Tuesday, Jan. 02, 2007 | For the past two years, operators of major San Diego hospitals have been locked in a bitter dispute about their visions for the future of health care in the region. It’s a debate that foreshadows choices the county — and the rest of the country — will be forced to make as rapid technological innovation and population shifts further expose the deep divisions between the growing ranks of those who lack adequate medical care and those who have it.


VIDEO: A divisive ‘Vision for the Future’

In 2004, University of California, San Diego, rocked the local health care community when it revealed a long-term plan that called for transforming its Hillcrest Medical Center into an expanded, free-standing emergency room and moving all of its 385 inpatient beds to the university’s Thornton Hospital in La Jolla. Opponents accused the university of abandoning the poor in favor of a more wealthy — and more likely to be insured — suburban patients, and the move spurred the county to commission a broad examination of the care available to its neediest residents.

In December, the San Diego County Board of Supervisors formally gave its blessing to a comprehensive study, prepared by outside consultants, that highlighted the major challenges ahead for the delivery of health care to the county’s uninsured and indigent. At the same time, however, the study concluded that UCSD’s plans would have only minimal effect on the region’s medical safety net, giving the university ammunition against critics, including some members of the county Board of Supervisors.

“The idea that we are somehow walking away from our commitment of being a major provider of care for the uninsured is simply false. It’s untrue,” said Leslie Franz, a spokeswoman for the university’s health system.

Over the next three decades, the university plans to spend three-quarters of a billion dollars to modernize the two hospitals that make up its medical center. When finished, university leaders envision, the medical center will become a regional hub for a new generation of high-tech medical procedures, incorporating the latest advancements in minimally invasive surgeries, private rooms and telemedicine. It will include state-of-the-art diagnostic equipment and offer the latest specialty procedures.

But the university’s efforts will fall short, UCSD officials say, if it is forced to spread its resources over two hospitals, both because of the costs of purchasing each piece of equipment twice, instead of once, and because neither location, by itself, will see a high enough volume of advanced procedures to allow doctors there to become proficient in them.

The operators of other hospitals in the area, though, fear that UCSD’s flight will force them to shoulder an even greater burden of the region’s uninsured patients. That could be an expensive proposition in an area where local and federal health funds are scarce and five hospitals have closed over the past 10 years, in large part due to financial reasons.

“Very simply said, UCSD is going to close a hospital and an acute-care department where we need it. And they’re going to expand a hospital and an emergency department where we don’t need it,” said Brent Eastman, the chief medical officer at Scripps Memorial Hospital in La Jolla.

Unintended Consequences

The plans for closure of Hillcrest have come in the midst of two somewhat clashing trends in the health care industry.

Hospital construction is experiencing one of its biggest booms in decades, according to Census Bureau figures. On the other hand, however, many urban hospitals are packing their bags, closing shop and moving to the suburbs and rural areas. Some are simply packing their bags and closing shop.

“This is a major social issue,” said Randall Bovbjerg, a researcher with the Urban Institute, a left-leaning think tank that specializes in social and economic issues. “Hospitals, like supermarkets, follow the money — and the paying clientele. And that leaves the 7-Eleven in the inner city.”

In a report published in 2000, Bovbjerg and his co-authors called UCSD’s acquisition of Hillcrest from the county in 1980 a successful alternative to yet another in a string hospital closures in urban cores. Since then, several key things have changed.

In California, the construction explosion has further been stoked by a state mandate that hospitals upgrade their facilities to meet stricter seismic standards over the next three decades. That increased demand has helped make the state one of the most expensive places to build a hospital, with costs approaching $600 per square foot, or nearly double that of nearby states, said Dick Crowley, of Phoenix-based Kitchell Contractors.

Given the conditions in the marketplace, the university says it would cost more to retrofit Hillcrest hospital than to expand Thornton. And given the growth in the north, now the most populace place in the county, it makes sense to build new facilities where the people are, it argues.

“The suburbs ain’t what they used to be,” UCSD’s Franz said.

Critics, though, point out that most of the area’s trauma needs remain south of Interstate 8, as do the area’s most vulnerable residents, who may lack the resources and the transportation to get to Thornton.

“It’s counter-intuitive to me, when you talk about the safety net in San Diego County, that anywhere in that logic would like the closure of Hillcrest hospital,” Scripps’ Eastman said.

Scripps Health, which operates the other trauma center in downtown San Diego just blocks from Hillcrest, worries that the move will mean that its money-losing Scripps Mercy Hospital and its satellite location in Chula Vista will bear the burden of treating the uninsured and underinsured currently served by UCSD.

The Broken Safety Net

Before it can get blessing from the state’s regulators, UCSD has to overcome one major hurdle: It is currently illegal in California to operate a free-standing emergency room, one not connected to a full-service hospital.

But the university is betting that the laws will change by 2030, when it plans to move the last of its acute-care beds from Hillcrest.

“We believe as more and more states are adopting free-standing emergency room models, by the time our plan goes into play … California will also have adopted free-standing emergency rooms as the standard of care,” Franz said.

In recent years, several lawmakers have offered skeletal bills for licensing stand-alone emergency departments, though they did not get far. In Los Angeles, a hospital group abandoned its push for the law change after voters approved a bond measure to help retrofit the area’s hospitals.

Up until now, the supporters of free-standing emergency rooms have looked at them as a way to bring health care to rural areas that may lack the population and demand to fund full hospitals. Though UCSD argues free-standing emergency rooms will prove to be a solution for the rising cost of medical care, opponents say Hillcrest would be the first time that an emergency department, even one with additional outpatient care, has replaced an entire hospital.

“It is a model designed for areas that are underserved and don’t have the facilities,” Eastman said. “I don’t think anyone said it’s for tearing down a hospital and replacing it with a free-standing emergency department.”

Both sides do agree, though, that UCSD’s push north is indicative of a deeper reality: the financial vulnerability of the San Diego’s hospitals. Unlike Hillcrest, the area’s two other hospital owners, Scripps and Sharp HealthCare, have been operating in the red in their facilities located in central and southern San Diego. And things haven’t always been very bright for UCSD — in 1996, Hillcrest lost $20 million, prompting massive layoffs and service reductions.

If Hillcrest were to reduce its inpatient services, it would be following in the steps of five San Diego hospitals that have closed their doors in the past decade; two more, Paradise Valley Hospital and Alvarado Hospital, have also been put up for sale or sold in recent months.

“We are really a microcosm of the national crisis. And it all boils down to that we, the hospital providers and the doctors, we are the safety net of the safety net,” Eastman said. “And that’s particularly true in San Diego.”

Much of the blame, hospital operators say, lies at the feet of the county, which ranks near the bottom in California on health care spending for the poor. Under state law, counties bear the responsibility of providing medical care to those who can’t afford it. They also blame the federal government, which uses special formulas to compensate hospitals for their treatment of indigent patients; under those formulas, San Diego County facilities are reimbursed at one of the lowest rates in the state.

“We are in a diabolical situation where we are paid as though we are rural community, and we’re going to wake up in San Diego one day, and we’re not going to have doctors or any hospitals, because no one is going to be able to keep their door open,” Eastman said.

UCSD says that financial reality underpins its long-term plans.

“This is not only cost in, ‘Oh gee, we want to make enough money, but it’s cost of basically surviving,” said David Guss, the university’s director of emergency medicine.

A Vision for the Future

Though the Hillcrest facility continues to make money, limiting it to emergency and outpatient services is the most efficient way to bring the university health system into the 21st century, its leaders argue.

“Our long-term strategy is built on the premise that we intend to be in this community well past 2030. Therefore, we have to be responsible in the way we use our scarce resources,” said Richard Liekweg, the medical center’s CEO. “Within UCSD, we focus our efforts in a very balanced way. We look at our financial resources, but we focus on our quality, patient satisfaction, innovation, growth, and we try to strike a balance. We manage that on an hour-by-hour, day-by-day, patient-by-patient basis.”

“[W]e’re going to wake up in San Diego one day, and we’re not going to have doctors or any hospitals, because no one is going to be able to keep their door open.”
— Brent Eastman,
Scripps Memorial Hospital chief medical officer

Because only one of out every seven patients that seek care from the university need to be hospitalized, UCSD argues, its plans will provide Hillcrest with the increased emergency-room capacity the hospital will require, while centralizing the inpatient services for the few who will need them near its academic campus. When patients need urgent care and simple diagnostics, they’ll go to Hillcrest, and for more serious care, like major surgeries, they’ll be able to go to Thornton.

However, organizations that operate other hospitals south of Interstate 8 worry that UCSD’s move will saddle them with the responsibility for the patients that will not or cannot make the 13-mile trip from Hillcrest to Thornton for their care.

Though UCSD says its models predict that most of its patients will follow their doctors to Thornton, Scripps Health expects that it will get stuck with treating those who will choose to go to another provider close their homes, instead of traveling to La Jolla. For some in need of urgent inpatient care, Eastman predicted, the delay of the 13-mile trip could prove deadly.

Eastman pointed to the roughly 9,000 UCSD patients who currently do require inpatient treatment and hospitalization. Though most will still be able to go to Thornton for their care, and though the university promises to provide free shuttle services between Hillcrest and La Jolla, both UCSD and the county study admit that a small number will be left behind.

Much of the debate surrounding the planned move is whether a potentially fatal inconvenience for a small number of patients should stand in the way of improved health care for the great many — especially if those select few are significantly worse off economically than the many that benefit.

A County or an Academic Hospital?

At the heart of the disagreement about the future of Hillcrest is a fundamental discord about the hospital’s role in the community. It’s a dispute that stretches back to 1980, when the university purchased what was County Hospital, a provider of care-of-last-resort that UCSD had been leasing from the county since the mid-1960s.

“We did not purchase a county hospital,” Franz said. “We purchased it to transform it, and have been running it as a university hospital. We believe we have an obligation to deliver … not only the kind of care an academic center is supposed to deliver, but also to create an environment in which clinical research and transitional research can take place.”

San Diego County Juvenile Court Judge Larry Kapiloff remembered it differently. At the time of the sale, Kapiloff represented parts of San Diego in the state Assembly and had carried the legislation that allowed the university to purchase the hospital from the county.

When he first introduced the bill, Kapiloff recalled, he was approached by a community group that feared the university would buy the hospital only to close it down. In response, Kapiloff said he delayed the legislation to extract a promise that UCSD would continue to run the hospital, a commitment he did not believe came with an expiration date.

When the UC Board of Regents met last January to give formal approval to the Hillcrest move, Kapiloff was there to protest what he saw as a broken promise.

“What I’m concerned about is that I represented that area, and the people there are not getting any younger. And they’re not going to be able to take the bus up to La Jolla,” he said.

However, the university argues that its commitment to keeping the hospital open ended when its special operating agreement with the county did, a little more than a year ago. Regardless, said the university’s Physician in Chief Thomas McAfee, Kapiloff’s concerns about the treatment for the indigent and elderly are misplaced.

“The only reason the University of California owns and operates hospitals is to support the academic mission of the schools,” McAfee said. “We feel that embedded in that mission is the need to expose our med students and our residents to a broad diversity of patient types, ethnically, sociologically, and pathologically.”

It’s a view shared by other supporters of the move.

“I can tell you that where we stand today, where I stand today, the legacy I hope to leave behind and even to strengthen is to serve all patients,” Guss said, the university’s head of emergency medicine. “And if UCSD evolves into an entity that is no longer committed to serving all patients I would not want to have any association with UCSD.”

Publicly, the county has said little about UCSD’s plan, and its Department of Health & Human Services did not return calls for this story in late December. But behind the scenes, its longtime Sacramento lobbyist Jonathan Clay is working on a way to keep the Hillcrest facility open, Kapiloff said.

Clay was in South America in late December and unavailable for comment, his office said.

To Guss, the dispute underlies a tectonic shift and a new reality in the health care industry.

“I certainly lament the fact that medicine in this country has gravitated toward the notion that everyone is getting paid for what they do, and not being on call, and not being available for patients that we serve,” he said. “I think we need to reenergize ourselves to what it says in the Hippocratic oath, and the Hippocratic oath is serving human beings.”

Please contact Vladimir Kogan directly with your thoughts, ideas, personal stories or tips. Or send a letter to the editor.

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