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California hospitals struggling to finance costly seismic safety upgrades

by Christopher A. Guzman, published

Besides beaches and pleasant weather, California is also notorious for its occasional earthquakes.  When it comes to California hospitals and earthquakes, the legislature considered it of paramount importance to implement a series of regulations to ensure that hospitals were equipped for the safety of patients during critical times.

Retrofitting regulations began shortly after the Sylmar quake with the Alfred E. Alquist Hospital Seismic Safety Act (1973). The legislature allowed a 25 year window for hospitals to get up to date with state standards.  When the Northridge quake hit in 1994, hospitals built complying with the Act sustained moderate damage while those cited for violations were buildings constructed before the Act.

With the Act’s (SB 1953) expansion, regulations became stricter, requiring that hospitals be seismically evaluated. It required buildings to survive earthquakes without even posing the most modest threat to individuals.  In 2001, a committee found that approximately 40% of hospital buildings still didn’t meet safety standards.  According to the same report detailing past earthquake regulations on hospitals, it also stated that the source of funding for keeping up with regulations was not very clearly delineated.

Whether the funding comes from hospitals or from the state was not very clear.  Fast forward to 2010 and workers within the medical industry are wondering the same.  Prominent experts within the medical field don’t deny that hospitals need to be equipped in case of an inevitable earthquake. They’re wondering how to pay for it.

According to the report from California Healthline, deadlines to meet earthquake standards were extended to 2020 or 2030. The remaining problem is how hospitals are going to pay for this unfunded mandate given that the government is not going to foot any of the bill.  "The issue is not if hospital buildings should meet even higher seismic standards, but when and how the upgrades are financed and implemented,” said Roger Richter, senior vice president of the California Hospital Association.

Richter also said that the upgrades are costing a lot more than originally expected.  “When SB 1953 was enacted in 1994, the estimated cost to comply with this unfunded mandate was $14 billion.  In the intervening years, however, that price tag has skyrocketed -- and could be as high as $110 billion without financing costs by 2030,” he said.

That California has been cash strapped across the board--from the private sector to the government sector--has certainly compounded the obstacles in hospitals making needed repairs and upgrades.  The dilemma for the state is whether to shut down hospitals that do not meet safety deadlines, which would constrict the supply of medical help available to those who need services the most.

At the same time, there is the idea that it’s essential that buildings be safe if they are to house any patients at all. 

     “Nurses and other health care workers are at the front lines when devastation occurs. We cannot and will not be silent and allow legislators to continue to pass seismic extensions which permit many of California's largest corporate chains to avoid their responsibility to make their buildings seismically safe.  The devastation is real, death is real and in a seismically active state as California, we cannot continue to gamble,” said Zenei Cortez, Co-president, California Nurses Association/National Nurses Organizing Committee.

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