County Refuses to Reject Cap on Indigent Patients

The confrontation between the public and private health care sectors intensified Wednesday as Los Angeles County supervisors refused to reject a cap on the number of indigent patients county hospitals will accept next year, while calling for an investigation into allegations that the state’s largest private hospital chain has cut its spending on charity care.

According to a report prepared by a union, revenues at Catholic Healthcare West--California’s biggest hospital chain--have doubled, while it sent most indigent patients to county hospitals, causing its spending on charity care to plummet. Those allegations, however, were hotly contested by Catholic Healthcare West officials. The supervisors, meanwhile, called for a state health department probe.

At the same time, the board brushed off pleas by private hospitals and union leaders to reject a proposed cap on the number of indigent patients county hospitals will accept next year.

“One of the most important admonitions given to medical providers is first do no harm,” said Anthony Abate, vice president of the Health Care Assn. of Southern California, who noted that 21 local emergency rooms have recently shut down due to costs. “The lateral transfer cap will do harm. . . . The trauma system in Los Angeles will not survive this proposal.”

Dave Bullock of the Service Employees International Union added: “We’re going to have death and devastation.”

Coupled with a consumer group’s controversial report earlier this week that nonprofit hospitals are cutting back charity care, Wednesday’s two events highlight a growing debate in Los Angeles County over who will care for uninsured patients, whose numbers are rising by 50,000 each month and are expected to reach 3 million next year.

Federal and state law names the county as health care provider of last resort, and channels billions of dollars into Los Angeles County’s network of six public hospitals and a bureaucracy larger than that of the U.S. Interior Department.

Yet the county receives no money for treating uninsured patients. At the same time, Medi-Cal patients, for whom the county does receive money, are being lured away by private hospitals hungry for the state dollars that follow them.

That combination is one reason the county’s medical system recently teetered on the brink of bankruptcy and is still faced with a “structural deficit” of about $300 million. To help close that gap in next year’s budget, the county proposes capping transfers of indigent patients to its hospitals.

The plan has sparked a heated effort by private hospitals to persuade supervisors that it would force them to shut down emergency rooms that serve all parts of the county’s population.

Supervisors said they remain open to reconsidering the plan, which was floated by their budget office and would save $5 million. In fact, given the strong economy, officials predict that it may even prove unnecessary if county revenues climb before the budget is finalized in June.

Dr. Fred Dennis, an emergency room physician at Cedars-Sinai Medical Center and vice chairman of the county Emergency Medical Services Commission, warned that emergency room doctors may not accept new contracts if they could be burdened with unknown numbers of indigent patients for whom they will not be reimbursed.

“I’m concerned about the precedent of this proposal,” he said.

But supervisors’ ire at the private sector was raised by the report on Catholic Healthcare West’s allegedly poor indigent care. The report was compiled by the Service Employees International Union, which is engaged in a contentious drive to unionize 6,500 Catholic Healthcare West hospital workers.

The report found that the revenues of Catholic Healthcare West, a tax-exempt, nonprofit chain, have doubled since 1992, a period in which the chain spent less than 1% of its money on charity care, less than the national average.

In the last three years, Catholic Healthcare West’s three L.A. hospitals transferred 3,400 uninsured patients to county hospitals while treating only 20, the report said.

“Catholic Healthcare West’s appalling lack of charity care and increasing number of transfers is an example of why we can’t trust private hospitals to share responsibility for the real and escalating public health crisis in Los Angeles,” said Annelle Grajeda of SEIU Local 660, which represents county health workers.

Beth O’Brien, Catholic Healthcare West’s president, said the chain has lost money the last two years yet “maintained its commitment to meeting the health care needs of the poor and underserved,” partly by giving millions of dollars to community groups. She said the union’s report “is designed to mislead the public.”

A spokeswoman for Catholic Healthcare West added that the union’s figures on emergency room admissions and patient transfers were incorrect, saying the chain’s Los Angeles hospitals only transferred 1% of their emergency room patients to county hospitals last year.