L.A. Sinks Into ‘Chernobyl of Health Care’

As the nation debates patients’ rights and prescription drug benefits, Los Angeles County is struggling on a more basic level to keep its health care system from melting down.

The county’s 13-hospital trauma network was just pulled back from the brink of collapse. Its Department of Health Services, solvent only because of two massive federal bailouts since 1995, is looking at a $506-million deficit in five years.

The private sector is suffering its own share of turmoil: Physician groups are merging and going under; community hospitals are fighting mightily to survive. Even a world-renowned medical center--UCLA’s--this year found itself barely in the black.

Registered nurses are in critically low supply, labor strife is on the rise and--with vaccinations delayed--this year’s flu could flood already brimming emergency rooms with patients.

“Los Angeles County is the Chernobyl of health care,” said Dr. Brian Johnston, an emergency room physician and member of the Los Angeles County Medical Assn. board.

Many other parts of the nation face similar, although less serious problems, but “on a whole bunch of fronts, Los Angeles County represents the extremes of the problems that other places are facing” or will face later, said Larry Levitt of the Kaiser Family Foundation, a California-based health policy group.

The financial pressures on the medical system in this county are more fierce than almost anywhere else in the nation. That is largely because nearly a third of non-elderly residents here lack any sort of health insurance and nearly half receive treatment in an exceptionally competitive and volatile HMO marketplace.

The volatility was underscored this week, as Anaheim-based KPC Medical Management, a physician management group in charge of 252,000 patients across Southern California announced that it was closing for financial reasons.

The economic pressures on health care are compounded by the region’s sheer size, its vast income gaps and its huge immigrant population facing cultural and linguistic barriers to care.

Although outrage is building among many physicians and nurses, patients often remain insulated from the problems of the local health care economy--that is, until they or their family members become seriously ill. Then, insured or not, many face painful experiences and daunting choices. Consider:

* A minimum-wage home-care aide, out of kindness, provides more hours of care to an 88-year-old diabetic patient than she is paid for. But she gets no health insurance through her job. When her young daughter developed pneumonia as a result of chickenpox, she steered clear of the emergency room against doctors’ orders. Though terrified for her daughter, she was even more afraid to get a bill she couldn’t pay.

“[Our clients] have somebody to care for them,” said the aide, Amanda Figueroa, 40, of Huntington Park, who, with her husband, supports a family of five on $14,000 a year. “But nobody cares for us.”

* A young mother of two, who has repeatedly gone to an emergency room suffering acute gallbladder pain, can’t get the organ immediately removed because a rise in premiums forced her working husband to drop the family’s HMO coverage. At the county hospital, doctors say, the South Gate woman could wait as long as a year for such surgery.

“It’s worse than having a baby,” said Katrina Pena, describing her pain from a gurney at St. Francis Medical Center in Lynwood.

* A 73-year-old Panorama City woman, diagnosed in 1998 with lung cancer, was told by her HMO doctor that she had six months to live and that nothing could be done. Desperate for treatment, she sought chemotherapy from a physician outside the plan and lived to fight another battle against the HMO--which is refusing to pay the $25,000 tab for outside care because it wasn’t authorized.

* A La Canada Flintridge couple--he a former corporate vice president and she a proofreader--both have had cancer. Though each has insurance, the husband said it is a full-time job to press for the tests and attention they need.

“You find your primary care doctors are so overworked, they could care less who you are. [You’re] another body,” said the 57-year-old husband, Robert J. Ingram.

“It takes a while before you actually get to make a relationship with the doctor and look at him or her in the eye and say, ‘For gosh sakes, this is my life.’ ”

Physicians say they are squeezed between employers and health plans that push to keep costs down and patients who demand or require expensive treatment.

Dr. Brian Greenberg, a Tarzana pediatrician and allergist, often resolves the conflict by providing costly but necessary services and tests for free.

“A lot of stuff that I will do, [health plans] will never, ever have to pay for,” he said.

When he does get paid, it can be as little as $9 per child each month--compensation that he fears may discourage doctors from going the “extra yard” for patients.

Hospitals are starving for dollars as well. Largely because of shrunken payments from government programs and managed care plans, more than 60% of California hospitals are losing money on patient care.

“I think the industry is very close to a precipice,” said Arnold R. Schaffer, president of Glendale Memorial Hospital and Health Center.

Schaffer compares his job to that of an “Ed Sullivan Show” performer, struggling to keep a dozen plates spinning on sticks all at once. Among his worries: the rising costs of labor and uninsured patients, the shortage of nurses and critical care beds, the dearth of doctors willing to take emergency calls and upcoming state deadlines for highly expensive earthquake retrofitting.

Los Angeles County, of course, cannot be considered in isolation. It is part of a state where the government and employers have shown an exceptional reluctance to pour more money into the health system.

Health plan premiums in California--though recently on the rise--are about 10% below the national average, according to the Kaiser Family Foundation.

In the public sector, the state’s spending on impoverished residents who receive Medi-Cal benefits--though recently raised for physician visits--is among the lowest nationally. And the state has failed to make use of hundreds of millions in federal dollars to expand insurance coverage to children of the working poor.

In addition, California grapples, like every other state, with nationwide clampdowns on health care costs--perhaps most dramatically illustrated by the federal Balanced Budget Act of 1997, which cut Medicare payments to hospitals and doctors by billions of dollars.

“It all comes down to no money flowing in,” said Dr. Marie Kuffner, president of the California Medical Assn. “It’s as though the water is so low, all the rocks are sticking out. There’s nothing to float on.”

Los Angeles County might be considered among the rockiest ground.

The county’s staggering 32% uninsured rate--representing 2.7 million people--may signal where the rest of the country is headed, says Kaiser’s Levitt. The number of uninsured people nationally has dipped recently to about 43 million--or 15.5%--but could climb rapidly again in a recession.

Nowhere perhaps are the pressures more obvious than within Los Angeles County’s public health system--the network of hospitals and clinics that serve the poorest residents.

The emergency room at the county’s largest medical center, County-USC, is regularly overwhelmed by a mixture of urgently ill or injured patients and those who might have been easily treated earlier in doctors’ offices--if only they could afford doctors.

Patients at the Boyle Heights hospital can wait 24 hours, even 36 hours, for beds, doctors said. The emergency room becomes a makeshift intensive care unit, without the requisite staffing, because there frequently aren’t enough beds or nurses upstairs.

Doctors find the situation particularly galling in a state with a $10-billion budget surplus.

“I just don’t understand it,” said Dr. Ed Newton, a soft-spoken attending physician. “I keep expecting it to improve with the economy. When the economy is flush . . . how come we can’t have nurses here? That makes me angry.”

On a recent Friday night, described as “quiet” by staff, a dozen untreated patients lay on gurneys outside the trauma booth where surgeons and nurses struggled to treat a wave of patients wounded in gunfights, stabbings or car accidents.

At 2:40 a.m., the son of one elderly man suffering complications from prostate surgery the previous day began screaming at nurses for attention.

“He’s been here six hours! That’s not right!” the son yelled as the attending surgeon, Dr. Stuart Swadron, rushed to calm him.

“That’s what happens sometimes,” Swadron said later, under his breath, striding briskly to attend to other patients. He passed an alcoholic man on a gurney who begged--”Please Doctor!” for some Librium to help him stop shaking.

“This is so difficult!” the doctor said. “[This man is] a human being. He deserves to be seen like anyone else. It’s the ultimate juggling act here.”

Swadron’s next case was a 34-year-old woman--uninsured, with life-threatening complications from diabetes. She was barely conscious.

“This lady here has been suffering symptoms for months and months,” he said. “This shouldn’t have gotten this far. If she had [insurance] it wouldn’t have. . . . Poor thing.”

The county, of course, does not deliberately funnel impoverished patients into its emergency rooms in the middle of the night. But critics say officials have repeatedly missed opportunities to reform the system so it is more efficient and humane.

The county health department is afloat only because of two bailouts from the federal government totaling more $2 billion--money that will dry up by 2005. That will leave a gaping deficit similar to the one that nearly dragged the county into bankruptcy in 1995.

Yet county supervisors recently postponed any decision on cutbacks and voted instead to pump $86 million into politically popular medical programs.

The county certainly has made strides on one money-saving measure: boosting outpatient clinic visits. Even so, progress is limited because some of the private clinics the county contracts with are struggling to meet demand.

The South-Central Family Health Center has been deluged with indigent patients who wait as long as four hours to be seen on a given day.

The clientele--overwhelmingly immigrant Latino families--has clearly outgrown the building. So has the staff, which works in offices the size of closets and must keep alert to avoid hallway collisions.

“There could be three or four more of these doing exactly the same thing, [at] the same volume, and they would be overrun with demand,” said Dr. Paul T. Giboney, a physician who works there. “This community is very underserved.”

Few believe that state or federal politicians would allow the county health system to fail, but critics say limited resources doom the county to lurch from crisis to crisis. As physician Johnston put it: “We have entrusted the health care of the poorest people to the poorest branch of government.”

Problems in the public sector have bled into the private sector. Witness the recent “trauma crisis,” in which several struggling private hospitals--saying they were underpaid for indigent care--threatened to pull out of the fragile network.

The county’s solution was a one-year, stop-gap allocation of $8.5 million to buy time to convince the state to provide more long-term support. Prospects for that, critics say, are slim.

Meanwhile, private hospitals and physicians are besieged with problems of their own. With money so tight, battles have broken out everywhere over who should pay for what, and how much.

Medicine “is not the warm, fuzzy [environment] that it used to be,” said Dr. Don Gaspard, medical director of the trauma service at Huntington Memorial Hospital in Pasadena. “Everybody’s at war.”

Hospital nurses are increasingly channeling their anger into support for unions. They say they are less concerned with pay and benefits than with stressful working conditions, understaffing and fear for patients’ welfare. Some say they are caring for as many as 12 patients at once.

For all the turbulence in the hospital industry, the collapse of doctors groups has created at least as much acrimony and disarray.

Scores of groups in California that coordinate physician services to managed-care patients have gone bankrupt or closed in the last four years. Under California’s somewhat idiosyncratic system, these groups act as middlemen between health plans and doctors, paying for all aspects of patient care out of set fees from health plans.

Doctors complain that paltry, delayed or withheld fees have led to financial instability among these physician groups. That instability has threatened to disrupt care to hundreds of thousands of patients.

The most extreme example is the closure of the Anaheim-based KPC Medical Management, the largest for-profit medical group in Southern California.

The turmoil has resulted in a verbal free-for-all over the minuses of managed care in this state. And Los Angeles County, with so many of its residents enrolled in HMOs, is at the center of the storm.

Walter Zelman, president of the California Assn. of Health Plans, an HMO trade group, counters that while large organizations structured like KPC have failed, the overall problem of collapsing physician groups has been exaggerated.

He says, as well, that managed care has kept premiums lower in California--and Los Angeles County--than almost anywhere else, while offering among the highest quality of care anywhere.

But patients and their families have trouble appreciating lower costs if they perceive that health plans or doctors are skimping on care.

“It’s all to save money,” said Elsa Cabrera, daughter of the 73-year-old woman who went outside her HMO to get chemotherapy. “They don’t care about the people.”

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The Insurance Picture

Statistics for the population through age 64:, Los Angeles Times