Assemblymember Frazier Passes AB 903 to Dissolve Los Medanos Community Healthcare District

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SACRAMENTO, CA – Today, Assemblymember Jim Frazier (D-Fairfield) passed AB 903 in the Assembly Local Government Committee.

“As all of you know, the COVID-19 pandemic has exposed critical shortfalls in healthcare and health services funding across the state. Communities of color have been especially impacted by the emergency,” said Assemblymember Frazier. “Now more than ever, we have seen the life-changing impacts of devoting every possible dollar to serving those we represent. AB 903 is a district bill that takes strides towards addressing this issue. The bill effectively creates hundreds of thousands of dollars in funding for badly needed healthcare services in the region.”

AB 903 will dissolve the Los Medanos Community Healthcare District and require the County of Contra Costa to be the successor of all rights and responsibilities of the district. AB 903 will also require the county to complete a property tax transfer process to ensure the transfer of the district’s health-related ad valorem property tax revenues to the county in order to operate the Los Medanos Area Health Plan Grant Program.

The Contra Costa Local Agency Formation Commission (LAFCO) has approved of the dissolution of the existing healthcare district, and Contra Costa County already serves the communities within district boundaries.

The Los Medanos Community Healthcare District (LMCHD) was formed in 1948 to operate the Los Medanos Community Hospital. In rural communities, such districts were created to provide for hospitals that otherwise would not exist. LMCHD operated the hospital until 1994 when the hospital closed due to bankruptcy. Since then, LMCHD has not provided any hospital, physician, or emergency medical services. Instead of providing direct services, LMCHD funds third-party agencies that provide health-related programs.

“This bill effectively creates hundreds of thousands of dollars in funding for badly needed healthcare services in the region. A lot of this funding comes from the savings on LMCHD’s extremely high administrative expenses, which topped 60% in some years,” said Assemblymember Frazier. “That is simply unconscionable.”

“Comparable programs in the county average at about 15% admin cost, and a nearby healthcare district runs at a maximum of 20% in admin costs. Rather than lose over half the funding to wasteful administrative expenses, AB 903 dedicates those dollars to the community,” Assemblymember Frazier added.

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