Burn Centers get funding boost for workers comp cases: Grossman facility led legislative fight to up reimbursement rates.

IT has taken more than three years and multiple legislative attempts, but Sherman Oaks Hospital's renowned Grossman Burn Center finally has gotten its way in how it's paid for workers' compensation cases.

Gov. Arnold Schwarzenegger has signed a bill carded by Assembly members Ed Hernandez, D-West Covina, and Mike Feuer, D-Los Angeles, that directs the state's Division of Workers Compensation to set higher reimbursement rates for the treatment of serious bum victims.

Reforms to the state workers compensation system in 2003, aimed at controlling runaway medical costs, had the unintended effect of significantly underpaying bum centers like Grossman, which treat the most costly and severe cases. Since many bums occur in industrial settings, workers comp cases historically comprised about a quarter of Grossman's caseload.

The lower fee schedule, based on what Medicare might expect to pay to treat an elderly burn victim as opposed to a younger worker, resulted in a 40 percent drop in reimbursements and a significant hit to the hospital's bottom line.

"Burn care is a very high-intensity, acute form of health care," said Dr. Peter Grossman, co-medical director of the center his father founded. "What we've seen over the last several years is a closing of bum centers throughout California and the nation because it's just not a profitable venture for most hospitals."

The Grossman center didn't close, but in the years it took to improve reimbursement rates other significant changes took place. Sherman Oaks Hospital, formerly a not-for-profit community hospital, was sold in 2006 to Dr. Prem Reddy's controversial for-profit Prime Health Services Inc.

Prime is criticized for its tough stance with labor groups and a practice of canceling contracts with health maintenance organizations, thereby creating a wealthier patient base.

Staff reporter Deborah Crowe can be reached at [phone], ext. 232, or at [e-mail].