County’s Health Reform Proposal Delivered to U.S.

Los Angeles County on Friday formally delivered to the federal government a bare-bones plan for restructuring its public health system that promises change and demands massive financial help from Washington.

The plan contains broad goals, including a 50% increase in access to outpatient care and the reduction in the number of hospital beds by one-third, but it is unclear if the document includes enough details to satisfy federal officials who rejected a draft proposal several months ago as too vague.

Three members of the Board of Supervisors will be in the nation’s capital Monday to mount a lobbying blitz to break loose $364 million promised by President Clinton in September, and to secure even more federal money to finance the plan.

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After insisting for months that the county’s effort to secure a waiver of Medicaid rules was on track, county officials grudgingly acknowledged Friday that there remain significant differences between them and the federal officials who control the health care dollars the county needs.

Faced with critical budget decisions in coming months that could once again threaten to shut down county hospitals, the three Democratic supervisors are taking their demands to the highest levels of the federal government.

“This is life and death,” said Supervisor Yvonne Brathwaite Burke. “Obviously we have to get past June 30, and we need to know how much [federal money] we can include in our budget. That is why we are going back there.”

Burke made clear that the supervisors and a large delegation of county officials want to override the federal health care bureaucrats who have raised numerous concerns about the county’s commitment to overhauling its $2.3-billion-a-year health system, the nation’s second largest.

The Times reported a week ago that some Clinton administration officials are concerned that the county is seeking more money for future years without delivering a comprehensive blueprint on how to transform the hospital-heavy system into one that emphasizes less costly community-based outpatient care.

“We want to make sure that the higher-ups, the policymakers, say to [the health care bureaucrats] what our timetable is,” Burke said. “You are talking about some big dollars and some unprecedented policy decisions.”

The nearly 300-page proposal--technically an application for a waiver of federal Medicaid rules--offers a broad vision of a health system that moves from a reliance on expensive hospital care to preventive care at walk-in clinics and larger comprehensive health centers.

Rather than details, the document contains goals and timelines--sought by federal officials--on when the county will provide the nuts and bolts of how it plans to remake the vast health system for millions of county residents over a five-year period.

The document depicts in grim detail an explosion in the number of county residents who are poor or lack health insurance. That number now stands at 4.4 million, many of whom rely on the county for health care. “Most of the uninsured are low-income working people and their families,” according to the document.

The plan involves reducing the number of hospital beds in the county system by at least one-third, from 2,595 last year to 1,719, by the turn of the century. This would be accomplished by privatizing High Desert Hospital in the Antelope Valley and Rancho Los Amigos Medical Center in Downey, and continuing to reduce the number of beds at the county’s four major hospitals.

The county commits to a 50% increase over the same period in access to outpatient primary care services, but precisely how and where is unclear.

The health department would provide extended evening and weekend hours and shorter waiting times at its clinics, create a 24-hour telephone hotline to nurses for medical advice, provide services in many languages and improve its antiquated and uncoordinated computer systems that making tracking patients, medical records and test results nearly impossible.

The county also pledges to work with its medical school partners at USC, UCLA and Drew University to shift the emphasis from training specialists to training more primary care doctors.

The plan is structured in two phases. The first involves infusing the county system with $364 million promised by the president last fall to avert a catastrophic collapse of the health care safety net.

Clinton’s commitment, televised live in a vote-rich region crucial to his reelection hopes, averted the threatened closure of the nation’s busiest public hospital, County-USC Medical Center, and most of the county’s community clinics.

But even with the federal money, the county still faces a deficit of up to $168 million in its health care system in the next fiscal year, which begins July 1.

Embedded in the document is the crux of the county’s disagreement with federal officials. “The long-term vision of a coordinated system of comprehensive care with an emphasis on prevention and primary care can only be realized by solving the severe structural and financial problems that precipitated the current crisis,” the document states.

It is not clear how federal officials will react to the plan, but county officials expressed confidence Friday that it does provide the appropriate level of detail needed to gain approval of the waiver.

Burt Margolin, the county’s former health czar and now its legislative strategist, acknowledged that officials of the federal Health Care Financing Administration are balking at the county’s long-term restructuring proposals because they would commit the federal government to provide more money than the officials want to spend.

It is not a new issue. In documents obtained Friday under the California Public Records Act, the federal agency warned in recent months that the earlier draft of the county’s waiver was inconsistent with the September agreement that Clinton announced.

Federal officials wanted “a sound, rational and achievable plan” for changing the current health system. “The working draft instead presents a plan only to create a process for restructuring rather than a concrete proposal for restructuring.”

The draft also lacked public participation from those who depend on the county for health care, the federal officials said. And they reminded county officials that while the federal government could assist in the early stages, Washington expects to see county health costs reduced by the end of the five-year period through more efficient services.

Margolin said that county, state and federal officials know they have differences to resolve but that it was time to send the final waiver application to Washington.

“We are not doing it in a hostile way. We are trying to be cooperative,” Margolin said. “We submitted it so we can get the $364 million and so we can have a public framework in which to resolve our differences.”

Supervisors Zev Yaroslavsky and Gloria Molina, who pressed the Clinton administration last fall when the county was facing the prospect of a health system collapse, are returning to the White House to renew their call for urgent action.

“The waiver is a five-year waiver. It is crucial that when the waiver is approved we have the flexibility and resources to make it work,” Yaroslavsky said.

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Documents obtained under the public records act indicate that while county officials for months were saying the waiver was on track, significant issues had yet to be resolved. Local, state and federal officials held a summit meeting at in Washington on Jan. 18 and 19.

Much of the enormously complicated discussion--and disagreement--focuses on something fairly simple: how to continue to provide Los Angeles County with funds in future years to make the transition from an inpatient to an outpatient system, without setting an expensive precedent that other major urban areas would soon demand.