Catholic Chain Top Finalist to Operate County Hospital

A large Roman Catholic hospital chain has emerged as the leading contender to take over Rancho Los Amigos Medical Center, the county’s renowned public orthopedic hospital, it was learned Thursday.

Catholic Healthcare West, a 35-hospital chain, is said to have the inside track in ongoing negotiations to privatize the hospital, although county negotiators will continue talking with two other health care organizations.

The three finalists emerged from a field of 12 major hospital chains and health maintenance organizations that had expressed interest in taking over--but not buying--Rancho when the county announced that it wanted to sell the facility.

“Catholic Healthcare West seems to have the strength that the other two don’t,” said Armando Lopez, the regional administrator in charge of Rancho for the county Department of Health Services, confirming reports that a county advisory group favors the chain.

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The other finalists are Daniel Freeman Hospitals, which is bidding in partnership with the USC Schools of Medicine, Dentistry and Gerontology, and S.K. Ching & Associates, a private partnership that manages health facilities.

Rancho, which is the only orthopedic facility for the indigent in Los Angeles County, is the first county hospital to be put on the block by the cash-strapped county. A second county facility, High Desert Hospital in Lancaster, will go on the block soon.

Details of the Catholic Healthcare West bid were not released, but the California-based chain did not offer to buy the medical center in Downey.

Advised in its negotiations with the county by Conway Collis, a former member of the State Board of Equalization, the hospital chain offered the county an operating agreement with a minimum 10-year lease and promised to continue to treat the poor.

The privatization of Rancho is being watched closely because of its prominence among rehabilitation hospitals and its role as the only provider of ongoing medical services to indigent patients who have suffered permanent or partial paralysis.

The Downey hospital is where patients are sent after they suffer traumatic injuries to relearn such simple tasks as how to get out of bed. It is the only California hospital, public or private, that regularly is listed among the nation’s best orthopedic hospitals in prestigious surveys of experts published by U.S. News & World Report.

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Rancho came into prominence in the mid-1950s as a polio treatment center. Although new polio cases are relatively rare now, the hospital continues to treat polio patients as they age. The hospital also keeps its beds full and outpatient clinics busy with victims of gunshot wounds and with patients who suffered disabling injuries in industrial and traffic accidents.

Privatizing Rancho was one of the recommendations that came out of the health crisis task force appointed by the Board of Supervisors last year to come up with solutions to an unprecedented budget crisis.

A crown jewel in the six-hospital county health care system, advisors thought that it would be an attractive candidate for purchase by a private hospital chain or health maintenance organization.

But none of the 12 large health care providers who expressed interest initially in taking over the medical center offered to buy it, leaving county health administrators disappointed. Most of the 12 providers decided not to pursue bids.