Drive to Block County Clinic Tops $1 Million

Community Memorial Hospital has spent more than $1 million so far on its attempt to crush the county hospital’s plans for a new outpatient clinic, more than three times what the nonprofit hospital spends annually on care for the poor.

Community Memorial, which must provide charity care to justify its nonprofit status and the tax break it brings, spent less than $300,000 on indigent care in 1994-95, according to state records.

In return, the hospital receives about $2.5 million annually in tax breaks to provide charity care.

The escalating hospital fight has also forced the Ventura County Medical Center to spend more than $700,000 on attorney fees to defend itself, with those costs expected to rise, officials said.

“It’s sad to see that so much money has been wasted,” said Pierre Durand, director of the county Health Care Agency. “We could all be spending more on patient care.”

Donald Benton, a member of Community Memorial’s board of trustees, said he regretted that so much money has been spent, but that his hospital has no choice. Benton said the hospital believes the county will use the tax-supported, $51-million outpatient clinic to lure away its private patients.

“We are fighting for the survival of the hospital,” Benton said. “We’re not trying to tell the county what to do. We’re saying that the county should not take revenues away from the private sector.”

Durand said the county is not competing for private patients. He said the vast majority of people who visit county clinics either receive Medi-Cal--government insurance for the poor--or have no insurance at all. In both instances, he said, the county is responsible for providing care for these patients.

“All of our statistics show that we have no private patients in our clinics,” he said.

The bulk of the county hospital’s annual $100-million budget is spent providing care for the poor and the uninsured, he said. Community Memorial, in contrast, spends less than 1% of its budget on low-income health care.

Benton said the private hospital can only provide care to indigent patients when they arrive at the emergency room or are referred by doctors affiliated with the hospital. It does not have its own staff of doctors, as the county medical center does.

Benton argued that the county is competing for private patients by offering low-cost insurance coverage for county government employees, who might otherwise be referred to Community Memorial.

Durand said it only makes sense to offer county employees health coverage because the county operates its own health-care system.

Community Memorial spent more than $516,000 to put a countywide referendum on the medical center’s walk-in clinic on the March 26 ballot, according to campaign finance records. The referendum seeks to overturn the supervisors’ decision to issue $51 million in bond-like certificates to pay for the project.

But those costs do not include legal fees from an unsuccessful lawsuit that Community Memorial filed against the county two years ago.

Michael Bakst, executive director of Community Memorial, has said in the past that his hospital has spent more than $700,000 on the failed lawsuit, which is now on appeal. Bakst did not return phone calls Wednesday.

This would bring Community Memorial’s legal and campaign expenses to more than $1.2 million so far. And Benton said the hospital is prepared to spend more if necessary.

“The [board of trustees] recognized when we started this that it was going to be expensive,” he said. “We still felt obligated to go ahead. . . . We are committed to following up on the lawsuit.”

For its part, the Ventura County Medical Center has spent more than $700,000 on attorney fees battling Community Memorial in court.

But this money only represents what has been spent for outside attorneys and expert witnesses to assist the county in the case, and does not include in-house costs, County Counsel James McBride said.

Legal fees, however, are only part of the losses that the county may have to absorb. If Community Memorial’s referendum on the outpatient clinic is successful, the county stands to lose another $2.5 million.

That is the amount the medical center has already invested on architectural plans and designs for the outpatient clinic, Durand said. The work was done in order to apply for $35 million in state grants to help cover construction costs. The rest of the borrowed $51 million would go to pay for the debt service on the project.

Durand said the new building would consolidate five specialty clinics now housed in leased building and would save $1 million a year on rent.

Benton and other Community Memorial officials warned that county taxpayers could end up footing the entire bill for the project if the federal government cuts back funding given to states for health care.

County officials maintain there is little chance, if any, that it will not receive the grant money, noting that several public hospital projects across the state are being financed the same way.

Durand said if the county does not get the money, then the state will simply give it to another jurisdiction.

“In essence, we stand to lose $35 million,” he said.

With the election just weeks away, campaign supporters for both hospitals are stepping up their efforts to reach the public.

Taxpayers for Quality Health Care, a group sponsored by Community Memorial, recently sent out thousands of mailers with absentee ballot applications. The mailers urged voters to vote no on Measure X, as the countywide referendum is known.

So far, Community Memorial has contributed more than $125,000 to this campaign.

To counter this effort, another group that calls itself SMART--or Saving Money as Responsible Taxpayers--has launched its own campaign to support the county project. This group, which has received $15,000 in campaign contributions from county doctors, this week began sending out mailers asking voters to support Measure X.

Meanwhile, Supervisor John K. Flynn said the Board of Supervisors will hold an informational session on the ballot measure at its meeting Tuesday, beginning at 1:30 p.m. Flynn said the purpose of the meeting is to iron out the facts for voters, who he said are confused by the measure.

At the suggestion of Supervisor Susan K. Lacey, Flynn said officials plan to hold similar meetings around the county over the next few weeks. He said details for those meetings will be discussed Tuesday.