Medi-Cal Providers Say Late Budget Threatens Health Care Services

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The state budget stalemate has turned into a giant headache for just about everyone involved in health care in California. The state has stopped paying its Medi-Cal bills, but the clinics and hospitals that care for the state's poorest patients still have to treat them. Some hospitals soon will have to close their emergency rooms or cut back services. KPCC's Julie Small says one hospital in the San Bernardino Mountains might be forced into bankruptcy.

Julie Small: Just about anyone in health care that treats California's low income patients hasn't been reimbursed one state dime for that care since the end of July. That includes hospitals, clinics, nursing homes, homes for the developmentally disabled, and adult daycare services. Jan Emerson of the California Hospital Association says the state government owes them more than $3 billion. A billion of that money goes to the hospitals.

Jan Emerson: We've got many hospitals that, within the next few weeks, are not going to be able to make payroll. We have hospitals that are having to pay vendors with their own personal credit cards from the management team.

Small: Emerson says some hospitals will have to shut their emergency rooms. For others, the way to stay afloat is to close long-term care wards or scale back other services.

Emerson: It's a dire situation. And if the budget does not get passed very soon, you are going to see patient care services being shut down, and people's lives are going to be at risk.

Small: That dire situation is especially bleak for California's 30 rural hospitals. Many of them can't get loans to make up for the shortfall in state dollars. Jim Hoss runs Mountains Community Hospital in Lake Arrowhead. For the roughly 30,000 people who live near the lake, it's the only hospital within 45 minutes.

Jim Hoss: We're going to have problems paying our bills until the state of California pays theirs.

Small: Hoss says the state owes his hospital close to a million dollars. He's used up his reserves, and now he can't pay all the bills. And vendors aren't always forgiving. He says one pharmaceutical supplier refused to deliver an order. Hoss doesn't have the option of turning away Medi-Cal patients. In Lake Arrowhead, there's nowhere else for them to go.

Hoss: People still come to the hospital, come to the emergency room. They need to be fed, they need to have their pharmaceuticals, they need to, to be treated, and that all takes manpower, supplies, and we have to buy them from vendors, and pay our people.

Small: Jim Hoss says if state lawmakers don't pass a budget in the next couple weeks, Mountains Community Hospital might file for bankruptcy. That way, he can keep the hospital doors open. He hopes that will buy him enough time for the state to pass a budget, and pay his hospital back.