COUNTY/USC QUAKE AID SETTLEMENT AWAITS VOTE.

Byline: David Bloom Daily News Staff Writer

Los Angeles County is scheduled to get $409.8 million in federal earthquake money for four County/USC Medical Center hospitals under a proposed settlement to be considered Tuesday by the Board of Supervisors.

County officials said the settlement is crucial to plans to replace County/USC, one of the nation's largest and busiest hospital complexes.

The county originally had requested $1 billion for the damaged structures from the Federal Emergency Management Administration.

But, Larry Colvin, who heads the county Health Services Department team overseeing facility planning, said the settlement was a good one, considering federal budget limitations.

Preliminary discussions about how to spend the funds have centered around building a smaller hospital, reflecting the county's shift to providing more of its health care through outpatient clinics.

Supervisor Zev Yaroslavsky said the board also should consider purchasing an existing facility, or providing funding to other hospitals, which then could expand their services.

"The question is what do we do with it? We need to determine what we need and what we can afford," Yaroslavsky said. Other supervisors could not be reached for comment late Friday.

However, a spokesman for Supervisor Gloria Molina, who represents the district, said the FEMA decision was a welcome and important step toward rebuilding the hospital.

"This is a very critical facility that serves the entire Los Angeles County," said Michael Bustamante, an aide to Molina. "And this money comes at a critical time. We've been talking for months about how we need to proceed on rebuilding this facility. We're very pleased with FEMA's decision."

Colvin said new Health Services Director Mark Finucane already has ordered a review of the replacement hospital's size.

Finucane was out of town Friday and unavailable for comment.

County officials estimated that the hospital would be reduced from 988 beds to 788 beds in a recent application seeking a waiver of certain Medicaid rules. Under the waiver, the county would be reimbursed for more clinic costs.

FEMA money would cover more than a third of a new, smaller hospital's cost, with the state paying half the debt service of any remaining long-term debt, Colvin said.

A modern facility is estimated to save the county about $31 million annually, officials added.

County/USC provides an estimated 27 percent of all the trauma care in the county. It is the teaching hospital for the University of Southern California, and runs specialized treatment operations for burn or AIDS patients and others.