‘We have a problem on our hands’: Safety net hospital’s plight continues

Aman Dhuper, St. Rose Hospital president and CEO, addressing the Alameda County Board of Supervisors Tuesday afternoon.

The uncertain future of Hayward’s St. Rose Hospital, a safety net hospital serving a large number of Southern Alameda County’s Medi-Cal and uninsured residents, has vexed county and city officials for years. But the resolve for continually propping up the struggling hospital is beginning to show serious signs of fraying.

During an Alameda County Board of Supervisors meeting Tuesday afternoon in which a total of $9 million in matching federal funds was allocated to St. Rose, some county supervisors expressed great concern that St. Rose Hospital will eventually close it doors if a detailed, long-term plan for its survival is not created soon.

“I think we need a long-term plan for you guys,” Chan said, before adding, the hospital’s investment in 800 employees may not jibe with a half-empty hospital. “We have a problem on our hands right here, okay.”

Under state law, hospitals like St. Rose are required to undergo seismic retrofitting. “They’re going to have to rebuild the whole hospital. How are they going to do that?” Chan told her board colleagues. Without the reconstruction, she added, the hospital will be out of business.

Over the years St. Rose has suffered a significant reduction in its patient population mix with fewer patients using commercial insurance plans and more Medi-Cal patients, who are sometimes underinsured, along those who are entirely uninsured.

In addition, the hospital has faced rising labor costs, increased expenses, including supplies and pharmaceuticals. “We have been able to curtail that to a significant extent,” said Aman Dhuper, St. Rose Hospital president and CEO. County supervisors agreed with the assessment that St. Rose is running a significantly more leaner operation than years past.

But county funding is still required. Dhuper has asked the county for $16 million annually in recent years, while acknowledging the amount is less than what it needs. “We don’t want to burden the county with an increasing cost,” Dhuper told the board. “St. Rose Hospital is not in the business to make money, but to be able to provide the necessary care to all the residents of South Alameda County.”

In response to a question from Alameda County Supervisor Scott Haggerty asking Dhuper to justify why St. Rose needed $19 million this year, instead of $16 million in years past, the collegial tone of the conversation shifted to an uncommonly public display of indignation and annoyance by Dhuper toward the board.

“It could be misinterpreted that we are looking for a bailout. It could be misinterpreted that I’m using the county as a cash cow. It could be misinterpreted that I’m asking for my fair share of Medi-Cal reimbursement,” Dhuper said.

“But at the end of the day, let’s answers a simple question. Do you really need St. Rose? That’s a multi-million dollar question. Maybe [St. Rose] going away might solve all the problems. Maybe I don’t need to survive? I don’t know. I can control expenses to a certain level. I don’t know what more I can offer you. I can run a good hospital, but I can’t come up with magic.”

Haggerty, who represents Fremont and most of the Tri-Valley, agreed and said the county has focused its efforts on shoring up health care in Northern Alameda County, while ignoring the rest of the county.

“This is really unfair that we have to come down every year and fight for money,” said Haggerty, “Because what is going to happen is, they go out of business and it’s going to put pressure on Washington Hospital and they’re going to get in the same boat that they are in.” Washington Hospital is a safety net health care facility in Fremont that, unlike, St. Rose, is in relatively secure financial shape.

Much of Alameda County’s funding for health care is derived from the Measure A sales tax measure approved in 2004. Alameda Health System, which operates Highland Hospital in Oakland, Alameda Hospital, and San Leandro Hospital, receives the lion’s share of funding, roughly 75 percent, or roughly $1 billion.

In years past, Haggerty has been critical of previous contributions by the county to Highland with little reduction in the hospital’s debt, which is contrary to St. Rose’s fiscal belt-tightening, Haggerty said.

“There’s something really wrong because we know the amount of money we’ve given Highland and we know the amount of deficit they are in today. It is simply not fair to make [St. Rose] come and beg for $16 million a year. It is not fair,” Haggerty said.

Chan agreed with the sentiment of Haggerty’s argument, but told him.” I just don’t want to hear these lectures.”

In addition to Measure A funds, other entities, such as Kaiser Permanente have contributed money to help St. Rose, and may do so again this year. Hayward recently approved a $1 million Community Development Block Grant allocation to the hospital.

Colleen Chawla, director of Alameda County Health Care Services Agency, said further solutions for stabilizing the hospital were offered recently to St. Rose officials, included using the facility’s inventory of extra hospital beds for county mental health services; a partnership on a capital project; and directing private donations to the county in order to leverage additional federal funding. None of the proposals have been moved forward, Chawla said.

Dhuper has also met with the Eden Health District about funding. A potential parcel tax for St. Rose has often been bandied about between local official and the Eden Health District Board of Directors, but without success.

Alameda County Supervisor Richard Valle, however, attempted Tuesday to increase the county’s contribution to St. Rose by motion for an extra $3.5 million in matching funds using Measure A reserves for the current fiscal year. The motion would have raised the county’s possible allocation to $16 million. But Chawla told the board that the reserves, estimated to be around $7 million to 9 million, while not designated, are already subject to competing interests in the county.

Valle then relented before approving the original $4.5 million in matching funds. “As much as I would like to that put into the motion,” Valle said of the reserve funds, “I’m trying to achieve with my colleagues a balance with the other needs of he county and the other demands that we have.”

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