LOS ANGELES-Already facing a potential deficit of nearly $900 million by mid-decade, the Los Angeles County Department of Health Services faces yet another staggering bill: $247 million for seismic upgrades.
That's what county officials said it will cost to bring all of its inpatient acute-care facilities up to stringent new earthquake codes by 2008.
According to a report submitted to the state agency that oversees hospital management, the Office of Statewide Health Planning and Development, Los Angeles County's health services department operates 34 buildings that pose a significant danger of collapse after a strong earthquake and need to be either retrofitted, replaced or converted to noninpatient care. The total represents more than 3% of all the hospital buildings in California that will require replacement or retrofitting.
State legislation requiring hospitals to upgrade their buildings was passed shortly after the 1994 Northridge earthquake. Buildings that pose a significant danger must be retrofitted or converted to noninpatient use by 2008, and those that may be rendered nonfunctional in an earthquake must be retrofitted by 2030. Hospital operators estimate the statewide cost of compliance to be $24 billion.
Among the county-owned hospitals that will cost the most to bring into compliance are 257-bed King-Drew Medical Center, which will cost $60.8 million to retrofit, and 336-bed Harbor-UCLA Medical Center in Torrance, which will cost an estimated $50.4 million to bring into compliance. Rancho Los Amigos National Rehabilitation Center, a 207-bed hospital in Downey, operates 15 buildings that pose a significant danger in an earthquake, but county officials were unable to provide a cost estimate to make them compliant.
County officials said they are examining what to do and have yet to formulate an official plan. "We're looking at retrofit vs. replacement options," said Santos Kreimann, the health department's director of facilities support services.
Kreimann added that there is no clear-cut plan to pay for the work. The county is discussing financing options with state lawmakers and has contacted various hospital lobbying groups for help.
James Lott, executive vice president of the Healthcare Association of Southern California, the regional hospital lobby, said the county could finance the seismic work through new bond issues.
"They have financing options the private sector doesn't," Lott said. "They can defer the cost and don't have to book it as an operating expense. It doesn't have to exacerbate their current financial problems." But he added that servicing the bond debt could be difficult for the cash-strapped department.
The looming costs of seismic upgrades for 470 hospitals-estimated by the California Healthcare Association to be $24 billion-has not escaped state lawmakers. Three bills have been introduced in the Legislature in recent weeks that would either provide financing for hospitals to pay for their upgrades or extend deadlines for performing the work. All the bills remain in committee and have yet to come to a vote.