Seis­mic man­date dead­line near

Calif. hos­pi­tals lack money to meet build­ing codes

Modern Healthcare - - The Week In Healthcare - Joe Carl­son

Cal­i­for­nia hospi­tal own­ers are hav­ing trou­ble meet­ing the state­man­dated dead­lines for mak­ing their build­ings more re­sis­tant to dam­age from earth­quakes, say­ing that the ail­ing econ­omy has left them un­able to fund the im­prove­ments.

Hospi­tal of­fi­cials plan to lobby state law­mak­ers this fall and spring to amend the state build­ing-code man­date, ei­ther by ex­tend­ing the dead­lines be­yond dates in 2013 and 2015, ask­ing for per­mis­sion to im­ple­ment stag­gered sched­ules for some of the work, or sim­ply en­forc­ing the stricter changes due to ap­ply in 2030.

Nine sys­tems that say they rep­re­sent about one-third of all hospi­tal beds in the state have joined to­gether in a coali­tion to urge re­lax­ation of the pend­ing seis­mic dead­lines: 38-hospi­tal Catholic Health­care West, San Fran­cisco; 29-hospi­tal Kaiser Per­ma­nente, Oak­land, Calif.; six­hos­pi­tal Me­mo­ri­alCare, Foun­tain Val­ley, Calif.; 24-hospi­tal Prov­i­dence Health & Ser­vices, Seat­tle; four-hospi­tal Scripps Health, San Diego; nine-hospi­tal St. Joseph Health Sys­tem, Or­ange, Calif.; two-hospi­tal Stan­ford Health Care, Palo Alto, Calif.; 23-hospi­tal Sut­ter Health, Sacra­mento, Calif.; and five­hos­pi­tal Sharp Health­care, San Diego, ac­cord­ing to a memo from Prov­i­dence.

“The loom­ing in­terim seis­mic dead­lines pose an un­rea­son­able bur­den on Cal­i­for­nia hos­pi­tals,” said Shelly Sch­lenker, vice pres­i­dent for pub­lic pol­icy and ad­vo­cacy for Catholic Health­care West, in a writ­ten state­ment. “Many hos­pi­tals will be un­able to meet the short-term dead­lines, thus forc­ing the state of Cal­i­for­nia to take them out of ser­vice for non­com­pli­ance. The state clos­ing hospi­tal build­ings would place an even greater hard­ship on the com­mu­ni­ties and peo­ple that they serve.”

The pend­ing dead­lines stem from a state man­date that fol­lowed the 6.7-mag­ni­tude earth­quake that struck Northridge, Calif., just north of Los An­ge­les in 1994. Af­ter the quake, law­mak­ers im­posed stricter stan­dards for seis­mic safety on acute-care hos­pi­tals. The dead­lines were set for 2008, later pushed back to 2013, and then ex­tended to 2015 or 2020 for cer­tain fa­cil­i­ties (June 22, p. 32).

Roger Richter, se­nior vice pres­i­dent of pro­fes­sional ser­vices at the Cal­i­for­nia Hospi­tal As­so­ci­a­tion, said the tur­bu­lent econ­omy has made meet­ing the dead­line of 2013 dif­fi­cult or im­pos­si­ble for providers both large and small.

“There are a num­ber of hos­pi­tals that, be­cause of the econ­omy, just can­not af­ford to meet th­ese seis­mic dead­lines, and many of them are larger sys­tems who a cou­ple years ago thought it would be no prob­lem,” Richter said. Now “they just can’t do it, or at least not all of it.”

David O’Neill, a se­nior pro­gram of­fi­cer with the Cal­i­for­nia Health­Care Foun­da­tion’s In­no­va­tions for the Un­der­served pro­gram, said the re­ces­sion’s im­pact on the cost of bor­row­ing and on payer mix at hos­pi­tals has ex­ac­er­bated the com­plex set of pre­ex­ist­ing fi­nan­cial chal­lenges fac­ing state hos­pi­tals. “Re­spon­si­ble hos­pi­tals and sys­tems have ac­knowl­edged and worked on deal­ing with their seis­mic safety chal­lenges, and they’ve worked hard at it,” O’Neill said. “Are there hos­pi­tals that for what­ever rea­son have de­cided that given their eco­nomics and cir­cum­stances that they don’t have any al­ter­na­tives and are not go­ing to take any action? There may be a hand­ful of those. But most hos­pi­tals and sys­tems and boards take this very se­ri­ously, as they must.”

Ac­cord­ing to the Of­fice of Statewide Health Plan­ning and De­vel­op­ment, which is charged with en­forc­ing the seis­mic man­date, hos­pi­tals in Cal­i­for­nia have seen their op­er­at­ing mar­gins and over­all mar­gins re­bound in 2009, based on quar­terly uti­liza­tion re­ports. Af­ter sink­ing to a neg­a­tive 1.6% op­er­at­ing mar­gin in the third quar­ter 2008, the of­fice said hos­pi­tals in the first quar­ter of 2009 were post­ing pos­i­tive 1.0% mar­gins, ac­cord­ing to the graph that was posted Oct. 8.

O’Neill says most fa­cil­i­ties “take this very se­ri­ously.”

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