County Prepares to Close Hospital

San Luis Obispo County has decided to begin proceedings to close the 123-year-old county hospital.

The fate of the hospital has been one of the longest-running civic debates in this area, which, despite its reputation as a retirement-cum-wine tasting mecca, has many poor people in need of care.

The county Board of Supervisors voted 4 to 1 last week to hold hearings on the closure, the latest and most dramatic action in a two decades-old debate over the best way to provide medical care for the poor and uninsured.

Without the public hospital, the poorest patients could receive care at local private hospitals, but no one knows what will happen to the working poor who lack health insurance but don’t qualify for government assistance.

The county initiated a cost-cutting effort several years ago that included laying off doctors to keep the hospital afloat. Not only did the actions anger medical providers in town, they also did not hold down costs.

“The turnaround plan failed for any one of a number of reasons,” said county Supervisor Shirley Bianchi, a longtime supporter of the public hospital. She cast the lone vote against holding hearings on the closure.

Bianchi said she is still searching for alternatives to shutting down the hospital. “I’m hoping that before that happens, that things will improve so we don’t need to proceed.”

The hospital has had narrow escapes before. In 1999, the county was considering closing the hospital. At that time, however, an election brought two new members to the Board of Supervisors and the board reversed course, deciding instead on the turnaround plan.

“When we initiated the turnaround plan, things were not quite as desperate,” said Bianchi. The plan aimed at shaving losses to $6.5 million a year. Instead, losses have been above $9 million.

More and more counties across the state have closed taxpayer-funded hospitals in recent years, but some observers are surprised that San Luis Obispo County would get into such trouble. Bianchi said the public image of the county as a well-fixed retirement destination that plays host to wine tours is misleading. Not quite a less glittery Napa, Bianchi said, the Central Coast has a substantial number of minimum-wage workers toiling in tourism and agriculture.

“We’re not that well off,” she said. “If you lift up the skirts of this town, you see a lot of problems.”

The county supports not only the 40-bed hospital, but five regional clinics. It is unclear whether the county will ultimately get out of the medical care business altogether or still fund the clinics.

Bianchi opposes closing any facilities. “It’s difficult for me to believe a for-profit hospital will want to deal with the uninsured,” she said. “I do not believe they will be treated with the same amount of care.”

The problem isn’t finding ways to care for the poorest patients. The county has long-term contracts with the four private hospitals to care for them. The issue is providing care to “unsponsored” patients: people who are usually working and make too much to qualify for indigent care, but not enough to afford health insurance.

Currently, any person can walk into the county hospital and receive care. But treating these uninsured patients will require new contracts with private medical providers.

Closing the hospital could take a year or more, officials said.