Bid to Sell Hospitals Stirs Fears

The sale or possible closure of 19 Tenet hospitals in California -- the vast majority in Los Angeles County -- could punch a gaping hole in the region’s healthcare system, leaving far fewer facilities to treat a growing population, healthcare officials said Wednesday.

Officials estimate that a third of the 14 hospitals targeted for sale in Los Angeles County will not find buyers and might close, Supervisor Zev Yaroslavsky said.

“Tenet has just lobbed a big, fat grenade into the healthcare system of Los Angeles County,” he said.

The Santa Barbara-based for-profit company, whose motto is “passion, commitment and leadership in healthcare,” announced this week that it would put the hospitals up for sale, saying it could not afford $1.6 billion in seismic retrofitting, a procedure required of all California hospitals in coming years.

Eight hospitals outside the state will be sold as well.

Tenet spokesman Harry Anderson stressed Wednesday that the company didn’t intend to close any of the hospitals.

But many physicians and other healthcare experts say Tenet will have difficulty selling the facilities -- some of them with aging plants and in low-income neighborhoods.

They say the ripple effect of shutdowns or reductions in service will be felt by other hospitals throughout Los Angeles and Orange counties.

“If a hospital is already not profitable or marginally profitable, then who is going to buy it? If nobody buys it, then who is going to provide those services?” asked Dr. Marcy Zwelling- Aamot, president of the Los Angeles County Medical Assn. “If patients are already waiting hours to be seen, should they bring a sleeping bag? Where are they going to go? The system is crashing.”

In Los Angeles County, where the public healthcare and trauma system is especially strapped because of the high number of uninsured residents, remaining hospitals could be inundated with patients whom they lack the staff and facilities to treat, healthcare officials said.

But officials at Orange County hospitals that treat a large number of poor people were worried as well.

“We’re a hospital that’s full about 90% of the time right now,” said Dr. Ralph Cygan, chief executive of UCI Medical Center. “Our emergency room is very busy, and our specialty programs have kept our surgical floors at or near capacity. We’re not in a position to take up a lot of slack here.”

Doctors at non-Tenet hospitals fear that ambulances will have to travel farther to reach emergency rooms and that the uninsured will have a harder time finding care.

In addition, thousands of jobs in low-income neighborhoods could be lost. And millions of dollars in property taxes could vaporize if the hospitals are shut or purchased by nonprofit corporations.

The list of hospitals for sale includes some of the larger facilities in the Southland, such as Western Medical Center in Santa Ana, Queen of Angels/Hollywood Presbyterian Medical Center, Brotman Medical Center in Culver City and the two campuses of Encino-Tarzana Regional Medical Center.

The 19 hospitals employ more than 15,000 people and in some cases are among the largest sources of jobs in their neighborhoods.

A statement from California Atty. Gen. Bill Lockyer said his office would review the proposed sales to ensure that Tenet abided by agreements it made to keep open some of the hospitals as a condition of purchase.

“The bottom line is that Atty. Gen. Lockyer is going to do everything in his power to protect the affordability of healthcare and the access to healthcare in the communities affected by the proposed sales,” spokesman Tom Dresslar said.

At Tenet hospitals across the region, patients worried about losing their local hospitals and employees feared losing their jobs -- although some said they would not miss having Tenet as a boss.

The announcement comes just weeks after three other hospitals in Southern California announced that they would be closing.

Santa Paula Memorial in Ventura County and Santa Teresita in Duarte have shut down as acute care facilities in recent weeks. Century City Hospital, a Tenet property, has announced its intention to close.

The foremost concern healthcare officials have about Tenet’s decision is the potential loss of emergency rooms.

Because of crowding in those that remain open, paramedics often find themselves waiting an hour or more just to drop their patients off at hospitals. While those paramedics wait, other units must cover for them -- often traveling many miles from the areas they are supposed to be covering.

“This is the meltdown,” said Carol Gunter, acting director of the Los Angeles County Emergency Medical Services Agency. “Even the closure of Santa Teresita has had an impact on Arcadia Methodist Hospital.”

Gunter said that although Santa Teresita had a relatively small emergency room -- with just nine bays for treating patients -- its closure has sent an average of 32 more patients to Methodist each day. And that, she said, is more than the Arcadia hospital should have to handle.

“Right now Tenet is saying the hospitals won’t close and they are going to be sold,” she said. “The next question I have is: Do you know who is going to buy them?”

Lark Galloway-Gilliam, executive director of the nonprofit advocacy group Community Health Councils, said Tenet should never have been allowed to buy so many hospitals in the first place.

“This is the problem when you turn healthcare into a for-profit enterprise, and you don’t have regulation,” she said.

Tenet spokesman Anderson said Wednesday that the corporation had already received “a number of calls” from parties interested in buying the hospitals. He declined to name them. He also said a nonprofit group -- which would be exempt from some taxes -- might be better capable of operating the hospitals.

Tenet signed an agreement with the attorney general in 2001 that forbade it from closing two hospitals it was purchasing -- Daniel Freeman Memorial in Inglewood and Daniel Freeman Marina in Marina del Rey -- until 2006. It also must continue operating the emergency room at Daniel Freeman Memorial until 2008.

Although those two hospitals may be protected, the others could be vulnerable. Their fate probably rests in the peculiarities of 21st century hospital economics.

Glenn Melnick, a professor of health economics at USC, said that the hospital business isn’t as bleak as it’s often portrayed -- but that there are certainly imposing obstacles.

One is a law that requires all hospitals in California to be collapse-proof no later than 2013; so far, no hospital has completed both the required construction to meet that standard and the accompanying paperwork.

Another obstacle is a state law that went into effect Jan. 1 requiring most hospitals to hire more nurses. Officials at Santa Teresita blamed that law for their closure.

One of the facilities on the block is Inglewood’s Centinela Hospital Medical Center, which has 370 beds and an emergency room that is usually busy.

That was the case Wednesday afternoon, when patients sat in the waiting area grumbling about the wait. One was Angela Curie, 34, whose doctor had ordered treatment for high blood pressure.

If they close the hospital, she said, “it’s going to be horrible. What do you do with the sick people?” she asked. “There are going to be a lot of dead people or a lot of unemployed people.”

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Times staff writers Sue Fox, Lisa Girion, Jia-Rui Chong and Jennifer Mena contributed to this report.