HOSPITAL FUNDING: Health System in ‘Deep Crisis’

      While state lawmakers spent the last hours of the legislative session settling a long-running feud over the rebuilding of Los Angeles County's County-USC Medical Center, Sacramento Bee columnist Dan Walters asserts that the compromise "did virtually nothing to resolve a much-larger and much-deeper hospital crisis." Pointing out that 60% of California hospitals are in the red, Walters argues that hospitals are "facing a financial squeeze born of tighter policies of health insurers, cutbacks in state and federal financing and new laws compelling hospitals to become more earthquake resistant." Further highlighting the problem, the Los Angeles County trauma system also is "near meltdown," forcing county officials again to ask the state to step in and offer some relief, Walters notes. What is "noisily evident in Los Angeles is also happening in other metropolitan areas," Walters maintains, because "income from private and public sources falls short of what hospital officials say is needed to cover their expenses." Compounding the financial problems hospitals face, Walters notes, is the cost of state-mandated seismic upgrading. According to the California Healthcare Association, the total price tag for the upgrade is $24 billion, "the equivalent of the hospitals' total, undepreciated assets," Walters states. To help shoulder the financial burden, hospitals have "shepherded through the Legislature" four bills that would ease some of the seismic requirements, Walters notes. However, if there is "no relief," hospital officials maintain that some facilities will be forced to close. "Regardless of what he does on those bills," Walters concludes that "Gov. Gray Davis (D) will face a hospital crisis for the rest of his governorship -- one that may grow even more acute" (9/15).