2 N. County Hospitals to Quit Medi-Cal : Health care: Officials predict ‘chaos’ for the system’s patients and the few remaining area facilities that accept them.

Two North County hospitals will quit the state Medi-Cal system effective Friday, their executives said, and they predicted “chaos” for Medi-Cal patients and the few remaining area hospitals accepting those patients.

Officials from Martin Luther Hospital in Anaheim and smaller La Palma Intercommunity Hospital said Wednesday that their negotiations with state officials have ended and both facilities are leaving the indigent care system.

Executives at both hospitals said the fast-growing volume of Medi-Cal patients was crowding maternity wards--and crowding out paying patients.

“I think it’s very unfortunate that the state chose not to help us find a way to deal with Medi-Cal patients and spread the volume of patients across the Orange County hospitals like we suggested,” said John Cochran, chief executive of Martin Luther.

He warned that his hospital’s decision to quit Medi-Cal “at best” would cause “major disruptions of patient care, with patients and doctors having to move very suddenly” to other Medi-Cal hospitals. At worst, “some poor lady is going to deliver her baby in the back seat, driving her car from some hospital that doesn’t have a Medi-Cal contract to one that does.”

But Michael Murray, executive director of California Medical Assistance Commission--the state commission that negotiates Medi-Cal contracts--said he believes that other nearby hospitals will probably have room to handle patients previously cared for at La Palma and Martin Luther and the defections may not cause serious problems.

Officials at two other Medi-Cal hospitals also took the news in stride. At AMI Medical Center of Garden Grove, nursing director Jane Schumacher said she believes that her hospital could care for some maternity patients who might otherwise have gone to La Palma and “at this time we don’t have too many concerns.” Paul Viviano, chief executive officer of St. Jude Hospital and Rehabilitation Center in Fullerton, said he still needs to analyze the situation.

The defection of Martin Luther and La Palma will leave only 10 hospitals in Orange County under state contract to provide non-emergency care to indigent patients. But many of the county’s 34 hospitals are located in “open” areas in which hospitals can be reimbursed for treating Medi-Cal patients without a contract.

When Fountain Valley Regional Hospital and Medical Center recently decided not to renew its Medi-Cal contract, the state declared the area of Westminster, Huntington Beach and Fountain Valley to be an “open area.” South County has long operated as an open area.

During his negotiations with the state, Cochran had requested that the Anaheim area be declared open so Medi-Cal patients would be more evenly distributed among area hospitals.

Murray said leaders from Martin Luther and La Palma, which are part of the Uni-Health chain, made unreasonable requests of the state during contract negotiations. These included a demand that his agency provide malpractice coverage for Medi-Cal physicians and cap the number of Medi-Cal patients the hospitals would treat, he said.

Murray said he believes that the proposal to cap Medi-Cal patients might violate federal law.

The remaining Orange County hospitals with Medi-Cal contracts are Buena Park Doctors Hospital, Placentia-Linda Community Hospital, St. Jude’s, Western Medical Center-Anaheim, AMI Medical Center, Santa Ana Hospital Medical Center, Los Alamitos Medical Center, Children’s Hospital of Orange County in Orange, Doctors Hospital of Santa Ana and UCI Medical Center in Orange.