To Critics, Building Irvine Medical Center Was Unhealthy Move

Well, it is white but, to be fair, it’s probably too early to call the Irvine Medical Center a white elephant.

Not that some people aren’t quite willing to call it that, as they consider the 175-bed complex at Alton Parkway and Sand Canyon Avenue in Irvine.

But the 3-year-old hospital does have doctors and patients, although many beds remain empty. And although the for-profit hospital run by health-care giant American Medical International hasn’t yet turned a profit, its officials have said it’s stopped losing money.

None of that would separate IMC from lots of other hospitals in Orange County, except for the hospital’s colorful and controversial 20-year history and a group of opponents eager to say, “We told you so.”

If IMC ultimately fails, it will stand as a monument to misguided regional health-care planning. There were plenty of people around during the middle 1980s, when plans for the hospital hit full stride, who said it wasn’t needed.

But Irvine (translation: Irvine Co.) convinced the state that the growing city needed its own hospital, although hospitals in adjacent communities were underutilized even then. By the time the hospital finally opened in 1990, the health-care industry was in the midst of a big shakeout that goes on today.

Why didn’t planners see the looming problems when IMC was in the blueprint stage? “There was a big split in the industry then,” according to David Langness, a spokesman for the Hospital Council of Southern California, which is a hospital trade association. “The futurists were saying the sky was going to fall, and the traditionalists were saying no, this is going to be the golden age of health care.”

In the early 1980s, hospitals were such revenue producers, Langness said, that the industry joke was that “all hospital administrators had to do was keep the grass green.” Between 1982 and 1992, however, the percentage of hospitals that made a profit shrunk from 80% to about 42%, he said.

In Orange County--where hospital population has shrunk more than in most other places in California--the January, 1992, to January, 1993, comparison showed the occupancy rate dropping from 56% to 42%, Langness said.

The increasing presence of managed health-care plans, the rise of outpatient therapies and the large number of uninsured people all have contributed to hospitals’ woes, he said. In addition, people in California simply may be healthier these days, he said.

Mary Ann Gaido, a longtime Irvine resident, was a councilwoman from 1976 to 1984. She opposed IMC and thinks it may have been a factor in her defeat in 1984. “I took the stance that additional hospital beds just add to the cost of health care for everyone. Hospitals provide care to a community, and the community is larger than a neighborhood. Orange County, defined as a community, had enough hospital capacity to take care of the patients that required hospitalization.”

There was no bigger IMC opponent, however, than Dr. Stanley van den Noort, then dean of the UCI Medical School and staunch supporter of a campus hospital. In 1987, van den Noort told The Times: “The probability of a successful community hospital in that area is very poor. Anybody would be stupid to put a hospital there.”

I asked van den Noort this week if it’s too early to gloat. To the contrary, he was happy to, saying of IMC’s faltering start: “I’m delighted. I knew it was not going to be a very good place, and they got what they deserved.”

Van den Noort, involved in enough intrigue between UCI and the Irvine Co. to make up a dozen John Grisham novels, is convinced the university could have had its “teaching” hospital on campus if the administration had not abandoned the fight. He still holds out hope that UCI may someday get a campus hospital.

Is he still angry? “I wouldn’t say anger,” van den Noort said. “I’d say the university chose peace over virtue, and that the people of Orange County settled for less than they deserved.”

Former Irvine Councilman David Baker was on the other side; in fact, he hitched his political star to building IMC. “I think in terms of cash flowing, it wasn’t going to be for somewhere from three to five years,” Baker said this week. “Obviously, with Mrs. Clinton’s program and desire for health-care reform, nobody knows where it’s going.”

Baker has no second thoughts about his support. Besides, he said, resolving the controversy with UCI had the long-term benefit of improving the university’s ties with the city of Irvine and the Irvine Co.

John Gaffney, IMC’s first president and now a business consultant, says it’s “way too early” to write off IMC. Irvine’s population and projected growth should be more than enough to sustain a hospital like IMC, he said, noting that new hospitals often take time to establish themselves.

But when I asked Gaffney if he had second thoughts, he said: “With the health-care environment changes that have occurred over the last three to four years, if the question were raised today--should we build it--the answer probably would be no; or if we did, build a different kind of hospital. But at the time, I think it was the right decision.”

Dana Parsons’ column appears Wednesday, Friday and Sunday. Readers may reach Parsons by writing to him at The Times Orange County Edition, 1375 Sunflower Ave., Costa Mesa, Calif. 92626, or calling (714) 966-7821.