County to Eliminate a Third of Hospital Beds to Get U.S. Bailout

Los Angeles County officials disclosed Monday that as part of the massive restructuring of their health system required to get a $364-million bailout from the federal government, they plan to eliminate one-third of the county’s 2,600 inpatient hospital beds.

Although the shift from costly inpatient services to more basic, preventive outpatient care has been part of the deal since President Clinton first announced the proposed aid package in September, county officials said the news underscored their commitment to radically changing the nation’s second-largest public health care system over the next five years.

“The county is going to reduce its staffed beds by one third. That is a dramatic number,” said one county official involved in the negotiations over the bailout. “And we are characterizing it to the Feds as a minimum number; we’ll do better if we can. We are much too heavily weighted toward hospital care.”

County officials had little comment Monday, saying the proposed elimination of hospital beds will be discussed in detail at today’s scheduled Board of Supervisors’ meeting.

The county official, who asked for anonymity due to the negotiations, said reducing the number of hospital beds is designed to send a message to several important participants in the debate over the future of Los Angeles County’s health care system.

“This is a way of expressing to the private sector [hospitals] that there is more that they can do to help us,” the official said, “and to show the federal government that we are trying to significantly transform the system.”

The county official said the proposal was formally unveiled for review by federal officials last month, after the federal Health Care Financing Administration said it needed more detail about how the county planned to restructure its health system before committing to granting the complicated bailout request.

On Saturday, The Times reported that the bailout effort has not been finalized, in part because federal officials believe that the county has not provided enough detail on how it plans to restructure its mammoth health department.

On Monday, Supervisor Zev Yaroslavsky said the proposed elimination of one-third of the hospital beds now being used is just one example of how seriously the county is taking the federal government’s insistence that it reform its system.

The downsizing could affect the county’s ability to handle the flood of poor and indigent patients that come to the hospitals, nearly all of them through emergency rooms.

But the one-third figure cited by county officials includes at least 300 beds already eliminated since last summer, when the supervisors approved $150-million in cuts in inpatient services. About 370 more of the estimated 800 beds slated for elimination will count when two county hospitals, Rancho Los Amigos Medical Center and High Desert Hospital, are privatized in the next few years as part of the restructuring effort, health officials said.

The proposal also takes into consideration a proposed downsizing of County-USC Medical Center when it is rebuilt because of earthquake damage. Other beds would be eliminated from within the entire hospital system, county officials said.

Jim Lott, spokesman for the Healthcare Assn. of Southern California that represents most of the region’s largest hospitals, said that the announcement, “while it sounds positive, is news to us and we haven’t been talked to about any of the details. It becomes really critical where the one-third comes from.”

Lott said that the elimination of several hundred hospital beds, combined with the privatization of the two hospitals, would probably be manageable for those private hospitals that would end up treating any overflow patients.

Times staff writer Jeffrey L. Rabin contributed to this story.