County OKs $4-Million Expenditure for Hospital : Health care: Funds will come from improved collections at King, an official says, but state legislators question whether the money actually exists.

The Los Angeles County Board of Supervisors voted Tuesday to spend $4 million at Martin Luther King Jr./Drew Medical Center to hire more nurses and correct scores of patient-care deficiencies in the hope of averting a Dec. 21 shut-off of federal funds to the beleaguered county-operated medical center in Watts.

But whether the funds actually exist was questioned by state legislators. State Assemblywoman Diane Watson (D- Los Angeles) called the funding “suspicious.” And state Sen. Bill Green (D-Los Angeles) testified that he and other legislators could not seriously press for support of the supervisors’ plan in Sacramento because “we’d look like a bunch of nincompoops.”

Richard Dixon, chief administrative officer, explained that the $4 million will come from King hospital itself--through improved billing and collection procedures that have yielded unforeseen revenue from Medi-Cal. The program reimburses the hospital for health care provided to low-income patients.

Additional millions for the hospital, Dixon said, might be realized if the hospital were able to collect on old patient accounts (dating back as long as four years) which were not billed to Medi-Cal in a timely fashion. County health officials have stated in a memorandum that this amounts to at least $16 million.

Both Watson and Greene blasted the idea of collecting on old Medi-Cal claims as absurd because Medi-Cal will not accept claims older than six months. And they said it was perplexing how the county could suddenly produce $4 million after months of protestations that the local health-care system is broke.

As recently as last January, county auditors sharply attacked fiscal practices at King “that hamper timely billing of accounts to third-party payors, and may result in lost revenues.”

Auditors criticized the improper shredding of cartloads of financial documents at King, and the unjustified write-off of about 1,000 cases worth about $4 million during 1987 alone.

Hundreds of other accounts were not correctly billed to the Medi-Cal program, jeopardizing another $1.2 million, the auditors reported. In some cases, clerks prepared phony billing documentation to make it appear that cases had been billed when they were not.

Until two months ago, King contracted with a private company to handle its billing operation. Auditors criticized hospital and health officials for “minimal monitoring of the contractor even though there were indicators that significant problems existed.”

Dixon said that county officials have spent “a great deal of effort” during the last year trying to improve billing practices at King, and “we are now seeing some legitimate fruit being born.”

He described the $4 million as “solid revenue” and urged that the money be set aside so that health officials can “proceed immediately to begin hiring staff, buying equipment and doing urgently needed things” at the hospital, which has been cited for major deficiencies in the area of nursing, dietary care, administration, infection control, quality assurance and physical plant. These and other problem areas were detailed in a series of stories in The Times.

If problems are not corrected by Dec. 21, the hospital stands to lose as much as $60 million in public health care funds from the Medicare and Medi-Cal programs.

Even as the supervisors struggled at their meeting to address problems in patient care at King, the president of the Los Angeles Chicano Employees Assn., Raul Nunez, attacked the hospital for its allegedly “discriminatory practices and policies” that have denied Latinos their fair share of jobs and promotions at the hospital.

He circulated a letter from the county’s affirmative action compliance officer, Robert Arias, charging that William Delgardo, former administrator at King, had “a complete disregard . . . for commitment to achieving a more equitable work force at his facility.”

Alan Clayton, a representative of the Mexican-American Correctional Assn., said 55% of the population surrounding King is Latino, but only 2% of the hospital’s top staff positions are held by Latinos.

“That’s not acceptable,” he said.

A 1985 letter from the county’s Commission on Human Relations, cited “extremely serious and potentially explosive” problems involving racial tensions between blacks and Latinos at King, Clayton said.

“Equal employment is something it appears they do not do at this hospital,” Clayton said.

Supervisor Ed Edelman asked county officials to investigate the matter.

BACKGROUND Federal officials have warned Martin Luther King Jr./Drew Medical Center that the hospital will lose about $60 million in public health care funds unless major patient-care deficiencies are corrected by Dec. 21. The hospital was recently cited for serious inadequacies in its nursing care, dietary services, infection control practices, quality assurance procedures and administrative functioning.