This year's List of L.A. County-based hospitals, ranked by number of beds, shows that occupancy rates have dropped even while the number of beds has been dramatically cut.

Fifteen of the 25 largest hospitals saw a drop in their occupancy rates in 1996, while only seven saw their occupancies go up.

The large portion of hospitals with lower occupancy rates is noteworthy considering there were 1,324 fewer beds in the 25 largest local hospitals in 1996 than there were in 1995.

Industry sources pointed to a number of factors for this, most notably recent advances in medical technology and the further shift of the industry into managed care.

Both factors lead to an increase in outpatient care and shorter hospital stays.

"The traditional hospital is becoming somewhat of an anachronism," said Jim Lott, senior vice president at Healthcare Association of Southern California, a trade group that represents hospitals and physician groups. "More and more (medical treatment) could be done on an outpatient basis."

While having fewer people in need of hospitalization may be good news, it is not necessarily good for business.

To make up for the lighter hospital patient load, said Lott, many hospitals are now looking at ways to diversify.

"Hospitals will merge with larger integetrated groups," Lott said. You'll see "more outpatient services, agreements with physician groups and a rise in skilled nursing."

The most dramatic example of the industry's shift to outpatient care is provided by the county's Department of Health Services.

Case in point: Los Angeles County-USC Medical Center, which despite its place as the largest hospital on The List, has been aggressively cutting its number of beds.

Its number of licensed beds dropped from 2,045 in 1995 to 1,779 in 1996, but even those cuts were not enough to stem the facility's drop in occupancy from 72.7 percent in 1995 to 56 percent in 1996. That means nearly half of the beds at County-USC are empty on the average day.

The Department of Health Services is responding to that situation by pushing for the proposed County-USC replacement hospital to have just 750 beds.

So far, the proposal by DHS for a new 750-bed replacement hospital has been met with resistance by the Board of Supervisors, which is expected to deliberate on the matter in the coming months, according to Fred MacFarlane, a DHS spokesman.

Another county facility with dwindling occupancy is Martin Luther King Jr.-Drew Medical Center, which went from a 50 percent occupancy rate in 1995 to a 44 percent rate in 1996.

The facility that dropped the most in the rankings is Rancho Los Amigos Medical Center, which went from No. 5 last year to No. 17 this year.

The rehabilitation facility's number of licensed beds in 1996 (436) is 286 fewer than in 1995. Those cuts were made to help alleviate the county's severe fiscal crisis, county officials said.

Still, some hospitals showed a healthy rise in business.

Providence Saint Joseph Medical Center, No. 13, experienced the most dramatic improvement in occupancy among the 25 hospitals, with its rate rising from 52 percent in 1995 to 65 percent in 1996.

The hospital with the highest 1996 occupancy rate is Cedars-Sinai Medical Center, No. 3, which had 76 percent of its licensed beds occupied on the average day in 1996.

The two Veterans Administration hospitals also posted relatively high 1996 occupancy rates. The West Los Angeles facility posted a 71.2 percent occupancy and the Long Beach facility posted a 65 percent rate.

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