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Options Are Few in Health Dilemma

L.A. County officials seeking $75 million to save key medical services have little in the way of choices. Most revenue is already tied up.

May 24, 2003|Sue Fox | Times Staff Writer

With $16.5 billion to spend on Los Angeles County's vast government, it might seem easy enough to find $75 million to save a few crucial health services.

In fact, however, supervisors and others say it is more difficult than it appears. Policy decisions over the years have committed some of the county budget to programs that are not easy to adjust quickly, and mandates have tied officials' hands in other areas.

Today, local officials control only a small fraction of the county's overall revenue, with more than 90% earmarked for specific state and federal programs. So when a judge recently halted county plans to save $75 million by closing one hospital and trimming beds at another, officials were left with few immediate options. The budget hole must be filled quickly to rebalance the books for the coming year.

The choices, none pleasant, include chopping other badly needed health services such as medical clinics or emergency rooms.

Or yanking millions of dollars out of law enforcement, libraries, parks or other programs that also have taken a big financial hit this year.

Or begging for mercy from state and federal governments saddled with their own financial problems.

"I don't know what we can do," said Yvonne Brathwaite Burke, chairwoman of the county Board of Supervisors. "Frankly, I wish I could say, 'My solution is to do this, this and this,' but it wouldn't provide the amount of money we need to maintain the existing health system."

In the longer term, the supervisors could explore a range of money-saving reforms, such as narrowing limits on which hospital patients to accept and what medical services to offer. They could negotiate new contracts with public employee unions, or hire some private companies to do part of the work.

But such fundamental policy shifts would take months or years to implement -- and probably would unleash a storm of political opposition.

For now, county leaders must look to readily available pots of cash. There aren't many big enough to do the trick.

Even if the supervisors chose a drastic remedy -- say, eliminating the Department of Parks and Recreation -- that would save only $60 million. Closing all 84 county libraries wouldn't suffice either; that would conserve just $21 million.

Cutting the whole Board of Supervisors and its 300-person administrative staff, which runs the county's executive office as well as board-appointed commissions and task forces, would save $41 million.

So far, no one is suggesting such measures. The county has instead tried to plug the growing deficit in its Department of Health Services by jettisoning health programs and shifting money around within the $3.1-billion department.

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It's Not Working

But it's not working. Blocked at least temporarily by the court, the county must preserve what it had planned to cut: Rancho Los Amigos National Rehabilitation Center in Downey and 100 beds at County-USC Medical Center in Los Angeles.

Health officials could try to pare costs somewhere else in the system, but attorneys defending poor patients have threatened to sue the county again if it tries to slash patient services.

So what else is left? Where might the nation's largest county, serving a population greater than that of 42 states, turn to find more money?

Skeptics -- and there are plenty -- say Los Angeles County retains a fat and sluggish bureaucracy rife with inefficiencies and larded with generous benefits for its 91,000 employees.

"Los Angeles County is still viewed as the land of milk and honey as far as public employees go," said Jon Coupal, president of the Howard Jarvis Taxpayers Assn. "They may have to take some pay decreases. That's what's happening in the private sector."

Any pay cuts would have to be renegotiated with the unions.

County officials often insist that their hands are tied because so many of the services they provide, from welfare to foster care, are mandated by the state or federal governments.

Indeed, the largest chunk of the 2003-04 budget -- $12.8 billion -- is set aside to pay for such mandates, as well as debt service and other fixed costs. Most of the health department's budget comes from federal and state sources.

An additional $2.4 billion covers services that the county must maintain to qualify for matching dollars from Sacramento or Washington. For example, Los Angeles County must kick in $15.9 million toward AIDS programs in the coming year to receive about $42 million in federal AIDS funding under the Ryan White CARE Act. Scrap the $15.9 million, and the matching money goes down the drain.

The same holds true for the $1.2 million the county contributes toward alcohol and drug prevention, a required match that leverages about $9 million in state substance-abuse funds.

Counties throughout the state are in the same bind. According to a 1999 report by the Public Policy Institute of California, counties have been transforming from independent local governments into agents of the state and federal governments ever since the Great Depression.

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