‘This Is It’ Says County Official Asking Healthcare District For $20M Subsidy To Save San Leandro Hospital

SAVE SAN LEANDRO HOSPITAL | Asking for a $1,000 loan from skeptical parents is one thing, urging a struggling health care district to pony up $20 million to save a hospital’s emergency room is another.

Sitting astride a lone office chair before the Eden Township Healthcare District Wednesday evening, the Director of Alameda County Healthcare Services Alex Briscoe did just that as time ticks away for various public entities to hash out a deal with Sutter Health allowing for transfer of San Leandro Hospital to Alameda Health System by a hard July 1 deadline. The deal reported two weeks ago, also includes a $22 million subsidy from Sutter Health to operate the hospital for one year.

Briscoe addressed the District’s skeptical Board of Directors urging them to contribute their own one-year, $20 million subsidy he and other county officials say will allow San Leandro Hospital’s emergency room to remain open, at least, another three years.

After years of legal wrangling and acrimony between the District and Sutter Health some of its board directors remain leery of returning to the bargaining table after so many false starts and breaches of trust among the groups now urging for a positive resolution to the hospital controversy.

District Board Director Lester Friedman was the most skeptical of the plan brought forth by Briscoe. In recent months, the District has grappled with a growing identity crisis following a court judgment that forced it to transfer title of the hospital to Sutter Health last year leaving the health care district without a facility to oversee. The District also provides millions in health-related subsidies to local non-profits. The struggling St. Rose Hospital in Hayward also rest within its jurisdiction. In one exchange Wednesday, Friedman said the proposal to contribute such a large expenditure would hinder its aid to both needy groups. “It would be over,” Friedman said of the District’s future.

“This is it. This is the moment to cut the deal,” said Briscoe adding, “I’m not sure they are there yet.”

The attorney for the District noted the request for subsidy from officials is far bigger than any other proposed deal over the past three years. “It’s a big, huge jump from where we were 6-8 months ago,” said Colin Coffey, the District’s attorney. Previous requests entailed a subsidy between $6-9 million annually to operate the hospital to a more amendable plan just six months ago calling for a 3-year, $3 million subsidy. Alameda County and the city of San Leandro also agreed to similar subsidy plans.

Briscoe, however, reiterated his concern the deal offered by Sutter is the best and last proposal remaining for the county and the community surrounding the hospital. “If this deal is not cut, we will be getting a closure notice,” Briscoe assured the board. “I truly believe that letter is written.”

When pressed by the board directors, Briscoe said the District is not part of the potential hospital deal and if they decline to contribute the $20 million subsidy, it could still be conceivably approved by Sutter Health and Alameda Health Systems. However, it also puts the likelihood of keeping open the emergency room in doubt. Alameda Health Systems also proposes using San Leandro Hospital as an acute rehabilitation center to replace the seismically-deficient Fairmont Hospital.

Later, while the District board was in closed session, Briscoe said of the deal, “This is it. This is the moment to cut the deal,” he said, but added, “I’m not sure they are there yet.”

Aside from Friedman, the other board directors were relatively silent (Board Director Dr. Vin Sawhney was absent). Board Chair Carole Rogers, however, queried Briscoe over the possibility of various stipulations, including the District offering the money contingent on need. Briscoe said he could not negotiate on behalf of Alameda Health Systems, formerly named the Alameda County Medical Center, but added after viewing Sutter’s financials, he believes the contention it lost $24 million over the past 2 years at San Leandro Hospital is “inflated.”

Just how the District could fund such a large, one-time subsidy is not clear. Briscoe offered three suggestions, including the liquidation of assets, sloughing off revenues from its real estate holdings or issuing additional debt. The first two appear untenable, said Briscoe. Selling off more than half of the District’s assets would trigger a state law placing the issue before voters. Ironically, this same issue was raised by Senate Majority Leader Ellen Corbett in the past against Sutter Health as a threat to block the transfer of the hospital. Briscoe said using future revenue streams from the District’s holdings is insufficient, but issuing debt on its three real estate properties would suffice.

Although the District’s three properties became financial albatrosses during the Great Recession, there is reason to believe the real estate market is improving. The Dublin Gateway Medical Center, according to the District, is its biggest asset worth $51.5 million. The San Leandro Medical Arts Building, located near San Leandro Hospital, is worth $5.5 million and its brand new medical office building in Castro Valley is a $6.5 million asset.

During a District meeting earlier this month, its CEO Dev Mahadevan noted the appraised value of the properties is on the uptick as are the number tenants signing leases at its medical offices. However, the District has borrowed against its assets in the past. Dublin Gateway has a loan value of $35 million, according to Mahadevan, while the Castro Valley medical office building is $45 million.

18 thoughts on “‘This Is It’ Says County Official Asking Healthcare District For $20M Subsidy To Save San Leandro Hospital

  1. San Leandro residents would die if they shut down our Hospital's ER. When seconds count, you can't afford to waste minutes more trying to get to another hospital. Besides, there are not enough ER beds in the other hospitals. How much is a life worth? What if it was your family member?


  2. A hospital is NOT a health and wellness program.These programs cost much less than acute care and are a more logical use of the Districts limited resources than a few months of operating costs of a hospital.


  3. The last anonymous comment follows a common but flawed line of thinking. Yes, Kaiser's new ER in San Leandro will not be able to refuse non-Kaiser patients. However, let us count the ways this access costs all of us:

    – If you have Kaiser insurance, you don't want the 27,000 patients per year who use the SLH ER crowding the Kaiser ER. The additional costs to Kaiser when they care for non-members, particularly in the very costly ER setting, will also increase the cost for Kaiser insurance.

    – The Kaiser Hayward ER will close when the Kaiser SL ER opens. The net ER capacity in the Healthcare District will not increase. The County already has fewer ER beds than it should; a SLH ER closure would turn a problem into a crisis.

    – Kaiser can and usually will refuse to see patients after ER discharge for their follow-up care. It is often best for patients to receive their ancillary care (Radiology, Lab, other outpatient services) at the same hospital which saw them in the ER; that will rarely happen for non-Kaiser patients using Kaiser's ER.

    There's a few other things bad about the let-the SLH-ER-close scenario, but you get the idea by now. Our anonymous friend is trying to polish a turd.

    Regarding their claim that “ETHD would provide a much greater contribution to community health by giving grants to committed, mission – driven organizations within the District”, two problems with that:

    – Acute care (full-service ER, ICU, Med-Surg) is much more expensive to establish that the community health clinics the commenter has in mind. If we had an overabundance of acute care services in the District, I might be inclined to accept this advice. Unfortunately, with the closure of the Vesper and Fairmont ER's and their attendant acute inpatient beds, we don't have an overabundance of acute services, so this advice is wrongheaded.

    – I can' think of a more “committed, mission – driven organization” than the County health system. Difficult public budgets and market forces have placed pressure on the Alameda Health System to seek profitable services, but this is primarily in an effort to help pay for the uncompensated and poorly compensated care which is the duty of the County. I'd suggest providing needed acute care services should be the duty of the Healthcare District as well. While I have sympathy for the difficult position the District Board is in, their decision should be a no-brainer if they care to accomplish the stated Mission of their District: “…to improve the health of the people in our community by investing resources in health and wellness programs that meet identified goals.”


  4. I'm with Les Friedman. if SLH were such a viable asset as an acute care hospital, it would have been snapped up long ago. ETHD would provide a much greater contribution to community health by giving grants to committed, mission – driven organizations within the District. Mr. Briscoe seems free to spend other peoples money on a hospital he knows cant make it. We will have another ED in the town when Kaiser opens. Everyone, you CAN go to Kaiser for your emergency care.


  5. Anonymous May 31st 10:42,

    Carole, Vin and the nurses and other SLH workers deserve a lot of credit. But it is the public who turned out in increasing numbers to County and Hospital District Board meetings when the big moments were at hand who provided the political pressure that saved the Hospital.

    Particularly in 2009, there were meetings where 500+ people showed up and spoke of their outrage about the deal the County was trying to make which would have closed the 24-hour ER, ICU and other irreplaceable acute services at SLH. The nurses and our best Board members would not have prevailed if the public had done anything other than exactly what they did, exactly what was needed, which was to make a big, BIG racket.


  6. Anonymous who says triad lost money is grossly inaccurate. Triad was pumping out profit before they left. They let SLH as they also left California all together because of not wanting to deal with California politics anymore. Get your facts straight.


  7. Alex Briscoe says Sutter's losses are inflated and everyone knows it stripped SLH are lucrative services. How would the Miami Heat win games if they traded Lebron James and Dwayne Wade to the Lakers? Same sitch.


  8. Excuse me. I worked for San Leandro Hospital when Triad ran it. It made a profit all the years that they owned it. Where are you getting your information? A Sutter lackey who does not live here and wont have to worry about having a heart attack living 5 minutes away – Instead of 15-20 minutes from Eden. You can turn blue in the face before you get to Eden.


  9. Every one blames Sutter for SLH losses conveniently forgetting that Triad also lost money running the hospital. This hospital just isn't economically viable and hoping and prying won't sustain it.
    Make it an urgent care facility and move on.


  10. Carole Rogers, Vin Sawhney and the nurses deserve all the credit for keeping the hospital open.




  12. The District reported after closed session to the public that it would “vigorously pursue” all of the avenues available to subsidize the San Leandro Hospital Emergency Room. A decision will be made at the June 19 regular board meeting.


  13. The District reported after closed session to the public that it would “vigorously pursue” all of the avenues available to subsidize the San Leandro Hospital Emergency Room. A decision will be made at the June 19 regular board meeting.


  14. Wilma is a loser. She thought she was going to the senate last time. Doesn't have incumbency of the assembly. Probably will be Skinner.


  15. All those lauding Wilma Chan …. will you still be giving her props when the ER closes after a year? Sounds like the County is only now pressing the Eden healthcare District. Even if SL Hospital stays open, seems like there isnt long term funding for the ER.

    Chan wont care because she will already be reelected and focusing on her State Senate campaign.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s