California allows hospitals to delay seismic upgrades

Los Angeles Times Staff Writer

With three-quarters of California’s acute-care hospitals at risk of collapsing in a major earthquake, Gov. Arnold Schwarzenegger has approved new rules allowing many facilities to bypass the extremely costly building reinforcements the state ordered after the 1994 Northridge temblor.

Schwarzenegger is permitting some financially struggling hospitals to keep operating until 2020 even though the state says they are most likely to crumple during a major seismic event. The move is a break from the governor’s stated policy that the least-sound buildings should be upgraded first.

Those hospitals will have 12 more years than lawmakers intended when the devastation from the 6.7 magnitude Northridge quake was still fresh. Many of the hospitals that expect to qualify for the exemption, such as St. Vincent Medical Center in downtown Los Angeles, treat large and impoverished urban populations.

The administration also is enacting a new method of assessing a building’s risk of collapse, one that is expected to give many hospitals up to 22 additional years to fortify their buildings. To qualify under these emergency regulations, hospitals must show that even though their buildings haven’t been reinforced, the ground they sit on is sound enough and fault lines are distant enough to make a collapse highly unlikely.

Hospital executives and administration officials say these new rules will ease the financial demands on the industry. The legislation Schwarzenegger signed this fall for impoverished hospitals allows them to skip the first stage of reinforcing and focusing on rebuilding.

“A seismically safe building is no good to anyone if the doors close due to a hospital’s financial inability to replace or retrofit that building,” said Kim Belshe, Schwarzenegger’s secretary of health and human services. “Policymakers have to look at future seismic safety risk against today’s realities of access and financial capacity.”

The deferrals have been aggressively sought by the hospital industry, which is far less ready than the state intended after Northridge. More than 20 facilities sustained so much damage in that quake that they suspended some or all of their services, and lawmakers ordered all hospitals retrofitted to survive a major temblor by 2008.

With that milestone a month away, only 97 of California’s 436 acute-care hospitals meet the law’s standards. State records show that 244 hospitals have not yet begun major construction; 43% are in Greater Los Angeles.

Tough task made tougher

“We are playing with patient and staff lives,” said Donna Gerber, chief lobbyist for the California Nurses Assn., which opposed the deadline delays Schwarzenegger approved this year. “There will be a major seismic event in California, and we know it.”

The numbers underscore California’s increasingly shaky effort to ensure hospital stability.

The industry has consistently maintained that despite a lead time of more than a decade, even prosperous hospitals could not afford the state-required upgrades. And lawmakers, even as they have borrowed billions to fix up schools, roads and levees, have declined to help hospitals finance their seismic reconstruction, choosing instead to postpone the deadlines repeatedly.

The 2008 marker was extended to 2013 for all but 10 hospitals. Lawmakers built in another extension, until 2015, for hospitals that start construction by 2013. But many hospitals have resisted buttressing their buildings because they also face a 2030 deadline to completely reconstruct them. That is required to guarantee that they can endure, and continue operating, during an earthquake.

There is wide acknowledgment that the two-stage sequence has made an already challenging task even harder.

“The seismic standards that are being asked of hospitals are not unreasonable,” said Lucile Jones, a Pasadena-based seismologist with the U.S. Geological Survey and a member of the California Seismic Safety Commission. “I think the flaw in the hospital law was the assumption that retrofitting was a good intermediate stage. In fact, the retrofitting costs so much that it’s not worth it.”

In 2005, 39% of California hospitals operated at a loss, according to a California Health Care Foundation study released this year. But the study found that the industry overall has improved financially every year since 1999. Some hospitals are spending lavishly on refurbished rooms and fancy gardens to attract patients.

Even as it has sought more delays, the industry has been politically generous. Hospitals have given more than $10 million to candidates and ballot-measure campaigns since 2000.

In May, the hospital’s trade group gave the governor’s political account $100,000, records show. Schwarzenegger also needs hospitals’ support for his proposed overhaul of California’s healthcare system.

“He’s not wanted to make” hospital seismic safety “a crowning point of his time as governor,” said Sen. Elaine Alquist (D-San Jose). “It’s a mistake to put off retrofitting. I understand hospitals are financially strapped, but I also believe that hospitals ought to be a safe place to be in an earthquake.”

In no hurry

But even successful hospitals have not rushed to upgrade.

MemorialCare Medical Centers, a nonprofit, earned $89 million in its 2005-06 fiscal year -- 7.2% more than it spent, according to the company’s latest annual report. But only one of its six hospitals, Orange Coast Memorial Medical Center, meets state standards because it was built after the first seismic safety rules were enacted, said company President Barry Arbuckle.

Arbuckle said the group plans to rebuild its Long Beach hospital by 2015, sell another in Anaheim and win state approval to reclassify its hospitals in Laguna Hills and San Clemente as less vulnerable to collapse.

Arbuckle, who will chair the California Hospital Assn.'s board in 2008, said he has seen “no change” in the ability of struggling hospitals to afford seismic upgrades.

He predicted many will simply keep hoping the state doesn’t close them.

“I know there a host of people out there who are playing seismic chicken,” Arbuckle said.

Even some hospitals that have been through major quakes have not yet come up to seismic code, state records show.

Northridge Hospital Medical Center, at the epicenter of the 1994 quake, is almost done reinforcing its main surgical building but will not finish replacing two patient towers with one new one until 2013, said Ron Rozanski, senior vice president for operations.

He said the hospital has spent a decade repairing $100 million in damage from the quake. The hospital decided to wait until that work was done before beginning seismic upgrades, he said, to avoid unmanageable disruptions for doctors and patients.

Saint John’s Health Center in Santa Monica was closed for nine months while it repaired damage from the quake. The hospital is constructing a $400-million building atop hundreds of sophisticated rubbery shock absorbers. One tower is open, but until the entire facility opens in 2010, the hospital will keep using two pre-quake wings that have not been upgraded.

Asked whether officials worry that a temblor will hit before they are done, Maura Winesburg, the Saint John’s executive in charge of rebuilding, said, “We hope we have God’s blessing.”

The average acute-care hospital is 45 to 50 years old.

A study released this year by the Rand Corp., a Santa Monica think tank, projected that about half of the buildings designated as most likely to topple in a quake would not be upgraded by the state’s next deadline, in 2013.

Short on resources

Even if all those hospitals begin work as quickly as possible, there aren’t enough trained contractors, building materials and state reviewers for the work to be done concurrently, the study said.

“Back in 1995 or 1996 it was pretty hard to convince hospitals they had to get moving on this, because they would have truthfully told you they have a lot of other things they have to get a move on,” said Charles Meade, a Rand scientist who co-wrote the report. “The people who have stepped up to the plate are the ones with financial resources and the desire.”

Elected officials who wrote the seismic safety laws blame hospitals for being overly optimistic about their ability to comply in future decades, only to come back to Sacramento later and demand more time.

“It just seemed to me to be a game,” said Tom Hayden, a former Santa Monica lawmaker who wrote the legislation setting the 2008 deadline. “They would fight the deadlines, draw them out as far as possible.”

Sen. Alquist said the industry should have complied by now: “Hospitals have known for 12 years that these standards were in place.”

But industry officials are not encouraging.

“There is not an economic solution that lies ahead of us for those remaining institutions,” said Daniel Gross, chairman of the board of trustees of the California Hospital Assn.

Sacramento researcher Patti Williams contributed to this report.