Hospital Executives Lobby Legislators to Spare Ax : Health care: Nearly 800 officials argue against cuts in Medi-Cal and other programs. Optimism fades as budget realities become apparent.
SACRAMENTO — At the end of a long day of trying to persuade legislators to save his hospital and other health care programs from devastating budget cuts, the reality of California’s fiscal crisis hit hospital executive James Yoshioka hard.
“They simply don’t have the money,†Yoshioka said, his voice empty of the upbeat energy he had brought to the start of this whirlwind lobbying effort 11 hours before. Even legislators long sympathetic to health care interests countered Yoshioka’s arguments last week with the grim statistics of the state’s fiscal crisis--a gap between revenues and expenditures that the Wilson Administration and legislative leaders say requires $4.1 billion in program cuts.
This could include the slashing of 15.5% from Medi-Cal, the state’s thinly stretched health insurance program for the poor, as well as taking as much as $2.3 billion from public education. Even as he argued to save health care programs from financial devastation, Yoshioka was painfully aware that schoolchildren could end up paying the price of his success.
“Here we are throwing up health against education. . . . These are awful choices,†said Yoshioka, president of California Medical Center, a 344-bed hospital serving mostly impoverished residents in South Los Angeles.
Yoshioka was one of nearly 800 hospital executives who converged on the capital Wednesday for the industry’s spring lobbying fling--a day of hobnobbing with political power brokers and government leaders, followed by cocktail receptions.
The magnitude of the proposed budget cuts--announced by Gov. Pete Wilson even as Yoshioka and his peers trudged from legislator to legislator--gave this year’s gathering unusual urgency. Between meetings, hospital officials read newspaper accounts of the potential cuts with a grimness usually reserved for the obituary page.
If implemented, the cuts could force more than a dozen of the state’s 578 hospitals out of business, said David Langness, a vice president of the Hospital Council of Southern California.
By midafternoon Wednesday, Yoshioka was gloomily wondering if California Medical Center might be one of them. Not one legislator had been willing to encourage his hope that Medi-Cal would be spared the ax--a crucial issue for Yoshioka’s hospital, which depends on the program for roughly $30 million of its $80-million operating budget.
State Health and Welfare Secretary Russell S. Gould offered the grimmest scenario, suggesting program reduction estimates as high as 33%.
“If we have significant across-the-board cuts (in Medi-Cal funding), the question becomes: ‘What services do we cut?’ †Yoshioka said. “And we may be getting down to: ‘When do I close?’ â€
Yoshioka started the day confident of his message and armed with plenty of evidence of California Medical Center’s crucial role in Los Angeles’ inner-city health care network.
Located at South Grand Avenue and Venice Boulevard, the hospital was one of the busiest during the riots, treating 170 victims of the violence.
“Everyone is talking about rebuilding Los Angeles after the riots, but you can’t leave health care out of the rebuilding,†Yoshioka argued. “We are one of the core hospitals serving South-Central.â€
California Medical Center also has been instrumental in alleviating overcrowding in Los Angeles County’s public obstetric facilities, notably Women’s Hospital at County-USC Medical Center. And while some hospitals have closed emergency rooms to keep out unprofitable Medi-Cal or uninsured patients, California Medical Center has kept its emergency room open. Hospital officials say it is one of the only places that poor people in the neighborhood can get medical care.
Maintaining these commitments has been costly for Yoshioka’s hospital and others like it that depend largely on Medi-Cal.
The hospital ended the last fiscal year with a $17-million deficit, largely because of inadequate Medi-Cal reimbursement and costs incurred treating people without health insurance. Yoshioka expects to end the fiscal year Sept. 30 with a $6-million deficit. The anticipated deficit is smaller than in 1991 because of a special subsidy hospitals with high Medi-Cal case loads got this year--money that could be cut from next year’s budget.
The hospital has covered its deficit each year through private fund raising and loans from UniHealth America, the Woodland Hills-based, nonprofit health care chain with which the hospital is affiliated. But there are limits to what philanthropy can remedy, Yoshioka said.
“The more we do to serve the needs of the community, the more vulnerable we become to these kinds of cuts,†Yoshioka said as he waited to talk to Assemblyman Richard Polanco (D-Los Angeles).
Polanco told the hospital executives he would rather close corporate tax loopholes than slash health care funding. But no one in Yoshioka’s group asked--and Polanco did not say--whether these proposed tax changes could produce enough money to safeguard the health programs.
Other legislators and their staffs were more blunt about the inevitability of health care cuts.
“We are at the doomsday scenario,†said David Panush, budget consultant to Senate Leader David A. Roberti (D-Van Nuys), waving away the hospital personnel’s pleas for special consideration. “No one is going to be spared.â€
The executives had scripts for each meeting with legislators--prepared by the leadership of the California Assn. of Hospitals and Health Systems, which organized the lobbying effort--that were handed out at a pep rally.
Color-coded briefing sheets instructed them to hammer these points:
* Administrative reforms, not payment cuts to hospitals and doctors, are the best way to save Medi-Cal dollars. Among the reforms: better controls on the use of expensive medical tests and services, and measures to increase federal matching money.
* AB 3244 should not be passed. The bill would cut off Medi-Cal payments for patients hospitalized longer than 60 days. Those affected would be hospitals caring for the sickest patients--including burn and brain-injured trauma patients.
* Hospitals should not be taxed to generate money for indigent care--a law in several states, and a possibility here. The hospital industry gives away millions in charity care and any new taxes would erode this effort.
* Health insurance reform, guaranteeing affordable health care to all Californians, is the best long-range solution to the health care cost crisis.
But the meetings required a more extemporaneous approach.
Health insurance reform was quickly discarded in Yoshioka’s group as too long-range an issue to have any relevance to the crisis. Medi-Cal program efficiencies proved too complicated to sell effectively in the 10 to 15 minutes most of the legislators gave them. And Yoshioka believed that the anti-tax position was not relevant to all institutions. All hospitals are not equal in their charity, he noted. California Medical Center could be crippled by across-the-board Medi-Cal cuts while a hospital that routinely turns away Medi-Cal and uninsured patients would escape financial penalty.
“It is the hospitals serving the poor that are going to get hurt the most,†he said. “They are just going to get strangled and the wrong hospitals are going to shut down.â€
Yoshioka pressed that theme in meetings Thursday, and left the capital hopeful that legislators making the budget cuts would take each hospitals’ survival needs into consideration. By Friday, he was working out schemes to keep California Medical Center afloat until the state’s fiscal health improves.
“The frightening thing is that the recovery is expected to be so slow.†Yoshioka said. “But what are we going to do? We’re out of money.â€
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