California Pacific Medical Center-San Francisco Deal Raises Cost Concerns

The deal San Francisco Mayor Ed Lee recently struck with San Francisco-based California Pacific Medical Center to build five new medical facilities is raising concerns of increased healthcare costs among city leaders, according to a San Francisco Chronicle report.

CPMC was approved for a $2.5 billion project that includes building a 555-bed hospital in turn for providing the city $86 million in annual charitable care for 10 years, among other services. While the deal places a cap on rates the hospital charges to Blue Shield for city coverage, there are fears construction costs would be shifted to taxpayers in increased healthcare premiums.

Under the agreement, CPMC would be required to provide less charity care than it has in the past. A December report from UC Hastings College of the Law found the hospital, an affiliate of Sacramento, Calif.-based Sutter Health, provided less charity care than other private, non-profit hospitals in the city. In 2010, CPMC spent $101 million in charity care. The current deal requires CPMC to spend a minimum of $86 million in charity care annually in addition to a maximum of $9.5 million for an additional 10,000 Medi-Cal patients — a total of $95.5 million, according to the report.

Mayor Lee says the deal guarantees $1.1 billion in community benefits and will create 1,500 construction jobs, retain 6,000 existing medical center jobs and add up to 1,500 permanent new jobs, according to the report.

The deal needs support from the city's 11 supervisors and approval from the Planning Commission, which will look at the plan Thursday, according to the report.

More Articles on San Francisco and CPMC:

California Pacific Medical Center, San Francisco Mayor Strike Agreement on Expansion
California Pacific Medical Center Most Profitable in San Francisco, But Charity Care is Low

California Pacific's Community Benefit Plan Falls Short of San Francisco Mayor's Request

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