Financial woes jeopardize LA Hositals

From the Los Angeles Times

Financial woes jeopardize area hospitals

Nearly two dozen are at risk. Losing even a few would mean greater strain on the region's healthcare network.

By Daniel Costello and Susannah Rosenblatt
Los Angeles Times Staff Writers

September 23, 2007

excerpts:

Nearly two dozen private hospitals in Los Angeles and Orange counties, accounting for up to 15% of beds in the region, are in dire financial straits and in danger of bankruptcy or closure, according to hospital administrators, industry experts and state data.

The troublesome development follows the closure of community clinics and hospitals in recent years that has left the healthcare system seriously overburdened.

If even a few other hospitals close or reduce costly critical-care services, it could mean longer ambulance rides to hospitals, additional delays in emergency rooms and less access to care, especially for poor and uninsured people.

Among the hospitals in poor financial health, according to industry analysts, are Downey Regional Medical Center, Centinela Freeman Health System in Inglewood, Brotman Medical Center in Culver City, Century City Doctors Hospital and four Orange County hospitals owned by Santa Ana-based Integrated Healthcare Holdings Inc. including Chapman Medical Center in Orange and Western Medical Center in Santa Ana, one of three trauma centers in the county.

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The financial woes result from a multitude of developments:

* An increasing load of uninsured and low-income patients has resulted from overcrowding and the shutdown of public facilities. The number of uninsured patients visiting private hospitals, particularly in poor areas, has increased by one-third in Los Angeles County since 2002. California's Medi-Cal program for the poor reimburses hospitals at one of the lowest rates in the country.

* The closure of Martin Luther King Jr.-Harbor Hospital in Willowbrook last month left half a dozen nearby hospitals to absorb most of the 47,000 patients who used the public hospital's emergency room last year.

* Smaller community hospitals are drawing fewer patients as a few larger facilities attract a growing share of doctors and insured patients.

* As insurers have consolidated in recent years, they've squeezed many smaller facilities. Private insurance companies generally pay higher rates to larger hospitals with greater bargaining power.

* New, stricter state mandates on nursing ratios have raised labor costs, and a 2013 deadline to retrofit all hospitals to better withstand a major earthquake is estimated to be costing medical facilities $110 billion statewide.

Since 1996, more than 70 community hospitals have closed across the state, with a disproportionate share -- more than 50 -- in Southern California. Regionally, 14 emergency rooms have closed in the last five years, including 10 in Los Angeles County.

That's why experts say a new wave of closures would be so destabilizing.

"In many areas, you have had enormous consolidation, and there's very little breathing room left," said Kirby Bosley, director of California healthcare consulting for Watson Wyatt, a company that advises employers on health plans.

Many agree, however, that it's been years since so many hospitals have been in such dire financial straits at the same time.
In a few years' time, it's inevitable our community's already horrendous statistics of heart disease, cancer and diabetes will rise even more," she said.

The most immediate concern is how to best address the fallout from the closure of King-Harbor, which was shut down last month when the federal Medicare and Medicaid agency pulled half the hospital's funding after nearly four years of failed attempts to reform the troubled institution.

"Regardless of what everybody's trying to do, there's not enough money," said Carol Meyer, director of governmental affairs for the L.A. County Department of Health Services.

"We're talking about a system that is already in crisis," she said. "I think this is a tipping point for a couple of hospitals in the immediate area."

States and Cities Lag in Bird Flu Readiness - New York Times

[ Originally published 2/6/06 -- How are we doing on this one?
To my knowledge, hospital surge capacity is less than it was 18 months ago. ]

States and Cities Lag in Bird Flu Readiness
February 6, 2006
New York Times

By DONALD G. McNEIL Jr.

High-points:

WASHINGTON, Feb. 2 — The nation's 5,000 state and local health departments are rushing to plan for an epidemic of avian flu, but they say they are hobbled by a lack of money and guidance from the federal government.

"It's a depressing situation," said Jeffrey Levi, a flu expert at the Trust for America's Health, a nonpartisan health policy group. "We are way, way behind."

"..That $350 million sounds like a lot, but divided among 5,000 health departments, it's only $70,000 each," ...

"If we prepare now," Dr. Gerberding said, "we may be able to decrease the death rate and keep society functioning."

Dr. Harvey V. Fineberg, president of the Institute of Medicine, the medical arm of the National Academy of Sciences, was more pessimistic. "We're completely unprepared," Dr. Fineberg said...

There are few local stockpiles of even the simplest precautionary items, like masks and hand sanitizers, and none of expensive equipment, like $30,000 ventilators.

And many states are chronically short of public health money.

But Dr. Isaac B. Weisfuse, the deputy city health commissioner in charge of flu planning, said he expected the first wave of any pandemic to swamp city hospitals; 67 percent of all intensive care beds, he said, would be filled with flu victims.

Officials interviewed from a dozen states named questions on which they want federal guidance so they do not set different policies, including these:

¶When should we urge citizens to wear masks?

¶When should we close schools?

¶If a vaccine arrives, who gets it first?

¶When should patients be taken off ventilators?

Dr. Levi, of Trust for America's Health, gave an example of a dilemma that could arise at George Washington University, where he teaches: If a dorm had one infected student, should everyone else be sent home for their own safety, or padlocked in to keep them from spreading the virus to their hometowns?

"Right now, that's up to individual schools to figure out," he said. "That's no policy."

Thomas W. Skinner, a spokesman for Dr. Gerberding, the C.D.C. director, said, "These are tough questions that will take time to answer, and we'll work with the states to help them come up with answers."

The agency also realizes that health districts need more money for preparedness, Mr. Skinner said.

But the biggest danger, public health officials said, is the one over which they have the least control: hospitals in their regions, most of which are privately owned, cannot handle big surges of patients.

Dr. Roger P. Baxter, head of flu preparedness for Kaiser Permanente, said his Northern California hospital network was "probably better off than 90 percent of the health systems out there, and we have no surge capacity."

"We're a business, and we operate on a thin margin," Dr. Baxter said. "We don't have extra ventilators."

"Even in normal flu seasons," he added, "we tend to divert patients to other hospitals. There's no way we can realistically plan for this."