LA County officials cut reimbursement rate for doctors who provide indigent care at private hospitals

County officials today agreed to cut by a third reimbursements for doctors who provide emergency care to the poor and uninsured at private hospitals, citing the lack of state funding.

Supervisor Don Knabe reluctantly voted in support of what he called a "huge retroactive cut'' with a "dramatic impact on our physicians.'' He simultaneously called for staffers to quickly pay out a backlog of claims and for continued lobbying of state officials to restore funding.

While many indigent patients are treated at county hospitals, where doctors are salaried, private hospitals also get their share of the poor without insurance, Medicare, Medicaid or Medi-Cal coverage.

Doctors treating those patients are entitled to partial reimbursement — previously based on 27 percent of county fees set for medical services.

About a third of reimbursements came from the state and the rest from the county.

But the state eliminated its funding, and the Board of Supervisors cut the county's reimbursement to 18 percent of scheduled fees to close the gap.

The new rate will apply retroactively to all services provided since July 1.

It is equivalent, on average, to about 43 percent of what Medicare or Medi-Cal pays for the same services. In one example of the impact of the new schedule, a doctor performing an appendectomy on someone unable to pay would receive $229 from the county, while a Medi-Cal patient would pay the same doctor $462. Medicare coverage would pay $420.

Staffers estimated that more than 350,000 reimbursement claims by 4,700 physicians will be filed annually.

County health officials felt compelled to cut the rate in the absence of state support "so that every doctor gets something,'' said Carol Meyer, chief network officer for the Department of Health Services. At the current rate, many claims would otherwise simply go unpaid.

Private hospitals with emergency rooms are required by federal law to evaluate and stabilize patients seeking emergency care, regardless of their ability to pay.

More than half of Los Angeles County's 72 hospitals are operating at a deficit, and two are in bankruptcy, Jim Lott, executive vice president of the Hospital Association of Southern California told the Los Angeles Times.

Lott said 11 hospitals have closed countywide since 2002.

But in the absence of other sources of funding, the county had little choice, Meyer said.

"It goes to health care reform and the need for health care for all,'' she said. "The story's been told for 10 years.''