Hospitals face a conundrum with homeless patients. By law, a hospital must treat emergency situations, regardless of a person’s ability to pay. But what happens once the homeless person is out of immediate danger? Putting the person back on the street, a practice known as “patient dumping,” has prompted Los Angeles City Attorney Mike Feuer to file multiple lawsuits in the last two years against San Fernando Valley hospitals, including Glendale Adventist Medical Center and Pacifica Hospital of the Valley. Enter Hope of the Valley Rescue Mission. The nonprofit is building a Recuperative Care Center in Mission Hills, a homeless shelter that will specialize in recovery care for the homeless after discharge from hospitals. “It’s for people who don’t qualify to go into a standard shelter because of their condition,” said Ken Craft, chief executive at Hope of the Valley. “Here, we are staffed with medical personnel who can care for them and nurse them back to health before we get them another level of housing.” Formerly an airplane parts distribution plant, the 16,000-square-foot building at 11134 Sepulveda Blvd. was purchased for $1.6 million. Construction crews are building the interior so it can hold 30 beds for recuperative care, medical and mental health clinics, a community health clinic, housing and job placement services as well as a commercial kitchen that will provide a full culinary arts program for its residents and food for various Hope of the Valley locations. The community clinic, which will be open to the public, will be run by a federally qualified third-party medical provider that will rent the space from Hope of the Valley and treat the center’s homeless patients. The facility is set to open by the end of the year. In addition to the purchase price, Hope of the Valley has invested an additional $1.8 million into construction, bringing the cost of the project to $3.4 million. Hope of the Valley funded it through donations, which brought in around $650,000 plus an additional $400,000 in pledges, Craft estimated. The nonprofit organization secured a construction loan for the project, but anticipates that its fundraising campaign, which is in progress, will pay off the loan. Operating costs Hope of the Valley representatives declined to discuss the details of its operating costs, but did discuss how hospitals will contribute to the cost of running the facility. To admit patients to the Recuperative Care Center, hospitals will pay a service fee that is about 10 percent of what it would cost them to keep the patient in a hospital bed. The nonprofit will also implement a tiered system to determine what hospitals will pay daily for each patient. Covering a patient who is unable to perform activities of daily living will cost $300 a day, $200 will provide for a patient who can perform limited activities of daily living and $125 will cover patients who are stabilized. According to the Hospital Association of Southern California, homeless individuals stay on average four days longer than other patients while social workers and staff look for resources to help them. That translates to lost revenue for a hospital because a nonpaying patient occupies space that could be given to a paying patient. This, in turn, can increase prices for paying patients to counterbalance costs incurred from nonpaying patients. Allen Miller, chief executive at Cope Health Solutions, a health care management consulting firm in Los Angeles, said in an email to the Business Journal that the Affordable Care Act has helped some homeless individuals gain access to primary and preventive care, potentially reducing emergency-room visits. But holes in the system remain. “A significant number of homeless individuals are insured as a result of the ACA and Medicaid expansion,” said Miller. “However, few homeless individuals know they are insured, and an even fewer number of homeless individuals understand how to use health insurance to access the primary care and specialty care they need.” Despite health reform, homeless dumping remains a problem in the San Fernando Valley. Last year, Glendale Adventist had to pay $700,000 for dropping a homeless patient off on Skid Row in downtown Los Angeles. Kaiser Permanente has also had its share of legal troubles regarding discharge. In 2007, it agreed to a first-of-its-kind settlement requiring the managed care provider to implement more rigorous discharge procedures, more extensive employee training and oversight by a court-appointed monitor. Furthermore, the Affordable Care Act provides for a reduction in Medicare and Medicaid payments to hospitals if a homeless person is back in the emergency room within 30 days. “Hospitals have to come up with a solution that deals with the systemic issues of the homeless person’s problems,” said Craft. “If they take that homeless person and dump them back on the street and they have a relapse or an aggravated condition, then they are going to have to come right back to the ER.” Hope of the Valley aims to answer those problems and has already partnered with Providence Health & Services, which has locations in Burbank, Mission Hills and Tarzana; Dignity Health, with hospitals in Glendale and Northridge; West Hills Hospital and Medical Center, owned by for-profit HCA Healthcare; and Kaiser Permanente, which has several Valley locations. But Jennifer Bayer, vice president of external affairs for the Hospital Association of Southern California, said the Recuperative Care Center won’t solve the entire problem. “The thing about recuperative care is it is only successful for a segment of the homeless population,” she said. “There are many different types of homeless individuals, and there are many homeless individuals who will refuse to go into recuperative care or any follow-up service.” Bayer emphasized that homeless individuals must meet certain criteria to even be eligible for recuperative care, but added that this is a step in the right direction to combat homelessness, which she said should be tackled at a community level. Prior to Hope of the Valley’s Recuperative Care Center, the Valley had no facilities of this kind, highlighting the lack of community involvement and infrastructure when it comes to this problem. The closest recovery shelter to the Valley is on downtown’s Skid Row. Just transporting homeless people there can lead to some individuals refusing care because it’s out of their familiar territory, said Hope of the Valley’s Craft. “Hospitals are mandated to treat and stabilize anyone that shows up to the emergency room, but hospitals have few options when it comes to discharging homeless patients who simply need a place to recuperate,” said Cope’s Miller. Hope of the Valley’s new facility could also reduce the number of “frequent fliers,” homeless individuals that recurrently cycle in and out of emergency rooms, ultimately reducing hospital ER costs. “For the first time, many individuals will have the appropriate care to recover, recuperate and have access to an incredible array of services to end their homelessness and get them into permanent housing,” Jennifer Lopez, community benefit manager for Kaiser Permanente Woodland Hills, one of the hospitals partnering with Hope of the Valley, said in a statement. “(Hope of the Valley’s) ability to break the cycle of homelessness will be a welcome addition to the San Fernando Valley.”
