La. hospital officials: Federal aid needed
(AP)
Updated: 2005-10-28 20:09

Southern Louisiana's only trauma center was shut down by Hurricane Katrina, and what is left of the rest of the hospital system is only a step away from financial disaster, the president of the New Orleans Medical Society said.

Hospital officials said Thursday that federal aid is needed quickly to salvage the state's public hospital system.

"The available hospital services are strained to their limits," said Dr. Patrick C. Breaux, the medical society leader. "We are one bus crash, major fire or flu epidemic from disaster."

Donald Smithburg, chief executive of the Louisiana State University Health Care Services Division, said earlier in the day in Washington that the public health system must furlough 2,900 of its 8,000 employees next week, the first step toward permanent layoffs on Dec. 17.

The public hospital system is Louisiana's largest health care provider with 1.2 million patients annually before the storm.

"We're out of money, roughly after Thanksgiving," Smithburg said in a speech to a conference of the National Association of Public Hospitals. "We are running out of time."

Two of the system's nine hospitals, Charity and University in New Orleans, have been closed since they were severely damaged in the storm two months ago. They are the system's two biggest hospitals and include one of only two trauma care units in the state. The other seven are scattered elsewhere in the state and remain open.

Smithburg stopped short of saying the system would have to close any more of its hospitals. To avoid closing them, Smithburg said the system is also trying to obtain deficit spending authority from the state legislature, which meets in a special session to address Katrina issues next week.

Hospital system engineers have declared Charity and University total losses, but Smithburg said the system is awaiting a final decision from the Federal Emergency Management Agency on whether the two facilities will qualify under federal disaster law for full federal funding of replacements, about $750 million.

The more immediate problem, he said, is the system's need for $15 million a month for the next six months to meet its payroll, and $200 million in interim financial support for the other seven system hospitals that have taken on additional patients because of the closures of Charity and University.

Because those seven were not directly damaged by either Katrina or Hurricane Rita, they are not eligible for FEMA grants.

Smithburg said he's hoping that both the payroll aid and the interim support will be included in a new hurricane relief spending bill being prepared by the Bush administration. He said he has pressed the issue with Louisiana's congressional delegation but has had little chance to plead his case with administration officials.

Congress passed emergency legislation earlier this month providing up to $1 billion in federal loans to local governments to enable them to continue paying essential employees. Smithburg said the public hospitals are not eligible for loans under that legislation.

But Sen. David Vitter, R-La., who helped shepherd the emergency loan bill through Congress, said he believes the public hospital system would be eligible for loans to pay essential personnel. Vitter also said the system's finances will be helped significantly if Congress approves a proposed expansion of Medicaid coverage for hurricane evacuees.

"We are seeing a domino effect as our Katrina- and Rita-related financial and personnel issues impact our other seven hospitals," Smithburg said. "With immediate help, we can keep the Charity system on its feet and continue to heal. Without it, Louisiana public health care will fall."