City staff recommend finding California Pacific Medical Center compliant with development agreement for 2022–23

City planning and public-health staff recommended at a joint Planning Commission and Health Commission hearing May 15 that California Pacific Medical Center (CPMC) be found in compliance with its development agreement for combined reporting years 2022 and 2023.

The recommendation follows presentations from Planning Department staff and agency partners reviewing CPMC’s payments, workforce and health-care commitments under the development agreement (DA) connected to the Van Ness and Mission Bernal projects. Planning staff said the DA requires an annual compliance report from CPMC and a city determination, which will be reviewed by a third‑party monitor before the Board of Supervisors receives the result.

City staff told commissioners that Sutter Health, the regional system that operates CPMC, completed required DA payments totaling more than $73,000,000 for the combined reporting period. Third‑party audit work by Deloitte verified compliance for several financial and care metrics, staff said.

In the health-care commitments section, Maxwell Garrett of the Department of Public Health said CPMC exceeded the DA requirement to care for 30,345 unduplicated charity‑care or Medi‑Cal patients, reporting about 30,836 patients in 2022 and 31,865 in 2023. Garrett said CPMC also exceeded the DA community‑benefit dollar requirement, reporting about $15,000,000 in 2022 and $11,300,000 in 2023.

Garrett summarized other DA health provisions: continued participation in Medi‑Cal managed care with the San Francisco Health Plan; partnership with the NEMS management services organization to serve Tenderloin residents (about 4,900 unduplicated lives in 2022 and about 5,200 in 2023); maintenance of specialized programs at the Mission Bernal campus; and operation of an acute‑care‑for‑the‑elderly (ACE) unit that served roughly 1,000 patients in 2022 and about 1,100 in 2023 (exceeding the DA goal of 600 patients).

Staff said three health obligations will remain in force through 2028: maintenance of specified services at the Mission Bernal campus, operation of the Mission Bernal centers of excellence (community health and senior health), and annual health‑care compliance reporting. Staff noted earlier DA obligations that were completed in prior years (for example, some innovation‑fund items in 2020 and subacute‑care obligations completed in 2016).

Commissioners asked for updates on a few outstanding items. Commissioners and staff discussed Guerrero Plaza (the park/plaza adjacent to the Mission Bernal campus) and were told by Carl Hennessy of Public Works that negotiations over final design and maintenance had delayed permit issuance but that final design was complete and Public Works was prepared to issue a construction permit to start work. Sutter/CPMC representative Bahram Masahian said the lower plaza that was installed earlier will be reinstalled after the neurosciences care complex construction and that the medical office building is funded and targeted to open around 2028.

Planning and Health staff also noted a DA provision limiting activation of 30 additional shelved beds at the Van Ness hospital until the Mission Bernal census reaches 75 percent for a full fiscal year; staff said that threshold was not met in 2022 or 2023 and therefore the provision did not apply for those years. Staff further reported that on April 3, 2024 CPMC gave city notice of the permanent closure of labor and delivery services at the Mission Bernal campus; that notice activated the six‑month meet‑and‑confer process in the DA and triggered hearings under the city’s community‑health‑care planning ordinance (Proposition Q). Health Commission hearings in fall 2024 found that the closure would not have a detrimental impact on San Francisco health services provided CPMC take specified mitigation steps (continue safety‑net roles, maintain or expand the Mission Bernal women’s clinic, and communicate transportation options to patients).

Workforce and related community investments were highlighted by Lowell Rice of the Mayor’s Office of Economic and Workforce Development (OEWD). Rice said CPMC met or exceeded non‑construction hiring goals: in the DA’s final year (Aug. 2022–July 2023), 78 of 160 hires (from the workforce referral network) came through the city’s referral network and the DA’s longer‑term hiring goals were met without deficit carryovers. Rice said a CPMC workforce fund targeted to training and barrier‑removal retained about $870,000 as of May 31, 2020 and that funds were distributed to grantees including Jewish Vocational Services (JVS), Self‑Help for the Elderly, Success Centers and FACES San Francisco.

After the presentations, planning staff summarized their view: "Sutter Health is in compliance with the requirements of the CPMC development agreement" for the 2022–2023 reporting period, and staff recommended that the directors of Planning and Public Health so find. The directors' determinations will be reviewed by a third‑party monitor and then sent to the Board of Supervisors, staff said.

Commissioners praised the overall compliance results while flagging several items for continued monitoring. Vice President Guillermo and Commissioners Moore and Chao urged ongoing reporting on the three DA obligations that continue through 2028 and on citywide gaps in subacute care capacity; Commissioner Braun asked SFMTA staff about a planned signal at 20th and Guerrero, and SFMTA’s Victoria Chung said a signal is planned for activation in fall 2027 and that coordination on curb ramps and crosswalk design is ongoing.

The hearing was informational; no vote was recorded. Staff indicated they will continue to provide written updates on the remaining DA obligations and to forward future updates to commissioners.