THE COUNTY BUDGET CRISIS : Supervisors Struggle With Fragile Plan : Health care: Antelope Valley Hospital threatens to void pact as board increases reliance on private providers.


Just hours before the county hammered out a health budget that relies on private-public partnerships to maintain medical services for the poor, a private hospital in the Antelope Valley threatened to break an existing contract, saying that it wanted “better terms,” officials disclosed Wednesday.

An administrator at Antelope Valley Hospital said the facility is willing to continue to provide care for 3,100 poor patients--as it has done for years--but wants to renegotiate its agreement.

Although the current contract may not directly affect future plans to care for the area’s poor, both county and private hospital officials said the dispute was an ominous sign as the county tries to rely more heavily on private partners to deliver health care.

“This is a disconcerting thing to happen, especially at this time,” said Toni Yaffe, an assistant director with the county Department of Health Services. “It does not seem to bode well for private partnerships.”


The demand, which Yaffe and other county health officials said took them by surprise, was revealed as funding plans appeared to unravel just a day after the Board of Supervisors adopted an austere 1995-96 budget aimed at shrinking a $1.2-billion deficit.

Spared from drastic cuts in the approximately $12-billion spending plan was High Desert Hospital, a county-run facility in Lancaster that serves 70,000 patients a year, many of them uninsured and dependent on government-funded medical care. But that was based on the hope that nearby Antelope Valley Hospital would increase its services to the poor in exchange for a still undetermined, per-patient fee.

Under the budget plan, the county and private health-care providers--including Antelope Valley Hospital--had a year from now to negotiate the specific terms of their agreements. But Tuesday afternoon, while the Board of Supervisors was deliberating over the budget, Antelope Valley Hospital faxed a two-paragraph letter indicating that even an existing arrangement to provide medical care was in jeopardy.

“This letter serves as notice that Antelope Valley Hospital is terminating the Hospital and Medical Care Agreement . . . effective Sept. 30, 1995,” the letter said.


County health officials had been counting on the agreement to last at least through Dec. 31 and serve as the basis of a new arrangement to help care for indigent inpatients covered by the county’s health-maintenance organization, known as the Community Health Plan.

Instead, the termination date selected by Antelope Valley Hospital is one day before the county is scheduled to close 29 of its 39 health centers and clinics and reduce hospital outpatient services by 75%.

“I’m sorry if it took this kind of dramatic action to get them to the negotiating table,” said Bev Greer, Antelope Valley Hospital’s vice president in charge of business. “But we’ve been trying to negotiate with them for the past year and a half.” She declined to explain in detail what “better terms” the hospital wants.

But Yaffe maintained that county health officials have been in frequent contact with the private hospital. “This is a complete surprise to us,” she said. “We had no warning.”

The county is increasingly relying on the private sector to ease the burden of caring for the poor and reduce its health-care costs. In Tuesday’s budget, for instance, High Desert was given funding for an additional year so health officials could pursue an agreement with a private subcontractor to handle High Desert’s in-hospital patients. Antelope Valley Hospital was the logical choice because it is the largest hospital in the remote area.

Since the late 1980s, the county has contracted with Antelope Valley Hospital to treat patients covered by the Community Health Plan. Currently, about 3,100 patients who lack medical insurance receive obstetric and emergency care at the private hospital and outpatient care at county-run High Desert Hospital.

Tuesday, the county balanced its budget by anticipating that it would receive millions of dollars in revenue that it has no guarantee of receiving, including increased funding from the state and federal governments. If those funds are not forthcoming the supervisors will have to make further cuts, including possibly closing High Desert.

“We don’t have a lot to bargain with,” said Kathryn Barger, health deputy to Supervisor Mike Antonovich, who represents the area.