Prognosis uncertain on federal deal for hospitals

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Los Angeles Daily News

Prognosis uncertain on federal deal for hospitals

By David M. Drucker
Staff Writer

A plan announced Wednesday providing $18.4 billion in federal money for California hospitals to treat the poor and uninsured faces an uncertain future because conditions attached to the deal could thwart legislative approval, officials said.

The five-year deal would bring in $3.3 billion more for hospitals that treat Medi-Cal patients and the uninsured than the agreement that expires June 30. But in an effort to lower Medicaid costs, the Bush administration is forcing the state to shift more recipients to "managed care," a move generally opposed by Democrats, who dominate the Legislature.

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The hospital financing waiver sets conditions for California to obtain federal matching funds for hospitals that treat Medi-Cal patients and the uninsured.

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Some Democratic leaders are concerned it would not protect hospitals that treat Medi-Cal patients and the uninsured -- including county hospitals -- from financial instability. County Chief Administrator David Janssen echoed that sentiment, though neither Democrats nor the county are necessarily against the waiver. However, the California Association of Public Hospitals and Health Systems immediately announced its opposition. "We are concerned that the patients and communities we serve will see their access to health care diminish over the five-year life of this deal," said Denise K. Martin, president and CEO of CAPS. "Services we all rely on -- trauma, emergency, doctor training -- will become scarce."

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David M. Drucker, [phone] [e-mail]

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