Proposition 72 might not cure county hospital's financial ills

County and hospital officials are casting a somewhat cautious eye at Proposition 72, the November ballot initiative that would require mid-size and large employers to provide health care coverage to their employees.

Anne McLoud, finance director for San Joaquin General Hospital, said Proposition 72 money would help offset the $10 million deficit projected for the French Camp hospital this fiscal year.

But she said even if the proposition passes, the money coming in would probably not be very much.

"If there were 20 hospitals, they'd all be scrambling for a piece of the pie," McLoud said.

Under Proposition 72, employers with 50 or more employees would be required to provide health insurance and pay 80 percent of their employees' health care costs.

Companies with 200 or more employees would also be required to cover their dependents.

But requiring employers to provide health coverage for the working poor might not be the answer to the hospital's woes, McLoud said, because San Joaquin General's role is to help everyone, including the indigent.

Also, insurance companies, Medi-Cal and Medicare often don't pay for all services provided by a hospital, she said.

"It's service-provider driven," McLoud said. "Very few people pay full charges because of managed care and contracting."

Other times it depends on how many days a patient stays in the hospital or what type of medical procedure was done, she said.

Last year, the hospital paid $44 million for indigent services, McLoud said.

Still, Supervisor Steve Gutierrez said whatever money comes in through Proposition 72 could help the hospital.

"Every little bit helps," he said, "especially when we're hurting so bad."

But he said the problem lies with medical costs.

"What is driving the cost of health care?" he asked. "Why is it so outrageous?"

He said what's needed is price controls.

The other problem with San Joaquin General is its image, and cuts that could hurt services, Gutierrez said.

The hospital has a stigma because it's often seen as the hospital where the indigent go for treatment, a perception that needs be changed through marketing, he said.

In April, more than 130 positions, including the marketing director, were cut at the hospital. Although most of the positions cut were part time and done through attrition, McLoud said, Gutierrez wondered what type of affect it had on the hospital.

"But we need people with health insurance," he said.

While some see the initiative as a small lifesaver in a vast sea of red ink, Supervisor Jack Sieglock said Proposition 72 probably wouldn't help the hospital because the problem is people who use Medi-Cal or Medicare.

And he questioned if later the initiative would require employers to provide state-run insurance.

"I don't think it's the solution," he said.

Pat Patrick, president and chief executive officer of the Lodi Chamber of Commerce, said the initiative would effectively put a new tax on business. Paying 80 percent of employees' health care coverage "is a terrific added expense," he said.

The problem isn't whether employers provide health care but rather the high cost of insurance, Patrick said.

"What's making health care so expensive?" he asked. "That's what we need to deal with."

For advocates for the homeless and those dealing with the working poor, Proposition 72 is long overdue.

At the Homeless Shelter of Stockton, Cecilia Jacobs, director of client services, said the majority of working families have no medical coverage through their jobs. Most only go to the hospital in dire situations and instead turn to the Channel Medical Center or St. Mary's clinic next door.

Medical coverage for the working poor often means cough syrup, aspirins and bandages at the shelter, she said.

Or they'll take a dose of their uncle's penicillin that's probably out of date, Stella Kitcher, senior case manager with the Central Valley low-income housing, said. Other times it's the difference between food for the family or caring for a sick child, she said.

Even county employees are put in that situation, said Angel Picon, field representative for Service Employees International Union Local 250. For example, to qualify for the county's insurance, an in-home support worker has to have at least 60 hours for three months, he said.

While some of the county's 5,000 in-home support workers have insurance through their spouses, many don't qualify and aren't insured, he said.

And even if they qualify, some, such as single parents, often don't put their children on their medical coverage because of the cost, said Michelle Blau, field representative for SEIU Local 790, because the county requires that the employee to pay 20 percent of the premium to cover a dependent.

While employees are covered 100 percent by the county, Blau said dependents are not. And for a single parent, the cost of dependent coverage could be $250 per month, she said.

County Administrator Manuel Lopez said the county spends $8,340 per year for each of the 5,900 county employees who have health care coverage.

And if an employee includes a dependent, the premium would rise and so would the total amount, he said, although they would still pay 20 percent.

Contact reporter Les Mahler at lmahler@sjnsnews.com.