance use who are uninsured, enrolled in Medi-Cal or who are released from jail and waiting for enrollment in Medi-Cal.

The Department of Public Health estimates that there are about 4,000 people who fit this criteria and “who would benefit from accessing mental health and substance use treatment services but are not routinely doing so,” according to the budget analyst report released Tuesday.

The report says the legislation would cost around $8.8 million in one-time costs and from $102 million to $178 million in annual ongoing costs.

The department’s estimate assumes “a phased in approach for supporting the target population and that individuals will ultimately transition to less intensive services over time,” the report said, and adds that “the actual costs will vary greatly depending on program models, service levels and funding.”

One-time costs include $8 million to create the required Mental Health Services Center in a building owned or leased by The City that is staffed 24 hours a day, seven days a week. The center would have the ability to “assess incoming patients’ care needs, prescribe and fill medication, provide urgent mental health care for patients at or near psychiatric crisis, and provide transportation” for patients leaving San Francisco General Hospital or the jails.

The center would cost between $18 million and $22 million annually to operate.

The remaining $800,000 in one-time costs would go toward the creation of the required Crisis Response Street Team, which “would complement the existing Homeless Outreach Team by engaging persons on the street experiencing crisis regardless of whether they are housed and would be available at all times.” The crisis team would cost between $4 million and $6 million a year to operate.

The required Office of Coordinated Care would cost between $20 million and $35 million annually to perform such duties as “keeping an active inventory of the capacity of all mental health programs operated or funded by the City” and “providing case management to individuals accessing services.”

The costs for expanding treatment services like beds in residential treatment centers is estimated at between $40 million and $85 million a year.

There are other yet-to-be determined one-time costs, the report said.

There is no cost estimate yet for launching and operating the required Office of Private Health Insurance Accountability to help those in need get their care reimbursed by medical insurance providers.

“The cost of providing the proposed new services would be partially offset through fees and insurance reimbursements,” the report said.

The proposed ordinance would allow the director of the Department of Public Health to set fees for users of Mental Health SF services.

Backers of the plan are considering generating funding for the mandated services through a broader effort to ask voters to change the rates of The City’s current gross receipts tax on businesses. Haney and Ronen are also considering a separate gross receipts tax measure, should the broader reform measure not work out.

There is a cap on the proposed program costs in the legislation so that while services mandated by the proposal could hit the high-end estimate, they couldn’t exceed $150 million a year. The cap is adjusted annually by the consumer price index.

In the event that the cost of the required services exceed the cap, it is up to a working group to figure out how to bring them under the cap. “The Implementation Working Group would be required to develop recommendations on how to reduce the scope of the required new services so that the annual cost is below this threshold,” the report said.

The working group would consist of 11 members, six appointed by the board and five by the mayor.

None of the mandated services would be required unless one of three conditions are met: The City’s total budget has increased by 13 percent from the prior fiscal year, voters approve a new or modified tax to pay for them or the Board of Supervisors approves funding them through the budget process.

The service mandate expires on Sept. 1, 2026.

The Department of Public Health currently provides mental health and substance use disorder services to more than 30,000 San Francisco residents annually at a cost of about $370 million, the report said.

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