Corporate Shenanigans, Greed And The Will To Fight Back

The issue of San Leandro Hospital and its six-year-long association with Sutter Health, along with the facilities possible closing has been a long and wild ride for health care workerS and a band of rabid community activists. Here is a timeline of events starting with the pivotal 2008 Memorandum of Understanding between Sutter and the Eden Township Healthcare District AND leading to this week’s ruling in Alameda County Superior Court:

FALL 2008 – Sutter Health and Eden Township Healthcare District agree to memorandum of understanding guaranteeing the rebuild of Eden Medical Center and allowing a two-year window for finances at San Leandro Hospital to improve. Many believe San Leandro Hospital is saved, but a group of nurses and doctors are wary of Sutter’s tactics at other Northern California facilities.

WINTER 2009 – Sutter makes overtures with Alameda County to close San Leandro Hospital and convert it to an acute rehabilitation facility to replace the seismically-deficient Fairmont Hospital. Critics rail against Sutter saying the corporation did not give the hospital time to improve its bottom-line. Others suggest Sutter negotiated in bad faith and had designs to close the hospital, thereby eliminating competition to its planned state-of-the-art hospital in Castro Valley.

MAY 2009 – Doctors, nurses and community activists flock to the Alameda County Board of Supervisors claiming their approval of the Eden Medical Center Environmental Impact Report, in effect, will lead to the closure of San Leandro Hospital.

Supervisor Nate Miley lambastes the group for turning the hearings into a discussion of San Leandro Hospital and not the EIR. Supervisor Scott Haggerty famously wads up a letter from the San Leandro City Council asking to save San Leandro Hospital and theatrically slams it in a waste basket.

Neither the city or the county has jurisdiction over the hospital. It rest with the Eden Township District Board of Directors and I’ve been involved with them for the past year. I have told them repeatedly, look, you folks need to come up with some alternative plan to keep this facility operating. It’s up to you — San Leandro Mayor Tony Santos says in May 2009.

JUNE 2009 – A Southern California hospital chain with a recent history of taking over bankrupt community hospitals tells a large group of residents at the San Leandro Library that Prime Healthcare can fix the hospital. Dr. Prem Reddy, the charismatic owner of Prime, gets a standing ovation from the throng, but Sutter wants no part of having San Leandro Hospital in the hands of a competitor known for playing hardball with insurers and labor groups.

The next day, the board of supervisors approve Eden’s EIR allowing Sutter to break ground on the project. Miley tells Eden CEO George Bischalaney to negotiate with Prime. He says yes, but the two groups never talk.

The entire District board is notified before a community hearing at the library they all may have a conflict-of-interest in any decisions involving the District and San Leandro Hospital. This issue will return with more focus a year later.

Supervisor Alice Lai-Bitker saying the county only approved Sutter’s plan to convert San Leandro Hospital to rehab when there were no other options, tells the third of heavily-attended public meetings at the library, that she will ask her colleagues to rescind the offer. Ultimately, Lai-Bitker does not have three votes on the board to make it happen–only Miley stands with her–and the plan dies.

They are going to try to do this deal with the county despite what you heard here tonight. I really don’t think this is over. There are factions in the county who want that to happen and they are lobbying for that to happen — Mike Brannan, California Nurses Association.

Assemblywoman Mary Hayashi, via video, tells supporters keeping San Leandro Hospital is her “number one priority.” She is never heard from again.

JULY 2009 – Sutter breaks ground on $320 million rebuild of Eden Medical Center.

Community awaits word on whether Sutter will announce the closure of San Leandro Hospital. It could be as early as Sept. 30, 2009.

Hayashi fails to vote for her own co-sponsored bill with rival, state Sen. Ellen Corbett, scuttling possible legislation that would have aided the hospital’s cause.

Corbett obtains a waiver from the state extending until 2020 the deadline for Fairmont Hospital to be seismically retro-fitted. The previous 2013 deadline was a talking point of those in favor closing San Leandro Hospital.

A “hybrid model” of various services at San Leandro Hospital gains steam. Lai-Bitker gives her support. The plan has drawbacks as county officials say an annual subsidy between $6-9 million is needed to operate the plan with a full-service hospital, rehab and surgical services. She asks the District for $2 million to keep the emergency room open. In the current economy, nobody has funds for such an expenditure.

Alameda County Health Services Director Alex Briscoe tells supervisors Sutter’s figures regarding urgent care at San Leandro Hospital is way off. As an argument against the need of the ER, Sutter claimed 80 percent of its patients could be treated in urgent care, the real figure is 59 percent, in line with other hospital of its size.

Sutter exercises its right to purchase San Leandro Hospital. This is not good news for supporters of the hospital.

The future remains in doubt, but you can surmise from Sutter’s action that they do not plan to run the hospital as a private operation facility — Alex Briscoe, Director of Alameda County Health Services

AUGUST 2009 – Sutter’s pricetag for San Leandro Hospital: $0.

The District votes to block Sutter’s attempt to purchase San Leandro Hospital. The move sets the stage for the dispute to head to the courts.

Sutter quickly unveils its agreement with the Alameda County Medical Center to lease San Leandro Hospital for acute rehab without owning the property.

Corbett announces she will ask the attorney general to investigate Sutter for a pattern of abuse of its non-profit status, medical redlining and misrepresentation to local healthcare districts. Jerry Brown’s office responds to call for investigation. A determination is never made on the case.

SEPTEMBER 2009 – Eden CEO Bischalaney threatens to call the sheriff after a low-key group of hospital supporters demand a chance to speak during a public meeting of the District board.

Sutter and the District agree to mediation of their dispute. Odd pattern of obfuscation regarding some boardmembers aligned with Sutter begins to emerge. Boardmember Carole Rogers is denied access to the mediation, while another member Dr. Walter Kran plan to ditch her in a cloak and danger farce.

OCTOBER 2009 – Kran abruptly resigns from the District board citing competing pressures from the District and Sutter. A long held belief Sutter had threatened Kran with legal consequences comes again to the front of speculation. The resignation, though, leads to the start of a dramatic change in the board’s demeanor from pliant to Sutter’s wishes to defiance. Search for replacement begins.

NOVEMBER 2009 – Sutter sues the District in Alameda County Superior Court for the right to purchase San Leandro Hospital plus $5 million in damages.

The District approves the candidacy of Dr. William West to replace Kran. The retired podiatrist is seen as a strong supporter of the cause to save San Leandro Hospital. He becomes a crucial majority vote on the board along with Rogers and Dr. Vin Sawhney. The board is now poised to take a more aggressive stance towards Sutter.

DECEMBER 2009 – Boardmember Dr. Rajendra Ratnesar, who is Sutter’s last consistent voice on the board, pens a “letter to the community” asserting those in opposition to Sutter’s plan are a vocal minority. Corbett, Rogers and Sawhney angrily denounce the missive. Rumors begin to swirl that Sutter is the real author of the letter.

Three days before Christmas, the purge of those suspected at the District of having loyalties to Sutter continues. The board agrees to fire its long-time legal counsel Craig Cannizzo, who stomps out of the meeting after having choice words with Sawhney. Raises eyebrows when he says he will not cooperate in any transition to the board’s new lawyers. Sawhney says he did not trust Cannizzo.

JANUARY 2010 – Lai-Bitker, citing stress, announces she will not seek re-election to the Board of Supervisors. Comments made by Sawhney in The Citizen regarding Prime spook Sutter into sending a terse letter threatening legal action if it attempts to negotiate with the District.

Busted! Invoice to the District shows a Sutter employee is the author of Ratnesar’s controversial December letter. Sutter denies it.

FEBRUARY 2010 – District’s lawyers say West, Ratnesar and Sawhney have potential conflicts of interests after working for Sutter sometime in the past year. They ask to be recused from decision regarding San Leandro Hospital and Sutter. A month later, Rogers is also found to have conflict leading to an archaic drawing of lots to fill future three-member negotiating parties.

MARCH 2010 – District files a countersuit against Sutter alleging the now-contentious 2008 agreement with Sutter is null and void due to a conflict-of-interest among two members of the negotiating team. If found void, the original 2004 agreement keeping San Leandro Hospital for 20 years would be reinstated.

After voting against the District’s majority to authorize the countersuit against Sutter, Rogers calls for Ratnesar to resign since he is also named in the suit. Ratnesar refuses.

APRIL 2010 – Cries Sutter losing money at San Leandro Hospital fall flat after they post profits of $700 million in 2009.

JULY 2010 – Sutter is accused of moving $156 million out of the Marin Healthcare District as it transferred control of the hospital to the District. Since 2004, Sutter has made a total $50 million in equity transfers from Eden Medical Center to its general operating fund. Eden and San Leandro Hospital operate under the same license making it impossible to discern whether profits were stripped from San Leandro, Eden or both.

NOVEMBER 2010 – Alameda County superior court judge rules against the District’s countersuit alleging financial conflicts during the negotiation of the 2008 agreement.

The District votes to appeal the ruling. No timeframe is known for the fate of San Leandro Hospital, but operations will continue for the foreseeable future.

Categories: Uncategorized

42 replies

  1. I will be discussing San Leandro Hospital on this week's podcast. I believe this issue is a story of our times. The power of corporations against the people. It's very important to see this distinction in this story.

    Whereas, the people as a whole in this country have failed in fighting back corporate corruption, activists in San Leandro are beating back Sutter victoriously or, at minimum, to a clear stalemate. It's a fascinating story.


  2. Lots of factual errors, opinion, rumor and innuendo. A clearly biased presentation in favor of one point of view. As usual, people will believe whatever tripe supports their own prejudices and to hell with the facts. Not worth further response.


  3. Correction to the above article.
    Dr. William West is an Orthopedic Surgeon and not a Podiatrist.


  4. Meet Dr. Rico, the only person in the world who wants San Leandro Hospital to close just so he can tell the rest of us, I told you so.


  5. Anonymous, Dr. Rico is not the the only person who would like SLH to close, count me with him. It is time to quit supporting the self serving do-gooders who have wasted more than a million dollars that would have been better served augmenting the needs of the patients instead of the lining of the lawyers and their staffs. Mel


  6. I can't believe anyone would want to see a hospital closed that serves so many people. What are they going to do when they go to Eden and have to wait hours to be seen or to get a room? They also don't care about ruining a city by putting a county facility – which will inevitably be badly run like the rest of the government – right in the middle of San Leandro. They must be Kaiser patients.


  7. Dr. Rico, and Mel: You are corporate vassals. You have sold your soul to Sutter because you lack a backbone in your body. Sutter has proudly announced it has made … was it 900 million dollars in net profit in 2009? Almost a billion dollars? And they are worried SLH loses 5-10 mil a year? In most likely “cooked books” accounting yet? Shame on you opining here while over 400 SLH employees face expulsion from their workplace some spent decades in, doing a great job, only to be sent out to pound the pavement, looking for a job in a tight belt economy? What is the matter with you, people? Where is your moral conscience?


  8. ok, to those who contributed to the demise of SLH, don't will still sleep soundly, laying flat on your nursing home/convalescent bed, nurturing your bedsores…you know who you people are, so, sweet dreams..


  9. Milo, your nom d'plume is curious. Your namesake had no conscience at all, selling to both the Nazis and the Italians. He is the perfect example of vertical integration of profit. What is wrong with making money in medicine? Or are you an adherent and advocate of the entitlement theory of healthcare? Karma, the folks who contributed to the demise of SLH are the very patients and board who allowed them in in the first place. May you reap your crop of drivel. Mel


  10. Mel, there is nothing wrong with making money in providing medicine to people, and Sutter Health is making lots of money doing so. However it is wrong to make money by denying medicine and healthcare to people. Sutter Health is a non-profit organization and pays no tax on the money they make. Just last two years they made over a billion dollars in profit. Why they are not investing that money back to the hospitals that need new equipments and upgrades? San Leandro Hospital is in dyer need of new x-ray machines, MRI machine, NM machine, patient beds and many other essential and life saving tools. San Leandro hospital can and will be profitable if Sutter Health wants it to be, but unfortunately that is not their intention.


  11. Sutter chose rich white people in Castro Valley and Dublin/Pleasanton over minorities and the working poor in San Leandro and Oakland. To Sutter, not everyone is created equal.


  12. I heard about judges ruling here in Germany on the 18th. Many knowledgeable felt this is what faced Board. All appearances are appeal will also fail and then what? Only way out is to negotiate. Keep hospital open as hybrid system. If all goes as is, County will own hospital and all loses. Dr. ratnesor was correct after all. How much will it cost to appeal? It is time to talk-in fact, it is past time.


  13. Half Mayor Santos, enjoy your trip to Germany paid by Sutter Health for your lack of leadership regarding San Leandro Hospital. Corrupt politicians like you are the main reason for this fiasco. You sold your hospital and your city for some worldly gains. You and Dr. Rico have no shame and no credibility to even talk about San Leandro Hospital. You both are the most loyal servants of Sutter Health in this entire community. Again shame on you , and your stinky souls.


  14. Anonymous how is it the Mayor or city councils fault?
    They have no say, SL Hospital is run by the Eden Health District not the City.
    Ask Cassidy to solve it, it isn't solvable by the City


  15. Mel, what exactly do you mean when you say
    “entitlement theory of healthcare?” When I get
    sick, and have no insurance, I will “theorize”
    about maybe, perhaps, how about going to a
    hospital? Is that it? Or you’re just making this up on the fly to elevate your missive a notch higher on sophistication scale?
    Healthcare is not a theory, it is an axiom;
    bedrock, like food and shelter. This is how our society exercises its humanity — by helping the sick. It is in fact against the law not to.
    Healthcare goes way beyond entitlement, sir. It is a moral duty, an obligation… So, what we've got here is a crooked corporation that has gone bonkers in its egregious, narrow-minded pursuit of profit, and it has in the process lost sight of its mission.
    I almost wish we do get that 7.0 shaker on
    Hayward fault so that the old Eden building is
    condemned, SLH is the only game in town, and
    Sutter has to eat crow and run SLH to its max
    capacity. Oh, the sight of that! Pat eating
    crow… All right, he may have hollandaise on the side and an order of fries with it. He’ll need it… Tums. I do recommend Tums. Just in case…
    Oh, yes, and did I say Sutter is shortsighted, too? Uh, I can hear that rumbling sound deep in the ground. Pull out your dutch oven, Pat.
    PS: I like Jon Voight. No need to get too smart
    about it.


  16. John, of course Sutter chose rich white people over minorities and the working poor.
    People are not created equal, except for their right to sleep under a bridge when life is tough. If you believe that Sutter is a not for profit, you are a bigger fool than I thought. When minorities and the working poor get together then there will be change for the better. There will not Sutter Health Care, though, as it will have packed up and reinvented itself somewhere else, leaving the citizen working poor with the property. Close SLH, join Kaiser, quit grousing and demand that the Eden Board quit wasting money. They have already wasted more than a million dollars just to keep them rich. Mel


  17. Ayn Rand's pure capitalism is a utopia just like Lenin's communism. Neither has panned out, neither works in real world. Welcome to the World 2.0, Mel.


  18. Sadly, but it is our reality, our Country has not agreed that non-emergency health care is for all and so far we have not been willing to pay for it either. Sutter, Kaiser, Blue Croos, Anthem are not Government agencies they are private entities, get over it and do not expect them to act like a public entity. Why would any private provider choose to mainly serve those without insurance or even medical clients, it is not a very successful model for long term success.


  19. If you live in San Leandro and have a heart attack… San Leandro Hospital is full (like last night) amd the ambulance has to take you to Eden Trauma (like last night)is also full – then you get to go to Washington Hospital ER -who told the EMT's to keep their patient in the ambulance until they had room for them in thier ER. This happened there for 30 minutes last night.
    Get real community! Is that you?


  20. Then you are at Highland Hospital in the Emergency Room and get over the loud speaker a “code grey” – “Emergency Room #1” (This means a person out of control) It happens at least once a day. Then you hear “Code Silver” which means there is a gun aimed at the staff.
    Is this what you want in San Leandro?


  21. “Why would any private provider choose to mainly serve those without insurance or even medical clients, it is not a very successful model for long term success. “
    It's called being exempt from taxes and responsibilty for charity care. Tax breaks amount to millions.


  22. All you morons including Mel, who thinks it is not Sutter Health’s responsibility to keep San Leandro Hospital open, is beyond stupidity. Lets go back and recall the reasons for which Sutter Health put forward regarding the closure of the hospital. First they said, “ 80% of the emergency room patients need urgent care not critical care.” This lie was debunked by the independent reporters and by the Emergency room doctors. Then they said, “ we are loosing money and there is no one who will buy this hospital.” Prime Health Care came forward and promised not only to buy it but also invest $20 million to upgrade the facility. Why Sutter did not let Prime Health Care to take over this money losing property. If it is not sustainable for Sutter Health then they should let it go. Let some one else operate the hospital for the community. You pin heads may want to come by to the hospital and talk to people who worked here over 30 years and asked them what is really going on. Forth floor of the hospital has been closed for the last 4 years. Many profitable procedures has been moved to Eden Medical Center. There are many other actions has been taken by Sutter Health to make this facility loose money on purpose. Sutter Health wants to close this facility, one to avoid helping the poor and non-insured. Second to eliminate any competition to its $300 million luxury hotel in Castro Valley.


  23. Oh the hell with it. It closes you go to Eden, it's a short drive. Or you go to the County or Kaiser. Enough of this grandstanding.


  24. Manuel, well said. Mel


  25. First Mel is your last name Ricco ???, If not its hard to believe there are to worms out there, and to all the rest of you who have some unknown reason to see San Leandro Hospital close, get a life, and when you need emergency care come to San Leandro Hospital and we will help you keep it. Manuel says go to Eden, well for your information Manuel, having a heart attack, or stroke, means you need help right now, and every second counts to whether you live or die or wind up a living vegetable, so if you want to gamble your life with the extra time it takes to get to Eden which will be overflowing should San Leandro Hospitl close well go right ahead but dont expect the rest of us to be as ignorant about medical care and necessity as you are. Yes I do work at San Leandro Hospital, and I am also a Heart Attack survivor, thanks to the Excellent care I received when I had a Heart Attack. So my advice to all who want to see the Hospital close, just gamble with your own lives not mine or anyone elses, and even if the Hospital stays open, and you have a Heart Attack, just tell the ambulance driver, no hurry take me to Eden. Its time for anyone who cares about quality care, lets all get together and tell Sutter they will not determine our lives and future by closing San Leandro Hospital, and if you havent already guessed. This is PAPA JOHN.


  26. Papa John, Don't San Leandro residents who have Kaiser have to go to Hayward, Oakland, Fremont or Pleasanton? All of which are further than Castro Valley.


  27. Yes Manuel, good point…I have to go to West Hayward or North Oakland to Kaiser for emergency services. And a large portion of San Leandro is just as close to Eden as it is to San Leandro Hospital, at least in the time it takes to get there via freeway vs. surface streets. Not saying SL Hospital should close though. Not sure that is the best solution for our community.


  28. Papa John. You are such a buffoon! I have never advocated closure of SLH because I never wanted to close it. In fact when I was involved in the negotiations for the new hospital, we got Sutter to agree to keep it open and additional 24 months! Without that they would have terminated the lease and given it back to the District which did not have the resources to operate SLH with the losses it was suffering. And I am NOT Mel, you jerk. I'm sick of your groundless accusations that are based on your ignorance and paranoid suppositions.


  29. Thank you Dr. Rico.


  30. rico, manuel and mel : yes, let SLH be closed, as you three pigs wanted…life will go on, definitely..just as karma will knock on your doors..


  31. Manual, Mel, and Rico are like “ding, dong, and ding.” There isn't a more noble cause for the the Eden Hospital board to spend their money on than SLH! The health of the community depends on it.
    I live in Castro Valley, work, have health insurance, and use Eden Hospital as my main hospital. But, I would never wish the removal a a functioning hosptal/E.R. from any community. That's just plain immoral.
    Rico, go back and read your Hippocratic Oath, I know it's been a looooong time since you engaged it. Hell, take an Aricept if it helps!
    Mark Phillips, Castro Valley
    PS Karma is correct. 😉


  32. Life will go on you fools. Where do you think the people who currently go to San Leandro Hospital will go? Think they'll disappear? No, they will go to another place just like you and me. Eden ISN'T that far away you morons. And yes, Karma has bit all of you on your butt and took away your brain.


  33. Hey Rico, you blooming idiot, since you want to start calling names, why did you attend all of those meetings and sit right in front of me and show your total ignorance of what is good for the community and what is not. I think when you started loosing your hair some of your brain matter went along with it, you are supposed to be intelligent yet you resort to name calling since you have nothing of worth to say, it shows total ignorance when you do that. I shut you up a number of times already so why dont you just give up, everyone knows you are a complete loser, losing out in the elections to be part of the board twice, I guess it kind of makes you feel unloved and unwanted, and I am sure after knowing you that is the case, I never heard you even once say anything in favor of keeping the hospital open. What an ignorant man you are, everyone knows your just a sore loser. PAPA JOHN


  34. Scary what Mel pointed out, that “..patients and board allowed (the demise of SLH )..”. So, blaming the patients for this hospital's closure just shows what kind of entity this mel is.


  35. OK Phillips, look up Hippocratic Oath and you will find that is has not been required since the 1870's. Furthermore there have been innumerable revisions and versions to adjust it to current times and cultures. It has some controversial provisions that run contrary to modern ethical thinking. Finally, I never took the oath as it was not required and I personally objected to some of its proscriptions.


  36. Hay Papa John! Who called me a worm? If you are going to hurl personal insults you should not object when your target fires back


  37. I agree with the comment regarding tax breaks. These “non-profits” gains this nametag because of the advantage they get. The trade-off is helping those who may be without health insurance. These bastards are dipping twice into our community pockets.

    It's a also ridiculous Rico would say he never advocated the closing of the hospital yet he keeps spouting conservative drivel that a hospital that doesn't make a profit should be allowed to close. Go Papa John!


  38. The mission to serve the underserved by not for profits is often superceded by senior management's and the Board of Director's desire and goal for more profit and net income. The mission the citizens deserve that is mandated by the not for profits charter can only be enforced by our Government as an agent representing the citizens and the citizen's tax dollars. I am not sure the not for profit is even an entirely valid model for public service by private entities. This is not to be confused with non profits, an entirely different entity.


  39. Just out of curiosity Dr. Rico. What provisions of the Hippocratic Oath do you find objectionable?


  40. Hey Rico…didn't you graduate from medical school in the 1870's?
    Mark Phillips, Castro Valley
    PS Sorry Frankie Boy, you set yourself up for that one. Open mouth, and insert FOOT!


  41. Barry, I suggest you read the explanation of non-profit and not-for-profit organizations on Wikipedia. You will find that they are one and the same thing. Two names for the same thing!

    Both Eden and SLH provide care to many patients for which they receive absolutely zero compensation.

    And do you really believe that the Government is the reliable agent representing the citizens and the citizen's tax dollars?” Considering that the county, the state and the federal governments are broke I find your faith in government naive at best.

    And Mark, you're so clever!


  42. Once again Dr. Rico; well said.


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