VENTURA COUNTY: Tobacco Settlement Dispute Heads to Court

      Lawyers for Ventura County and Community Memorial Hospital faced off in court Monday in a battle over which side should receive $260 million in tobacco settlement money, the Los Angeles Times reports. The county has been anticipating its share of the multibillion dollar tobacco settlement reached by the U.S. government and cigarette manufacturers. However, CMH has sponsored a ballot initiative that would divert the funds from the county to seven private area hospitals. County officials have refused to place the initiative on the November ballot, prompting CMH to sue. The county contends that the measure would "amount to unlawful interference with its budgeting practices, be an illegal gift of public cash to the private hospitals and encourage other private interest groups to raid public treasuries." Presiding over the case, Superior Court Judge Henry Walsh said, "I'm not interested in whether this is a good or bad legislation. It's whether it's legal or illegal." Although both sides have drafted plans to spend the money on health care, CMH attorney Richard Martland said the conflict has "nothing to do with health care and everything to do with reimbursing private hospitals" for health services provided for the indigent and the uninsured. Martland said, "It's just a claims bill. We are just reimbursing hospitals." Assistant county counsel William Moritz, however, said such a "reimbursement" would then be an illegal gift to private hospitals. Moritz added that using the settlement to reimburse private hospitals for indigent care would be "unfair" to the county-run hospital, which would receive nothing for providing the same services. Pointing out that the county has already spent $3.5 million of the settlement money, Walsh said the initiative would interfere with the county's budget process by requiring to pay back the money spent. However, Martland countered that $3.5 million is a "minuscule" amount for a county budget. After the hearing's conclusion, Martland said he was "confident" the judge would allow the initiative to be placed on the ballot. A decision is expected within 10 days. Walsh anticipates that the case will be appealed by the losing side (Kelly, 7/25).

'Pandering' to the Court?
      Following Monday's court proceedings, the Ventura County Board of Supervisors yesterday unanimously adopted a plan that would allocate $10 million a year from the tobacco settlement to a comprehensive health plan. Proposed by County Chief Administrative Officer Harry Hufford, the plan would provide funds for mental health programs, tobacco education, immunizations, community clinics and health care programs for the poor. The county would share some of the funds with not-for-profit health organizations, such as the American Cancer Society and the American Lung Association (Kelly, Los Angeles Times, 7/26). Hufford's new proposal contrasts with the county's original plan to use some of the tobacco money for several non-health care purposes, such as helping to relieve debts and thwart budget shortfalls (Surman, Los Angeles Times, 7/21). Questioning the timing of the vote, CMH officials charged supervisors with "pandering" to health care interest groups "in an attempt to curry favor" if the judge rules that the ballot initiative should appear on the November ballot (Los Angeles Times, 7/26).