2 Additional Hospitals to Cut Ties With Medi-Cal

Two more San Fernando Valley hospitals will pull out of Medi-Cal, the state program that provides hospital care for the poor, becoming the third and fourth in the Valley area to withdraw in the past seven months.

Hospital industry executives say they cannot afford to remain in Medi-Cal because the state pays too little of the true cost of hospital care. State health officials say that pullouts are sometimes a negotiating ploy to force the state to pay higher rates, and that adequate coverage can be maintained.

Holy Cross Medical Center in Mission Hills and Granada Hills Community Hospital plan to sever ties with Medi-Cal at the end of June, administrators said.

Northridge Hospital Medical Center and Henry Mayo Newhall Memorial Hospital in Valencia withdrew from the program late last year, saying they could not afford the financial drain.

At least five other hospitals in the Valley still have contracts with Medi-Cal: Olive View, a Los Angeles County hospital; Valley Presbyterian and Valley Hospital in Van Nuys, St. Joseph in Burbank and Pacifica Hospital in Sun Valley.

2 Others Unhappy

However, spokesmen for both Pacifica and Valley Hospital said they are also unhappy with Medi-Cal.

Pacifica is not taking any action to withdraw now because it is in the process of being sold to new owners, but the chances that the hospital will remain in Medi-Cal “are not looking very good,” said Ermanno Mariani, executive director.

“We have about 30 Medi-Cal patients a day, and the state only covers about half of what their services cost,” he said.

Medi-Cal’s payments to Granada Hills Community Hospital are “about $200 a day below the actual cost of providing services,” said Karen Oppliger, director of marketing. The hospital was reimbursed for 2,700 Medi-Cal “patient days” in 1987, she said, “so we’re looking at about a half-million dollars lost.”

About 9% of the hospital’s patients last year were on Medi-Cal, she said. “Our concern is that with the other hospitals in the area abandoning Medi-Cal, we would get a disproportionate share of Medi-Cal patients and that would put an undue financial burden on the hospital.”

Granada Hills is still negotiating with the state Department of Health Services, however, and will continue to do so, she said.

The state pays a flat fee--arrived at in negotiations with the hospital--for each day a Medi-Cal patient is hospitalized, regardless of the services the hospital provides.

“Giving notice that they’re going to quit doesn’t necessarily mean a hospital is out,” said Michael W. Murray, executive director of the California Medical Assistance Commission, which negotiates for the state.

“It can be a strategy a hospital uses in the negotiations, like a group of employees telling their employer they have set a date for a strike vote. I can’t say for certain which this is . . . because I can’t read their minds,” he said of the two hospitals’ plans.

Murray refused to say whether the loss of two more hospitals would have a serious impact on the availability of services for Valley area patients who rely on Medi-Cal.

‘Confidential Negotiations’

“That would expose the state’s weakness or strength in negotiations with the hospitals and change our negotiating picture,” he said. “The negotiations are confidential, and it would weaken the state’s bargaining position if our analysis was made public.”

However, John Rodriguez, deputy director of the state health department, in charge of the Medi-Cal program, said the hospitals could probably be replaced, or their loss may not be important.

If the state did have too few hospital contracts to serve Medi-Cal patients in the area, it could declare the region an open zone, Rodriguez and Murray said. In that case, hospitals would be reimbursed for individual patients. The patients would have to be admitted to the hospitals by doctors willing to take Medi-Cal payments, however.