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County Fears Health Care 'Meltdown'

Medicine: If U.S. fails to extend a key waiver, outpatient clinics to which needy patients have been shifted may close, spelling disaster for the uninsured.


Jose Gustavo Rodriguez flew to Mexico to get a liver biopsy to determine that he had hepatitis C because he couldn't obtain timely treatment at the public hospital a few miles from his East Los Angeles home.

Christina Russi had to pull out her own infected tooth because she had no health insurance, and was trapped in her house for six weeks with scabies and no access to a doctor.

Christina Clark struggled through years of irregular treatment at a county clinic for her chronic diabetes before finding a program that got her regular care that may have saved her from having her feet amputated.

Five years ago, with a $1-billion assist from the federal government, Los Angeles County promised to reshape its notoriously bloated and baroque health care bureaucracy, thereby improving access to treatment for Rodriguez, Russi, Clark and the nearly 3 million other uninsured county residents who must rely on public hospitals and clinics.

By most statistical measures, the county--despite many massive changes--has fallen short of its ambitious goal. And now, even those incomplete gains are jeopardized, at potentially staggering human cost, by the expiration next month of the $1-billion waiver of Medicaid rules that has kept the county's health system afloat.

A squabble involving three levels of government over who will pay for a new waiver has left talks over its extension in limbo, five weeks before the current exemption expires. Speaking of a possible "catastrophic meltdown," the Board of Supervisors last week abruptly froze all expansion of the county's outpatient system and it is expected to freeze staff levels in the Department of Health Services this week.

Officials fear that L.A.'s public health care revolution has ended before the first battle was won.

"We've had some setbacks, but we've also had good things happen," Supervisor Don Knabe said last week. "If we don't continue to follow through with reform, it'll set us back--and worse yet, the population that needs the services won't be getting as good services."

That includes Rodriguez, Russi and Clark--and Rufina Juarez and her three children.

Juarez's husband is a jewelry repairman without health insurance. Because he works, she does not have Medi-Cal but gets regular checkups with her children at the private Community Healthcare Foundation of East Los Angeles, which receives about $2 million--because of the waiver arrangement--to care for the uninsured.

If the county did not reimburse the foundation for Juarez and her children's care, "I would only bring them in an emergency," she said. Or take them to the emergency room of nearby County-USC Medical Center.

The waiver was granted in 1995 to keep Juarez from doing just that.

Los Angeles County was on the brink of bankruptcy. Its health care system was collapsing because it emphasized pricey hospital care over cheaper outpatient treatment.

Steering patients to hospitals rather than to outpatient care is bad in two respects, experts say. First, it means people receive medical care only in emergencies, even though their ailments could have been caught during routine checkups and treated when they were less severe. Second, it is far more expensive.

The federal waiver was intended to shift the focus of the county medical system to outpatient treatment. County officials pledged that by 2000 they would cut inpatient treatment by 33%, log 1.8 million more outpatient visits and cut their $2.4-billion annual health care budget by $294 million.

'We Have a Lot More to Do'

They have fallen short in all three areas. Inpatient treatment has dropped by 28%, the county is 900,000 outpatient visits behind schedule and it is more than $100 million short of its savings target.

"There's no question that it was an ambitious agenda and we have a lot more to do," county Health Director Mark Finucane said, "but it's pretty obvious that the county threw itself into it in a way that showed we were serious about restructuring."

Added Supervisor Zev Yaroslavsky: "You can't turn around a battleship on a dime. . . . [But] we've moved; we've turned that corner. . . . If we don't get the waiver we'll be going backwards again."

Finucane said the county's inpatient drop is still triple the national rate. He attributed the problems in increasing outpatient visits to the time it took the public to believe that the health system was still operating after its near-collapse in 1995. And he has acknowledged that the county's estimates of what it could save were too optimistic.

Still, Finucane--who has been scolded by supervisors for falling short of the targets--and outside observers say that what the county has accomplished is an impressive first step.

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