Talk of Settlement Enters Hospital Equation

The Citizen

A legal compliant is always a good way to coax a settlement. That’s what Sutter Health is bargaining after filing suit in Alameda County Superior Court for the transfer of San Leandro Hospital from the Eden Township Healthcare District. Sutter is also seeking damages in excess of $5 million.

Sources tell The Citizen, Sutter, the District and the Alameda County Medical Center (ACMC) are exploring a three-way deal that would keep San Leandro Hospital open as an urgent care facility with emergency room services. Sources also say there is the possibility of another local hospital running San Leandro Hospital. It is unclear, though, the length of any possible deal.

Most agree any future plan for San Leandro Hospital would entail an annual subsidy of between $4-7 million. According to a person with knowledge of the negotiations, each entity would contribute up to $1.5 million. In past months, similar proposals have been made through Alameda County Health Services (ACHS) and Alameda County Supervisor Alice Lai-Bitker. The missing part of the equation is how long such a plan would run.

Critics have long charged the District with making a poor agreement with Sutter in 2007 which only kept the hospital open for another two years. A similar deal to continue ER operations in the short term may only extend the inevitable closing of the hospital in the near future.

Alameda County Health Services Director Alex Briscoe has long maintained the hospital needs a long-term solution that includes a subsidy annually-adjusted for inflation but said, “We have yet to see a plan to keep acute care services at the hospital.”

Briscoe said the District should divest itself of its undeveloped property in Dublin to fund San Leandro Hospital. “The District has assets of $120 million,” he said. “Why do you need a health care district if you don’t have a hospital?” San Leandro Mayor Tony Santos also told The Citizen he agrees with such a plan to fund the hospital.

According to sources, the current vacancy on the District Board of Directors is making negotiations with Sutter and ACMC difficult without a clear consensus from the board on a direction to proceed. The current board of four is believed to be split with those wanting to keep San Leandro Hospital open with emergency room services and those who support Sutter and ACMC’s plan to convert it to a acute rehabilitation facility.

Briscoe said he was aware of Sutter’s complaint against the District and said the health agency is concerned about the suit and the possibility it could become a drawn out affair. “I haven’t read the lawsuit, but I know Sutter’s position,” said Briscoe. “They believe they signed a deal that gave them the right to a purchase option and they acted upon it and they think the District is breaking the law.”

“The District signed a bad deal to keep it open for a couple of more years,” he said. According to Briscoe, the District’s own legal counsel Frank Cannizzo told ACHS any legal challenge to the 2007 Memorandum of Understanding was slim, although some members of the board have privately expressed uncertainty over some of his previous legal opinions.

As to suggestions Sutter would pull up stakes at Eden Hospital, Briscoe would not rule it out, but believes it is highly unlikely given the Board of Supervisors approved the Environmental Impact Report in June. “I can’t speak for Sutter, but I don’t see any reason for them to leave Eden,” he said. “There’s no impediment stopping them now from building.”


2 thoughts on “Talk of Settlement Enters Hospital Equation

  1. Good point. This was not the first time Alameda County Health Services Director Alex Briscoe has told me this. Two months ago, Cannizzo told him the chances of success were only “one in five.” Whatever that means.


  2. How does the District's atty, Cannizzo, talk to the ACHS about any legal challenge being slim? Is he the atty for the District, ACHS or Sutter? Is Cannizzo displaying a conflict of interest or outright subversion of District wishes and tactics?


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