Supervisors Vote to Accept Suit Settlement

The Los Angeles County Board of Supervisors voted Tuesday to settle a lawsuit it filed against the state over disputed Medi-Cal billings. The county will receive $10.5 million that health officials say will be used to expand medical services.

Approval of the settlement ended a protracted legal battle that began in 1994, when the county was told that the state health department would not reimburse it for treatment of Medi-Cal patients at the Rancho Los Amigos Medical Center in Downey because their bills had been submitted after the one-year state deadline.

The county blamed the billing delays on a problem-plagued hospital information system known as IBAX that was in use at Rancho, and said the problems were beyond its control. State health officials rejected that contention.

Although the state formally denied Medi-Cal payments of $10.3 million, the county later determined it had lost a total of at least $26.6 million for care provided to the poor between 1990 and 1993. It sought reimbursement from the state for the entire amount, but was only given $1.3 million, prompting the lawsuit to recover the rest of the money.

County lawyers urged the board to approve the settlement, saying it would be hard to come up with a legally compelling justification for the late submission of bills.