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  • County Administrator 5/6/2014 9:06:56 AM County Counsel 5/5/2014 4:13:01 PM COB

    5/6/2014 9:49:14 AM

    AGENDA ITEM SUBMITTAL FORM BOARD OF SUPERVISORS

    CLERK OF THE BOARD 44 N. San Joaquin Street, Suite #627

    Stockton, California 95202

    SUBMIT ONE COpy OF THIS FORM WIm EACH BOARD AGENDA ITEM.

    For Clerk's Use Only: AGENDA NUMBER

    At the time of submitting your agenda item documents, please provide ONE

  • San Joaquin General Hospital/P. O. Box 1020 Stockton CA 95201 (209) 468-6000

    April 21, 2014

    Board of Supervisors County Administration Building Stockton, California

    Dear Board Members:

    APPROVAL OF CONTRACT WITH ABBOTT LABORATORIES, INC. TO PROVIDE AUTOMATED CHEMISTRY AND

    IMMUNOCHEMISTRY INSTRUMENTS THROUGH JUNE 30, 202 11 AT AN ESTIMATED COST TOTALING $6,396,425

    RECOMMENDATION:

    It is recommended that the Board of Supervisors:

    1. Approve the agreement with Abbott Laboratories, Inc (Abbott) to provide SJGH with automated chemistry and immunochemistry instruments for a seven year period ending June 30, 2021; and,

    2. Authorize and direct the Chief Executive Officer (CEO) of San Joaquin General Hospital (SJGH) to sign the agreement with Abbott Laboratories, Inc (Abbott).

    REASON FOR RECOMMENDATION:

    Currently, the SJGH Laboratory performs over 1,000,000 chemistry and immunochemistry tests each year. The tests are performed on two chemistry and three immunochemistry instruments. These five instruments all more than ten years old, operate as independent components and are not integrated and require frequent maintenance and repairs. Laboratory employees must manually verify test values which results in slower reporting to the ordering physician and on occasion slows initiation of patient care treatments. The current technologies do not allow SJGH to complete a number of tests in-house so those complex and expensive tests are sent to other laboratories with SJGH bearing the costs.

    The Abbott analyzers are a highly automated system that significantly reduce report turnaround time, reduce the number of staff needed to perform these tests, allow for more tests to be performed in-house at a significantly reduced cost, and facilitate the automated testing, storage and retrieval of samples for the performanqe of additional testing if ordered at a later date. !

    I

  • Board of Supervisors April 21,2014 Page Two

    The Abbott instruments are all connected by an automated sample delivery system that moves the sample from the intake unit to the centrifuges, the chemistry, immunochemistry instruments, and finally into the storage refrigerator. The newer technology can release test results automatically from the ma!chines as soon as they are tested. This feature is especially valuable at night when s~affing consists only of two Clinical Laboratory Technologists and one Laboratory Assistant. Blood bank activities for trauma patients can tie up both Laboratory Technologists to deliver blood to the patients. With the new system, tests can be completed and reported to the rest of the Hospital and to the Emergency Department in a timely manner without requiring the Laboratory Technologists to abandon their blood bank duties.

    The new equipment will also have advanced testing capabiliti~s that are not presently available in SJGH's laboratory. This enhancement will allow the laboratory to test more specimens in-house thereby reducing turnaround times and some of the costly send-out tests to other labs.

    FISCAL IMPACT:

    Presently, SJGH annually spends $653,460 on reagents and other supplies to perform chemistry and immunochemistry tests in the SJGH laboratory and pays an additional $251,420 to other laboratories to perform tests that cannot b completed in-house. The total annual cost for these tests is $904,880. I

    I

    The new equipment will allow SJGH to perform the send-out tests noted above in-house for only $76,100. Based on the current volume, the projected annual payment to Abbott to perform the current in-house tests and the previous send-out tests is $913,775 or $6,396,425 over the seven year term of the agreement. This is an annual increase of $8,895 over current costs.

    The process to install and validate the new automated equipment will take several months. During this time, the laboratory will run both the old manual system and the new system at the same time. This is a very labor intensive process. Once the new system is fully validated and can operate as a standalone, it will enable the reduction of at least two full-time equivalents in the laboratory resulting in a future annual salary savings of approximately $171,600. As such the net annual operational savings after the first year of implementing the Abbot system is estimated to be $162,705. The cost of setup and operating the new system is included in the proposed 2014-15 Hospital Enterprise Fund budget. The future salary savings will be included in the subsequent six fiscal years.

  • Board of Supervisors April 21,2014 Page Three

    Current Cost Abbott Contract Reagents & test costs $653,460 $913,775 Outside laboratory costs 251,420 Laboratory staff costs 171,600 Total annual cost $1,076,480 $913,775 Annual savings * $162,705

    * Annual savings once system is fully-implemented

    ACTION TO BE TAKEN FOLLOWING APPROVAL:

    Because of the complexity of the multi-part agreement and the associated documents, County Counsel recommends for clarity and brevity that upon approval by the Board of Supervisors, the CEO will execute the master agreement and related documents and implement the agreement.

    DKC:RA:sl Board Letter - Abbott Laboratories

    cc: Auditor-Controller County Counsel Purchasing & Support Services Clerk of the Board

    Sincerely,

    (lQ){ L1L-David K. Culberson Chief Executive Officer San Joaquin General Hospital

  • Before the Board of Supervisors County of San Joaquin, State of California

    B----

    MOTION:

    APPROVAL OF CONTRACT WITH ABBOTT LABORATORIES, INC. TO PROVIDE AUTOMATED CHEMISTRY AND

    IMMUNOCHEMISTRY INSTRUMENTS THROUGH JUNE 30, 2021 AT AN ESTIMATED COST TOTALING $6,396,425

    It is recommended that the Board of Supervisors:

    1. Approve the agreement with Abbott Laboratories, Inc (Abbott) to provide SJGH with automated chemistry and immunochemistry instruments for a seven year period ending June 30, 2021; and,

    2. Authorize and direct the Chief Executive Officer (CEO) of San Joaquin General Hospital (SJGH) to sign the agreement with Abbott Laboratories, Inc.,(Abbott).

    I HEREBY CERTIFY that the above order was passed and adopted on _______ by the following vote of the Board of Supervisors, to wit:

    AYES:

    NOES:

    ABSENT:

    ABSTAIN:

    MIMI DUZENSKI Clerk of the Board of Supervisors

    County of San Joaquin State of Cali fomi a

    !

  • MASTER AGREEMENT

  • M STER AGREEMENT - NOVATION ABBOTT LABORATORIES INC., D943, CP1-4, 100 ABBOTT PARK ROAD, AS on PARK, ILLINOIS 600646095

    AGREEMENT. Customer (idenllficd above) and Abbott Loborotoric~ Inc. ("Abbott") cntor into this Member Agreement ("A9reement") and agree to be legally bound to the following terms and conditions:

    1. EFFECTIVE DATE AND CONTRACT TERM. Aller this Agreement is signed by Customer and Abbott. it shall become effacti~e as of the dale noted with the authorized Abbott signature or the date, if any, appearing here as the Effective Date , ("Effective Date'). Unless terminated earlier as provided for in this Agreement. the A1)reement shall continue in effect for the period of time designated above as the "Initial Contract Term." This Agreement will autumalically renew ror ~ol1secutive oneyear e.tension periods (each an "E,'ension Perioo') ullle~s eiltierllarty yivtls lhe olliel parly nlnely (90) days' aClvance written notice of non-renewal prior to the end of the Initial Contract Term or thereafter during any Extension Period The Initial Contract Term and all Extension Periods shall be defined as the 'Contract Term."

    2. EQUIPMENT. (2.1) Equipment subject to iIlis Agreement is itemizeCl on the attached Price Exhibit(s) with a designation of ownerShip. Equipment owned by Abbott and renteCl 10 Customer is defined as 'Abbott Equipment." "Customer Equipment" shall be defined as equipment sl.lbject to a Service Package pursuant to Section 21 and which is either. (a) purchased by Customer pursuant to this Agreement or (b) being purchased by Customer simultaneously with the execution of this Agreement. Abbott Equipment and Customer Equipment shall collectively be referred to as 'Covered Equipment." Within thirty (30) days of Covered Equipment delivery, Customer shall inspect Covered Equipment and shall notify Abbott in writing of any visible damage or deficienCies. Failure tQ notify Abbott of such damage or deficiencies within sl.lch thirty (30) day time period shall be deemed as Customer's acceptance of Covered Equipment in undamaged condition. (2.2) Installation and Acceptance. Unless otherwise agreed in writing between Abbott and Customer, Customer shall stri~e to complete acceptance testing within a period of sixty (60) days, but notWithstanding the foregoing, Customer shall have a period of ninety (90) days from dat~ Customer ancJ Abbott agree that pre-integration in'tallation of EqUipment purchased or leased from Abbott is complete to conduct acceplanc .. testing of Such E~uipmant. Acceptance lesting may include, but is not limited to, safety testing. calibration, performance testing, documentation inspection and testing for adherence! to the Equipme nt's specifications. A validation package, signed off by Customer, demonstrating instrument performance specifted in Abbott's published docUlhentalion

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