County Official Sees Federal Waiver Soon for Health Costs

The county’s chief administrative officer told Wall Street analysts and bond rating agencies in New York that he believes the county will receive a federal waiver by the end of the month to help pay the cost of its vast public health care system.

David Janssen said negotiations with federal and state representatives will resume Monday, and he expects agreement will be reached to extend the waiver of federal Medicaid regulations by June 30, when the current five-year federal bailout of the health system expires. But Janssen said that it’s unknown when that agreement will be concluded and what it will look like.

His comments were made Thursday as top county officials paid a visit to Wall Street to obtain ratings on a $600 million short-term borrowing needed to cover the county’s cash flow needs in the new fiscal year, which begins July 1. The tax and revenue anticipation notes are popular with higher-income investors because they are exempt from state and federal income taxes.

Dan Stone, a public finance director with Standard & Poor’s in San Francisco, said the firm will evaluate the county’s cash-flow projections and issue a rating on the borrowing early next week. He said there is “certainly a good chance that it would be rated similarly to this year,” when the county’s short-term borrowing received the agency’s highest credit rating.

Without an extension of the waiver of Medicaid rules, county officials say, they may be forced to close outpatient clinics, lay off doctors and nurses, and scale back health services to the nearly 3 million residents who lack health insurance.