Cuts Threaten Health Care for Poor, Studies Say : Budget: Reports conclude that if High Desert Hospital in Lancaster closes, private facilities could not pick up the slack.

As county officials grapple with how to provide adequate health care in the face of a mammoth budget gap, two recent reports indicate that private hospitals and physicians cannot be counted on to care for the poor.

One study, conducted in June by the Los Angeles County Department of Health Services, reveals that the closure of High Desert Hospital in Lancaster would create possible life-threatening health care shortages in the remote area.

A second health department report predicts increased waiting times at surviving county hospitals and clinics that proposed closures and cutbacks would bring--including six-month waits at Olive View/UCLA Medical Center in Sylmar, where most of High Desert’s patients would be sent.

Health department officials believe that scenario would be repeated throughout the county if one or more of its six public hospitals is closed.

“Unfortunately, the situation in the Antelope Valley gives you a microcosm of the situation all over the county,” said Walter Gray, the health department’s assistant director. “In every area, there will be not enough access, not enough people to care for the indigent.”

As part of an effort to reduce a $655-million deficit in the county health department, High Desert and three other public hospitals are on one proposed closure list, while County/USC Medical Center is on another.

Closing High Desert alone would save the cash-strapped county $35 million, and eliminate 629 jobs at the hospital.

Although county Chief Administrative Officer Sally Reed favors closing County/USC, a specially appointed health task force is now reassessing the situation--in effect, starting the process of deciding what to cut all over again.

As part of its evaluation, the task force is looking at the health department’s High Desert report, which looked into whether the area’s three private hospitals might pick up some of the slack if High Desert closed. The three are only operating at about 50% of their capacity, a rate typical for many private hospitals in the county.

But all three--Antelope Valley Hospital Medical Center, Lancaster Community Hospital and Desert Palms Community Hospital--said they would not care for any of the county hospital’s poorest patients, except in emergencies, as required by law.

Only Antelope Valley Hospital agreed to accept new Medi-Cal patients--those low-income people covered by the state’s public medical insurance. Antelope Valley Hospital is the only one of the three that has a contract with the state to provide Medi-Cal services.

An added problem, the 60-page report noted, is that none of the private hospitals has adequate staffing, space and equipment to offer the level of outpatient services now provided at High Desert.

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The response of local physicians to the possible closure was no better, according to the study, as only six of 22 physicians interviewed agreed to see new Medi-Cal patients, and none were willing to accept new patients without insurance.

In all, the report said, High Desert’s 39,786 annual Medi-Cal patients, and the 29,864 more without any insurance, would have little or no access to adequate local health care.

While most patients with insurance “could likely be absorbed by the private hospitals in the area,” the report states, “indigent inpatients, most outpatient specialty services, and uncompensated rehabilitation and skilled nursing services would have to be referred to other county facilities . . . out of the area.”

Most people, according to the report, would be referred to the local county health clinic--Antelope Valley Health Center--or to Olive View, as much as an hour’s drive away.

“What we’re most worried about is, because of the Antelope Valley’s isolation, access to health care would be very limited,” said Kathryn Barger, health deputy to the county supervisor who represents the area, Mike Antonovich. “If we eliminate services up there, we’re endangering people’s lives.”

Even those who made it to Olive View would face interminable waits because of cutbacks there, according to the second study, which projected the impact of hospital closures on a countywide basis.

The Sylmar hospital faces the cutback or elimination of 23 outpatient services it offers--affecting 20,000 patient visits annually, including the fields of general surgery, urology and general medicine.

The cuts could also swell waits for general surgery from 36 to 126 days, urology-related treatment from seven to 180, and general medicine from 19 to 180.

But private, for-profit hospitals and doctors say they would be unable to take on most of the patients for fear of risking their own financial stability.

One problem, private hospital administrators say, is that they lose money when they care for uninsured patients and often do not receive adequate compensation from the state when they treat Medi-Cal patients because of low reimbursements.

Meanwhile, county health officials say they cannot guarantee private hospitals a certain percentage of Medi-Cal patients--to help offset the loss on the uninsured patients--because state law grants Medi-Cal patients the right to choose their hospital.

In fact, county hospitals are reluctant to give up Medi-Cal patients even in the event of closures because they form the fiscal backbone of the public health care system. That helped unravel negotiations between the county and a consortium of private hospitals that recently offered to pick up some Medi-Cal patients.

“That’s what they butted heads over, but I think they can work something out,” said Jim Lott, a vice president with the Healthcare Assn. of Southern California, which represents 230 public and private hospitals.

Desert Palms Hospital, a private, 123-bed facility in Palmdale, provides a good example of the bind private hospitals say they are in. Currently, 35% of its patients are indigent (without any health insurance whatsoever, with many of them believed to be illegal immigrants), and another 35% are on Medi-Cal, the state insurance system for low-income, legal residents.

Not only does the hospital end up treating indigents for free, but it often does not receive sufficient funds for the Medi-Cal patients, Desert Palms Administrator Elizabeth Scarcelli said.

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If High Desert were to close, Scarcelli said she fears the number of poor patients at her hospital would only increase, particularly in her six-bed emergency room, which had 18,000 visits last year.

“As a hospital, you have to expect a certain part of the service you provide to be pro bono if you are at all moral and ethical,” she said. “The concern we have is that we feel we are supplying our humanitarian deed to the community already.”

So far this fiscal year, Scarcelli continued, the hospital is already $1.8 million in the red for caring for the indigent, mostly in the emergency room. She expects the hospital’s emergency room would only get busier with poor patients waiting to seek treatment until it cannot be avoided.

“We are extremely concerned about accessibility of care,” she said. “People are not going to travel 40 miles to Olive View. That’s not going to happen. . . . There’s also a real problem up here with limited access to [public] transportation.”

Still, Scarcelli said she will pursue a Medi-Cal contract to fill up beds--half of which are empty at any given time. Although she had decided to do so before the possibility of High Desert closing, she concedes that it is a drop in the bucket to what is needed.

At Lancaster Community Hospital, Administrator Steve Schmidt said his 131-bed facility also cannot be counted on for much help.

The first problem, he said, is that his facility--which does not have a Medi-Cal contract with the state--is sometimes reimbursed at only 9 cents on the dollar for the Medi-Cal patients it treats. Sometimes, some of the hospital’s physicians do not bother to file for reimbursement funds.

But a more complex problem, he said, is the state’s changing health care environment, in which health maintenance organizations (HMOs) continue to gobble up patients and use that leverage to demand cheaper rates from hospitals. As that process continues, Schmidt said, hospitals such as his have no one to pass the costs to.

“You’ve got HMOs that want the lowest rates possible, then you’ve got Medi-Cal and Medicare that don’t pay for themselves, and then you’ve got indigents, in which you get no money,” he said. “Before, you could care for indigents and shift the cost somewhere else. Where do you shift the costs to now?”

The largest area hospital, Antelope Valley Hospital Medical Center, is considering applying for a special Medi-Cal contract with the state that would allow it to get larger reimbursements in exchange for taking on more patients. That might allow the 341-bed institution to take on some of the former county patients.

“The real challenge to our hospital is the indigent [patient],” spokesman Gary Cothran said.

The bind over indigent patients illustrates that in the final analysis, the hospitals are co-dependent. Said High Desert Administrator Bill Fujioka: Survival of the private facilities depends on the survival of public ones.

“If we go, the dominoes will fall,” he said. “I think private facilities will close. I don’t think they’ll be able to handle the workload.”