MLK Community Hospital leaders are sounding the alarm that the Los Angeles-based safety-net hospital may run out of money to pay bills as early as next year, the Los Angeles Times reported Nov. 10.
The hospital lost more than $42 million in the budget year that ended in June, according to the report. Hospital leaders said the funding system that includes supplemental payments for the state and county government has failed to keep pace with inflation and increasing labor expenses. The end of federal aid from the COVID-19 pandemic also added to financial woes.
The hospital has also been challenged by the fact that its emergency department has seen four times as many patients as initially expected when it opened, and Medi-Cal, the state's Medicaid program, does not fully cover the costs for providing emergency services, according to the report. The increasing number of patients added to expenses because mandated nurse-to-patient ratios required the hospital to hire hundreds more nurses. MLK was more than $20 million over budget for temporary labor last year, with the majority of that due to travel nurses.
MLK received a $14 million state loan for hospitals in financial distress, but CEO Elaine Batchlor, MD, told the news outlet that while the funding will help it make it through the winter, it does not fix deeper issues. The hospital's officials are urging Los Angeles county to increase payments to account for inflation. They are also asking the state to rework financial supplements and increase funding for emergency department visits.
Dr. Batchlor said that without changes the hospital will be forced to cut services and eventually close.