Los Angeles County Health Officials Expected To Recommend Major Cuts To Public Health System Next Month

Los Angles County health officials on May 1 said they plan to recommend converting two of the system's hospitals into clinics and laying off thousands of employees to reduce an expected $360 million budget deficit next year, the Los Angeles Times reports. Officials are considering converting High Desert Hospital in the Antelope Valley and one other as yet undetermined hospital into outpatient facilities. They also might propose to make Rancho Los Amigos Medical Center a self-supporting facility that will not be run by the health system. Kathryn Barger, chief of staff for the head of the district that includes High Desert Hospital, said that any closures of health facilities should be balanced with assurances that residents will have access to care (Ornstein/Riccardi, Los Angeles Times, 5/2). The hospital conversions and potential job cuts represent the second part of the county's plan to address the budget deficit. The first part of the plan involved closing four public health clinics (Kaiser Daily Health Policy Report, 3/22).

History of Funding Problems
Los Angeles County's health department has been "financially faltering" for 10 years in part because the county has nearly three million uninsured residents who rely heavily on county facilities and programs. The county faced bankruptcy in 1995 before receiving a $1 billion federal bailout (Los Angeles Times, 5/2). The bailout will begin to be phased out next year, causing a $360 million budget deficit in fiscal year 2004 and a $688 million deficit by 2005. A report released Jan. 29 by the department said that the county's attempt to reform the health system by sending uninsured patients to lower-cost clinics rather than hospitals for treatment -- a shift that the federal government required when it approved the bailout in the form of a Medicaid waiver -- has not produced expected cost savings (Kaiser Daily Health Policy Report, 1/31). System officials plan to visit Washington, D.C., next week to ask the Bush administration for more funding assistance (Los Angeles Times, 5/2).