As the GOP begins efforts to dismantle the Affordable Care Act (ACA), a new study predicts the state could lose more than 200,000 jobs if the ACA is repealed.
Repeal of federal healthcare reform could eliminate nearly 209,000 jobs and cost the California economy $20.5 billion a year, according to researchby the UC Berkeley Center for Labor Research and Education.
The $20.5 billion in lost revenue would result from the elimination of approximately $5 billion in federal subsidies for people who buy health plans on Covered California and the loss of more than $15 billion in funding for Medicaid expansion, the study estimated.
The job-loss estimates were based on the jobs that were created when the ACA went into effect, said Laurel Lucia, a healthcare program manager at UC Berkeley and co-author of the study.
"Hospitals, clinics, and other providers staffed up to meet increased demand as a result of the ACA and our economic modeling software estimates that many of those jobs would be lost if the ACA is repealed," said Lucia.
The majority of the job losses would be in hospitals, physician offices, labs, outpatient and ambulatory care centers, nursing homes, dentist offices, and other healthcare settings, the report noted. The loss of these jobs would result in a ripple effect of job losses in other industries.
"Our analysis takes into account the multiplier effect," said Lucia. "When healthcare workers found new jobs, their income was circulated through the community multiple times."
Additional industries ranging from food service to janitorial services to accounting and other professions would also be affected, she said.
Poorer and rural areas, such as Merced and Tulare counties, would lose more jobs than other parts of the state, according to the report. These areas have a higher-than-average population enrolled in Medi-Cal due to Medicaid expansion, the largest single source of federal spending in the UC analysis.
Tulare County has the highest percentage of Medi-Cal enrollees, at 55% of the population, followed by Merced County with 51.5% and Imperial County with 50.6%, according to a study by the state's Department of Finance and Department of Health Care Services.
The UC Berkeley study also noted that repeal of the ACA could include some benefits to offset the estimated loss of $20.5 billion in revenue.
The losses would be partially offset by limited economic gains from repeal of other provisions in the ACA. These include potentially $6.3 billion in tax cuts to California insurers and high-income households, and $1.3 billion in eliminated penalties for uninsured individuals.
Employers would save money by not offering affordable coverage, according to the research.
State Hires Former AG
To combat impending changes to the ACA and other policies proposed by the administration of president-elect Donald Trump, California lawmakers hired former U.S. Attorney General Eric Holder as an outside counsel.
Holder served as U.S. attorney general from 2009 to 2015 and is currently a partner at Covington & Burling, a Washington DC-based law firm that specializes in representing states and companies in lawsuits against the federal government.
"Having the former attorney general of the United States brings us a lot of firepower in order to prepare to safeguard the values of the people in California,” said state Sen. Kevin de Leon (D-Los Angeles).
Hiring Holder signals the state "is very serious" about defending the ACA, de Leon said.
State lawmakers introduced new bills that would increase physician reimbursements for the Denti-Cal program and prohibit law enforcement from enforcing immigration laws in hospitals.
California lawmakers introduced new bills that would increase funding for the state's Medicaid dental program and make hospitals a 'safe zone' for undocumented immigrants.
Assembly Bill 15, introduced by assembly member Brian Maienschein (R-San Diego), would increase reimbursement rates for dentists participating in Denti-Cal, the state’s dental plan for Medi-Cal patients.
In a letter to Gov. Jerry Brown, two assembly members supporting the bill asked the governor to fund Denti-Cal with revenue from Proposition 56, a $2-per-pack tax on cigarettes approved by voters in November that is expected to generate more than $1 billion in annual revenue.
"Provider reimbursement rates for the top 10 children’s dental services paid in California are only 35% of the national average," the letter stated, and low reimbursement rates are part of the reason no dentists in 11 counties are accepting new child patients covered by Denti-Cal.
A report on the Denti-Cal program released in April by the state's nonpartisan Little Hoover Commission described reimbursement rates for providers as "dreadful" and urged state and federal officials to work together to find new sources of funding for the program.
"Dreadful reimbursement rates and slow, outdated paper-based administrative and billing processes have alienated dentists to the point that most California dentists want nothing to do with Denti-Cal and, consequently, more than 13 million people eligible for coverage have few places to use benefits," said Little Hoover Commission Chair Pedro Nava.
Hospital 'Safe Zones'
Senate Bill 54 would make hospitals in the state part of a list of public places that would be 'safe zones' for undocumented immigrants.
The bill, dubbed the California Values Act, would prohibit law enforcement agencies from enforcing immigration laws in hospitals, schools, and courthouses to ensure undocumented immigrants have access to those institutions.
"To the millions of undocumented residents pursuing and contributing to the California dream, the state of California will be your wall of justice should the incoming administration adopt an inhumane and overreaching mass deportation policy," said bill sponsor Sen. Kevin De Leon (D-Los Angeles) in a statement.
As written, SB 54 would prohibit state and local law enforcement agencies, school police, and security departments from detecting, investigating, detaining, reporting, or arresting persons for immigration enforcement purposes.
It would require public schools, hospitals, and courthouses "to establish and make public policies that limit immigration enforcement on their premises and would require the Attorney General … to publish model policies for their use by those entities for those purposes."
The California Hospital Association (CHA) said it needs more time to analyze Senate Bill 54 before taking a position on it. Hospitals typically do not take part in policies dealing with immigration enforcement, said CHA Vice President of External Affairs Jan Emerson-Shea.
"Our job is to treat patients and take care of medical emergencies when patients are brought into the emergency department," said Emerson-Shea.
Lawmakers have also introduced a measure that would require physicians and hospitals to report drug-resistant 'superbugs.'
California lawmakers have introduced bills for the 2017 legislative session that would increase transparency for prescription drug price hikes and require hospitals to report drug-resistant "superbug" infections to state health agencies.
Earlier this month, Sen. Ed Hernandez introduced Senate Bill 17, which would require pharmaceutical firms to justify and explain price increases for prescription drugs. Hernandez authored a similar bill in 2016 that stalled in the state legislature.
"The skyrocketing costs of prescription drugs continues to be one of the biggest factors leading to rising insurance premiums in the state and impacting working Californians," said Hernandez.
"This issue will not go away and the public deserves answers. I look forward to working with my colleagues and stakeholders to ensure that California can begin to rein in out-of-control prescription drug prices."
Patient advocacy group Health Access California said the bill would control unexplained drug price hikes by requiring pharmaceutical companies to justify price increases for prescription drugs.
"California can't allow unexplained price hike of prescription drugs to continue to harm our health system and our families' finances," said Anthony Wright, executive director for Health Access California.
Last year, Hernandez introduced a similar bill—Senate Bill 1010—that passed the state Senate. However, Hernandez removed the bill from consideration after the state Assembly amended it to apply only to price hikes that increased the cost of prescription drugs by at least 25% or $10,000 in one year.
The amendment diluted the bill to exclude the vast majority of rate hikes, Hernandez said.
Other recent efforts to control prescription drug costs in California have not been successful. In November, state voters rejected Proposition 61, which would have required the state to negotiate costs with pharmaceutical companies and pay prices for prescription drugs that are no higher than prices paid by the U.S. Department of Veterans Affairs.
Critics said the measure was not workable and would have led to lawsuits if it passed.
Mandatory 'superbug' reporting
Another bill introduced for 2017 would require physicians to report cases of antibiotic-resistant infections on death certificates when they are a contributing factor in a patient's death.
Senate Bill 43, introduced by Sen. Jerry Hill, would require hospitals and physicians to report cases of carbapenem-resistant Entrobacteriaceae and other antibiotic resistant infections to the California Department of Public Health (CDPH).
Neither the Centers for Disease Control and Prevention nor the CDPH currently require providers to report antibiotic-resistant infections.
"Today, we have to estimate the number of deaths from [antibiotic-resistant] infections," said Hill. "We cannot hope to combat superbug infections without such critical information."
The bill would require hospitals to report cases of antibiotic resistant infections but would not require hospitals to disclose their identity.
Plaintiffs from three organizations are challenging faith-based health systems' right to operate pension plans that are exempt from certain federal laws.
The U.S. Supreme Court has agreed to hear arguments in a case that challenges the right of Dignity Health to operate a "church plan" pension plan.
The Supreme Court earlier this month agreed to hear arguments from Dignity Health and two additional faith-based health systems with church-affiliated pension plans.
The three cases, which will receive hearings in early 2017, involve plaintiffs who challenged the right of faith-based health systems to operate church plans, which are exempt from some federal laws that govern standard pension plans.
Dignity Health's case stems from the Dignity Health v. Rollins lawsuit filed in the U.S. District Court for the Northern District of California by former Dignity employee Starla Rollins in 2013.
The lawsuit challenges the right of Dignity Health to operate a pension plan that is not subject to the Federal Employee Retirement Income Security Act (ERISA).
The lawsuit suggests that since Dignity Health does not operate as a church, it does not have the legal standing to operate a church pension plan.
Dignity Health formed its pension plan in 1992 when it operated under its former name, Catholic HealthCare West. Dignity Health maintains that church plans do not have to be part of a church as long as they are maintained by a church-affiliated organization.
In July 2014, U.S. District Court Judge Thelton Henderson granted a partial summary judgment to the plaintiff and said Dignity Health was relying on an erroneous ruling from the Internal Revenue Service that gave its pension program church plan status.
The Ninth Circuit Court of Appeals upheld Henderson's ruling in a July 2016 decision.
U.S. Circuit Court Judge William Fletcher issued a ruling that stated that a church plan must be "maintained by either a church or a church-controlled or church-affiliated organization whose principal purpose is to provide benefits to church employees."
In September, however, the Supreme Court granted a temporary stay from the Ninth Circuit Court ruling so it could consider whether to hear the case in 2017. The Supreme Court will also consider similar cases involving Advocate Health Care in Illinois and Saint Peter's Healthcare System in New Jersey.
GOP politicians' plans to repeal the ACA will "throw the healthcare system into chaos," one advocacy group claims.
More than 50% of residents in some California counties are enrolled in Medi-Cal and more than one-third of all state residents are part of the program, according to a recent study.
The California Budget and Policy Center analysis showed Medi-Cal enrollment rates in most California counties have increased dramatically under Medicaid expansion, topping 50% in four counties and 40% in 16 others.
The study did not provide statistics on the percentage of Medi-Cal enrollees in each county before the Affordable Care Act (ACA) was enacted.
Tulare County had the highest percentage of Medi-Cal enrollees in the state at 55% followed by Merced County (51.5%), Imperial County (50.6%), Fresno County (49.9%), Madera County (45.3%), and Kern County (45.1%).
"Medi-Cal enrollees live in all 58 California counties and comprise more than 25% of the population in 49 counties," the study authors wrote.
However, millions of Californians now risk losing Medi-Cal coverage if president-elect Trump and Congress enact proposals to repeal the ACA and cut federal funding for Medicaid.
Los Angeles County had the most Medi-Cal enrollees, at 4.1 million or 40.2% of county residents. Orange County had the next highest total, at 911,194, but only 28.6% of residents are Medi-Cal members. Marin County had the lowest percentage of Medi-Cal enrollees, at 17.2%.
$4.6B in subsidies
A separate study from the Kaiser Family Foundation that looked at federal spending on subsidies in each state estimates that 1.23 million California residents received subsidies in 2016.
That study projects that total federal spending on subsidies in California this year will reach $4.6 billion and that enrollees receive an average subsidy of $309 per month toward their monthly premium.
Enrollees in some counties receive much higher average monthly subsidies, the Kaiser study found. In Kern County, the average Covered California enrollee received $417 per month while enrollees in Tulare County received an average subsidy of $592 per month.
While 90% of Covered California enrollees receive subsidies, the study found that 93% of Kern County and 96% of Tulare County enrollees receive subsidies.
California Budget & Policy Center Director of Research Scott Graves suggested that Republicans in the House and Senate could act swiftly in 2017 to reduce spending for both Medicaid expansion and the Medi-Cal program in general.
"There's a couple of ways they could go," said Graves. Congress could use budget reconciliation to repeal Medicaid expansion, which provides $15 billion in funding to the state annually, he said. Republicans could also change the Medicaid program itself.
"They could move to radically restructure Medicaid by creating a block grant system for funding or by creating a per-capita cap for funding," said Graves. "In both cases, the actions would shift more responsibility for funding Medicaid to the states and leave them with hard decisions."
If the worst does come to pass, "state policymakers will face difficult choices about how to mitigate the damage and preserve a healthcare lifeline for millions of Californians," he added.
Concerns about a potential rollback of Medicaid expansion were raised earlier this month when California Congressman Kevin McCarthy (R-Bakersfield), House majority leader, suggested that federal lawmakers could seek to repeal the ACA before coming up with a plan to replace it.
Anthony Wright, executive director of advocacy group Health Access California, said in a statement that the strategy is "wildly irresponsible" and would "throw the healthcare system into chaos."
The combine would raise costs and reduce choices for consumers, say state officials, researchers, and physician organizations.
The state of California is backing the U.S. Department of Justice (DOJ) as it seeks to block the proposed $45 billion merger between Anthem Inc. and Cigna Corp.
The DOJ filed an antitrust lawsuit against the merger in July and the trial began November 19 in U.S. District Court for the District of Columbia. California Attorney General Kamala Harris has said the merger "would drive up costs for consumers."
California joined 10 other states in supporting the DOJ lawsuit.
Anthem and Cigna contend the merger would create a more efficient company that would generate lower premiums. However, the DOJ alleges the merger would reduce competition and result in higher premiums for policyholders.
"Efficiencies don't count if the only way you get them is more market power," said DOJ Attorney Jon Jacobs in his opening statements.
The California Medical Association (CMA) on November 20 reiterated its position that the merger would likely be bad for consumers because it would create a larger company with more power over the market.
A CMA survey conducted earlier this year found that 85% of its physician members oppose the merger.
"The California Medical Association has opposed the Anthem-Cigna megamerger since day one because it will hurt patients and increase healthcare costs," said Ruth E. Haskins, MD, president of the CMA.
Limiting market competition would compel insurers to contract with fewer physicians, resulting in higher premiums and longer wait times for referrals, not to mention forcing many patients to pay more to see out-of-network doctors, Haskins said.
No theoretical or empirical data support claims that the merger would result in lower premiums, according to healthcare policy expert Gerald Kominski, PhD, director of the UCLA Center for Health Policy Research.
"Monopolistic power increases prices, it doesn't decrease them," he said.
California Insurance Commissioner Dave Jones is also opposed to the merger, which he said would give Anthem a market share of more than 50% in 28 counties in the state and a 40%-or-higher share in 39 counties.
"When it comes to the Anthem and Cigna merger, bigger is not better for California consumers or the health insurance market," said Jones.
The two insurers have a combined total of 8.2 million members in the state. According to data from the California HealthCare Foundation, Anthem has approximately 6.1 million members and Cigna has nearly 2.1 million members.
A second proposed mega-merger, involving insurers Aetna and Humana and worth $37 billion, is also opposed by the CMA and the state Department of Insurance.
However, this merger would impact California to a lesser degree. Aetna currently has about 1.3 million members in the state and Humana has an estimated 513,000 members.
The DOJ also filed an antitrust suit against the proposed Aetna-Humana merger and that trial is expected to begin this month.
The current open enrollment period won't be affected, regardless of what happens after the new administration takes arrives.
The policies of president-elect Donald Trump won't affect the current enrollment period for Covered California, but future changes are likely to impact the health exchange in California.
Despite the uncertainty, exchange officials are focused on the current open enrollment period that runs from November 1, 2016 to January 31, 2017, said Covered California Executive Director Peter V. Lee.
"We're here for the foreseeable future and we're the place to sign up," said Lee.
Covered California is projecting that 400,000 new members will enroll for coverage during the three-month open enrollment period.
Most analysts believe Trump is likely to follow through on earlier vows to "repeal and replace" the ACA, but it's still unclear how far those changes will go and what impact they will have on ACA funding.
"The debate is very much in flux and there's a lot of uncertainty about what's going to happen and about the timing," said Larry Levitt, vice president of the Kaiser Family Foundation.
"The conventional wisdom is that the new Congress will attempt to repeal the ACA starting in 2017 through some type of [budget] reconciliation strategy," Levitt said.
Levitt and other policy experts said they expect changes to the ACA to be incremental, unfolding over the course of two or three years. Republican majorities in both houses of Congress could expedite changes to the ACA.
"Many of the changes could be passed through budget reconciliation, which only requires 51 votes in the Senate, a majority of the House, and the president's signature," said Anthony Wright, executive director of Health Access California.
Reduced funding for federal subsidies could also play a major part in weakening the ACA in the state. Covered California estimates that 90% of the 1.4 million people who have enrolled for coverage through the exchange are receiving federal subsidies to help pay for premiums.
The state does not have the financial capacity to backfill the proposed federal cuts to health insurance subsidies or the cuts proposed for public plans, California Insurance Commissioner Dave Jones said recently.
Analyst Micah Weinberg, president of the Bay Area Council Economic Institute, estimates the state is receiving about $5 billion per year in federal funds for subsidies and more than $15 billion to fund Medicaid expansion.
The impact on California depends on "how much of that $20 billion federal spigot will be turned off," Weinberg said last month.
The state has added more than 3.5 million new members to Medi-Cal under Medicaid expansion, according to Sandra R. Hernandez, MD, president and CEO of the California HealthCare Foundation (CHCF).
Proposals to roll back or defund that program could have a major impact on the state, which now has more than 13 million Medi-Cal enrollees.
"If you undermine Medicaid in any way, it would really disrupt the [healthcare] market," said Hernandez. "You have literally half of the people in places like Fresno County covered by Medi-Cal, and changes to the program could have a major impact on the state."
A report from the California Budget and Policy Center estimates that Tulare County has the highest percentage of residents enrolled in Medi-Cal, at 55.5%, followed by Fresno County at 49.9%.
Levitt said Republicans have proposed a plan that would modify Medicaid using a block grant system that would potentially reduce funding for Medi-Cal. Other proposals call for rolling back or reducing spending for Medicaid expansion.
If the new administration were to water down segments of federal healthcare reform by revising Medicaid expansion and reducing or eliminating federal subsidies, it would have a major impact on California and its estimated 5.5 million newly insured residents.
Medi-Cal alone could lose $16 billion in federal funds, advocates say.
California healthcare policy experts say it is too early to tell what impact the policies of President-elect Donald Trump will have on the Affordable Care Act (ACA), but they agree the ACA is unlikely to remain intact.
Although Trump vowed to "repeal and replace" the ACA during his campaign, a wholesale repeal of the ACA is unlikely. Any legislation to do so would probably have to override a Democratic filibuster and would require 60 votes in a Senate that includes only 51 Republicans.
Therefore, policy experts expect the new administration to take a piecemeal approach to dismantling the Act by reducing federal funding for it.
If the new administration were to water down segments of federal healthcare reform by revising Medicaid expansion and reducing or eliminating federal subsidies, it would have a major impact on California and its estimated 5.5 million newly insured residents.
"California is currently receiving $20 billion in federal funds each year for Medicaid expansion and federal subsidies," said Micah Weinberg, president of the Bay Area Council Economic Institute.
"That includes about $15 billion to $16 billion for Medicaid expansion and $4 billion to $5 billion in subsidies."
Proposals made by Trump and House Speaker Paul Ryan would dismantle many elements of healthcare reform, according to a policy brief from advocacy group Health Access California. "Dramatic rollbacks in healthcare and coverage are at the top of the agenda of both President-elect Trump and Speaker Paul Ryan, who has reiterated long-standing plans to cut Medicaid and Medicare," the brief stated.
Many of those changes, as well as repeal of many elements of the ACA, could be passed through budget reconciliation, which only requires 51 votes in the Senate, a majority of the House, and the President's signature, the brief noted.
"Californians should be alarmed by repeal proposals that would, among other rollbacks, cut $16 billion from our Medi-Cal program in just two years, forcing elimination of coverage for more than 3 million Californians," said Anthony Wright, executive director of Health Access California.
Any plan to reduce funding for Medicaid expansion or federal subsidies could have a major impact on state residents who gained coverage under healthcare reform, potentially making that coverage unaffordable, Weinberg said.
"There are a range of proposals on the subsidy side, which include a tax credit or less generous subsidies," he said. "It's just a matter of how much of the $20 billion federal spigot will be turned off."
California doesn't have the financial capacity to backfill the proposed federal cuts to health insurance subsidies or the cuts proposed for public plans, according to California Insurance Commissioner Dave Jones.
"In California, the ACA has enabled us to provide health insurance to 5.5 million additional Californians through Medicaid expansion and another 1.4 million Californians have health insurance through our exchange, Covered California, of which 90% receive a reduced premium thanks to ACA subsidies," Jones said.
The percentage of California residents without insurance had dropped to 8.6% at the end of 2015, according to the U.S. Census Bureau. Census data estimates there were 3.3 million state residents without insurance at the end of 2015.
A report from the Urban Institute released this month cited a study from the Committee for a Responsible Federal Budget that estimates the number of uninsured residents would increase by 21 million, to a total of 50 million nationwide by 2018 if the ACA is repealed.
In California, the report estimates the number of uninsured would more than double to 7.5 million by 2018.
Starting next year, hospitals and other facilities must conduct workplace assessments and violence prevention training.
California state officials approved regulations that will require healthcare facilities to develop violence prevention programs in 2017 to safeguard workers.
The regulations will require hospitals to create violence prevention programs and train employees to follow protocols. The regulations were approved by the state's Occupational Safety and Health Standards Board and are supported by the state's two largest healthcare labor unions.
However, the California Hospital Association has raised concerns about the logistics of the program and how hospitals will pay for it.
The regulations were adopted after two years of negotiations between the California Division of Occupational Safety and Health (Cal/OSHA) and the California Nurses Association and the Service Employees International Union-United Healthcare Workers West.
"California has set the bar with the strongest workplace violence regulations in the nation," said Bonnie Castillo, the CNA's director of health and safety.
Under the regulations, hospitals and healthcare facilities will need to conduct workplace assessments and implement violence prevention plans with input from employees. The standards will require training to help employees assess risk factors for violence involving patients or visitors and identify problem areas.
Hospitals and facilities will not be held responsible for every act of violence in the workplace but could be cited by Cal/OSHA for not following protocols.
The regulations are slated to go into effect in early 2017, but the timing will depend on how quickly they get through the final approval process, said Julia Bernstein, public information officer for the California Department of Industrial Relations.
The standards must still be approved by the state Department of Finance and the state Office of Administrative Law.
CNA and SEIU members in 2014 petitioned Cal/OSHA to adopt stricter standards to protect healthcare employees in the workplace. The petition cited the death of a psychiatric nurse who was killed by a patient at Napa State Hospital in 2010, an incident that union members said demonstrated the need for better security measures.
The U.S. Bureau of Labor Statistics estimates that violent incidents involving workers are four times more common in healthcare settings than in other industries.
The CHA lauded the intent of the regulations. However, Cal/OSHA has underestimated the fiscal impact of the regulations, which will require initial training and studies to develop violence prevention protocols and training on an ongoing basis for new employees, said Jan Emerson-Shea, the CHA's vice president of external affairs.
"I think the original estimate for initial implementation statewide was $36 million and another $25 million for new training and annual reviews," said Emerson-Shea. "Considering the state has more than 400,000 hospital employees, we believe Cal/OSHA is grossly underestimating those costs."
The West Contra Costa Healthcare District filed for Chapter 9 bankruptcy protection after a deal to sell hospital property to a hotel developer fell through.
The West Contra Costa (CA) Healthcare District announced its Chapter 9 filing October 20, nearly 18 months after the district closed Doctors Medical Center in San Pablo following years of financial problems.
In early 2016, Royal Guest Hotels, a boutique hotel operator, agreed to purchase the former Doctors Medical Center building and adjacent property for $13.5 million. But Royal Guests pulled out of the sale in September.
"The West Contra Costa Healthcare District board of directors was left with little choice but to file for Chapter 9 bankruptcy due to the recent decision by the prospective hotel developer, Royal Guest Hotels, to cancel their agreement to purchase remaining district property," said West Contra Coast Healthcare District Board Chairman Eric Zell.
The filing would allow the district to meet its remaining financial obligations to workers and business partners, Zell said.
"With no chance to bring in revenue in the short term to cover existing district expenses, such as workers compensation and medical record storage, the district board voted unanimously to file for bankruptcy to allow for the orderly disposition of remaining financial obligations, including those owed to past district employees and vendors," he said.
The Chapter 9 filing is not a complete surprise. Bankruptcy was mentioned as a possibility in a report released in August by consultant Berkson Associates.
The study examined several options for the future of the healthcare district that included reorganizing as a subsidiary district or shutting down. The West Contra Costa Healthcare District was running a budget deficit of $20 million at the time.
"Because the District no longer operates a hospital—the primary purpose for which it was formed—and does not provide any other health-related services, it is a candidate for dissolution, consolidation, or reorganizing," the study stated.
West Contra Costa is the third healthcare district in the state to file for bankruptcy in the last nine years, said Amber King, senior legislative advocate for the Association of California Healthcare Districts (ACHD).
"It's not common, but we have seen a few bankruptcies in the past decade due to problems like reduced reimbursement rates that are putting a strain on smaller hospitals," said King. California is currently home to 85 healthcare districts.
In 2009, the Sierra Kings Health Care District filed for Chapter 9 bankruptcy. Mendocino Health Care District filed for Chapter 9 bankruptcy in 2012. Palm Drive Health Care District filed for Chapter 9 bankruptcy in 2014 with the closing of Palm Drive Hospital, which later reopened as Sonoma West Medical Center.
The West Contra Costa Healthcare District formed in 1948 and operated Brookside Hospital from 1954 to 1997. In 1997, Tenet Health purchased Brookside Hospital and renamed it Doctors Medical Center San Pablo.
The district took over Doctors Medical Center in 2004 and operated it until April 2015, when it was closed due to revenue shortfalls caused mainly by a decrease in patient volume and a high percentage of Medi-Cal patients.
