Change to Managed Care System Criticized : Social services: Doctors say the shift will rob preventive programs to pay for more bureaucracy. Health Department’s director cites state and federal reforms.

The move to managed care in medicine is sending shock waves through the troubled Los Angeles County Health Department, leading to a new outbreak of acerbic exchanges between beleaguered Health Director Robert C. Gates and public health physicians.

The dispute centers around Gates’ efforts to reorganize the massive agency by implementing a large-scale managed care system, patterned after increasingly popular private health maintenance organizations.

Many county doctors contend that the administrative changes will rob the county of resources to treat communicable diseases.

Nationally, as well as locally, managed care is touted as the panacea for health care woes. There are almost as many variations as there are hospitals and health care providers. Proponents of managed care believe that rising medical costs can be controlled by assigning each patient to a primary care provider, who acts as a gatekeeper for other medical services.

The new county system, which is being phased in, will place the county’s six large medical centers and more than 45 health centers in a new county division of personal health services. Under the plan, each hospital and a nearby group of health centers will be organized into clusters.

As patients enter the system, they will be assigned to a primary care physician who will oversee their treatment, authorizing outpatient care at a health center or specialized care at a hospital.

But public health physicians fear that traditional programs such as immunizations and prenatal care will be diluted as they are folded into the broader mix of patient services. They are also upset that Gates’ plan removes the health centers from their traditional place in the public health division and puts them under the control of hospitals chief Walter L. Gray.

The problem, they say, is that the Health Department does not have enough primary care physicians, has botched efforts to develop a computer system for patient tracking and billing, and will have to add at least one new layer of administration to manage the new system.

And because county budget problems make a big infusion of money unlikely, they worry that money to pay for the new system will come from inside the health agency--specifically, from cannibalizing public health programs.

Dr. Shirley Fannin, the county’s director of disease control programs, compared the evolving status of public health physicians to a “poor relative who will eventually be pushed out of the picture entirely.”

Fannin and others believe that with the many public health functions under hospital management, hospitals will receive undue priority at budget time.

“There has never been enough money to provide both good ambulatory care and good public health,” Fannin said. “I don’t know how I and my programs are going to get our work done.” She said she would like to see public health formed into a separate department, as it was many years ago.

The personal health services division, which will include the hospitals and health centers, will account for roughly $1.8 billion of the Health Department’s $2.2-billion annual budget, according to preliminary estimates. The division, which will still be responsible for AIDS, alcohol, tobacco and drug programs, collecting disease control data and other programs, will split the rest of the budget with the departments handling administrative and financial services, and planning and development. About 15% of the county’s full- and part-time physicians, or 210 of the county’s 1,375 doctors, are in public health.

Gates said the overhaul of his agency was driven by the need to meet state and federal health care reform efforts. To resist is unrealistic, he said.

Managed care, Gates said, “is the way the world is going. . . . I think the physicians in public health are not receptive to the changes going on around us.”

The public health physicians warn that thinly supported programs that combat tuberculosis, sexually transmitted diseases and other community health problems could further deteriorate.

Their complaints mark the latest round in a running feud with Gates. Public health physicians say their position has weakened in the past few years through reorganizations that have demoted doctors--particularly those who have criticized Gates--and promotions of administrators who are not physicians.

Fifty physicians, nearly all of them in public health, took the unusual step of signing an open letter to the Board of Supervisors last month complaining that doctors had been excluded from key decisions.

The letter rehashed some of the well-documented problems that have developed under Gates: delay in implementing a tuberculosis control plan and return of $1 million in federal disease control funds; the failure to adequately address the need for immunizations for children under 2, and the failure of a computerization project to modernize records and billing systems.

It went on to criticize Gates’ latest reorganization plan and asked for the reinstatement of Dr. Jonathan B. Weisbuch, the former department medical director who was replaced in the reorganization.

The physicians complained that Weisbuch’s demotion, which followed those of several other top department physicians, represented “a clear pattern of removing senior physicians who raise questions regarding quality of care, access to services and patient satisfaction and well-being.”

“The helm is being directed by non-physicians--that’s the main concern,” said one doctor who signed the letter but asked not to be identified for fear of reprisals. “We have a director who is not a doctor. . . . If you don’t go along with the administration’s ideas, you’re the enemy.”

Gates strongly argues that physicians were involved in planning the reorganization. He also insisted that public health programs would not be slighted. “We have extreme concern about meeting our public health mission. We would not in any way damage that mission,” he said.

So far, the Board of Supervisors, which has often criticized Gates’ management style, supports the health director in the dispute. The supervisors ordered Gates to meet with a delegation of physicians, but they refused to delay the reorganization plan or order the reinstatement of Weisbuch.

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Times staff writer Tracey Kaplan contributed to this story.