Marin General will not close,
but similarities in Sutter’s
 legal strategy is evident.

The operator of San Leandro Hospital, Sutter Health, last week happily agreed to meet with arbitrators in its lawsuit with Marin General Hospital. Like San Leandro Hospital, the facility is now run by the local healthcare district. Similarly, the community is up in arms over an allegation Sutter siphoned the cream off of Marin General’s profits from 2006-08 to the tune of $120 million before handing over the facility to the district.

For those who may believe in Sutter’s freedom to make money at any cost or whether their business dealings with local municipalities is honorable, check out the words coming from Marin. They sound eerily similar to remarks in the fight to keep San Leandro Hospital from closing. Not only do lawyers for the Marin Healthcare District sound confident of it legal strategy, but a Sutter spokesman uses the same language portraying the healthcare district of being ungrateful of their philanthropy. “We had hoped the agreement that was in place and the fact that we returned a higher quality and more robust hospital last summer would have brought an end to the divisiveness,” Bill Gleeson told the North Bay Business Journal.

Similar comments were made regarding San Leandro Hospital over the past two years by Sutter who constantly noted money on upkeep of the hospital. The Marin Healthcare District also alleges its former composition of boardmembers was infested with Sutter-appointed directors who greased the skids for Sutter’s cash grab starting in 2006. “Sutter was able make the ‘cash sweeps,’ as the suit calls them, by establishing a hospital board ‘with a clear conflict of interest,’ the suit says. The Sutter-appointed board consisted of Sutter-appointed employees who failed to fulfill their legal responsibility of protecting the financial interests of the hospital by knowingly allowing Sutter to make such transfers as the hospital became independent, the suit says,” according to the article. Of course, the implications that three members of the former Eden Township Healthcare District board had a conflict of interest with Sutter is what the entire countersuit filed by the District last March is all about.

The similarity in legal tactics by Sutter not only in Marin and San Leandro, but in San Francisco and Santa Rosa were one of the reasons lawmakers led by Sen. Ellen Corbett and Assemblyman Jared Huffman urged the state’s attorney general to review the corporation’s business practices with local healthcare governments. Jerry Brown is now governor and a new attorney general is in office. There is no indication thus far, Kamala Harris’s office will do anymore than Brown’s, which was very little.

Although a California Appellate judge ruled last week against the District’s writ of mandate, the appeals process continues along indefinitely. The upside: the hospital is far from closing, but far from a resolution.