San Francisco officials press CMS as Laguna Honda seeks recertification; hearing continued to September

The San Francisco Board of Supervisors convened a public hearing on May 9 about Laguna Honda Hospital’s plan for recertification and a closure, transfer and relocation plan, hearing a status report from interim CEO Roland Pickens and sustained public comment urging the city and federal regulators not to resume forced transfers.

The hospital and city officials described progress toward meeting conditions set by the Centers for Medicare and Medicaid Services, but stressed they remain dependent on CMS to extend a pause on transfers that currently expires May 19. “We are still awaiting a response for CMS on that request,” said Roland Pickens, interim chief executive officer at Laguna Honda Hospital and director of the San Francisco Health Network.

The matter prompted sustained comment from advocates, residents and hospital staff who said involuntary transfers last year were traumatic and deadly. “Readmissions must restart as soon as possible,” said Norman Daigleman, a longtime San Francisco resident. Laura Quiera of Legal Assistance to the Elderly told supervisors, “a 20% death rate of transfers is not acceptable.”

Why it matters: Laguna Honda provides long-term skilled nursing care to hundreds of San Franciscans and the hospital’s Medicare and Medi-Cal participation accounted for roughly half a million dollars a day in revenue, Pickens said. A decision by CMS to withhold or end reimbursement could force bed reductions or transfers for residents many advocates said have nowhere safe to go.

What officials told the board

Pickens reviewed the background: CMS terminated Laguna Honda’s participation in Medicare and Medicaid in April of the prior year. The city sued, and a settlement reached in November kept CMS payments in place through Nov. 13 and paused discharge/transfer directives. Under the settlement, the city has asked CMS to continue the pause beyond May 19; as of the hearing Pickens said the city was “still awaiting a response.”

Pickens told the board that a CMS-appointed quality improvement expert completed a root-cause analysis that identified 11 causal factors and about 330 milestones to address them. He reported Laguna Honda met all CMS-identified milestones in January, February, March and April: “all 116 milestones have been accepted by CMS as being complete and completely implemented,” Pickens said.

Pickens also said Laguna Honda currently has about 527 residents in house and that roughly 40–41 people no longer meet a skilled nursing level of care; CMS and HHS have instructed the hospital to move forward with discharges for that subgroup when placements can be identified. Pickens warned the city that finding placements is difficult because many of those residents lack housing and have co-occurring behavioral-health needs.

Supervisors pressed hospital leaders on recruitment, alternative placements and the timeline for the next monitoring visit. Pickens said the department had used an executive search firm and expected to make an offer for a new nursing home administrator soon; he said the third monitoring survey is expected sometime in late May through June and, if successful, the city would consider submitting an application for recertification this summer.

Public comment and staff, union testimony

Dozens of residents, advocates and staff spoke during public comment. Union and frontline staff said morale and staffing remain stressed but that employees are committed to recertification. Jessica Inouye of SEIU Local 1021 said union members “are on the front lines every single day making sure that the hospital runs.” Several attorneys and elder advocates warned that transfers last year led to deaths and that urgent precautions were needed before any new discharges.

Legal assistance attorneys and residents described difficulties with community placements and home-care capacity. “We had a client who was discharged with assurances of home care and within hours ended up at SF General,” said Laura Quiera.

Board action and next steps

After the update and public comment, Supervisor Matt Haney Melgar (District 7) asked to continue the hearing so the city could await a CMS response and to allow more time for monitoring and planning. Colleagues supported the request. A motion to continue the hearing to Sept. 26, 2023, was made and seconded; the board took the continuation without objection.

What remains unresolved

City officials continue to press CMS and HHS for a formal extension of the pause on transfers beyond May 19. The hospital and the Department of Public Health reported substantial monthly milestone completion, but officials and advocates said a transparent, robust plan to place the subset of residents who no longer meet skilled nursing criteria is still required. Advocates and supervisors urged additional investments in community behavioral-health residential beds and other long-term care options.

Context and next steps for the public

Pickens said the city will rely on the results of the upcoming monitoring survey to set a recertification timetable. In the meantime, the board’s continuation to Sept. 26 leaves the item on the calendar for further oversight and gives the public and the city additional time to press CMS for a clear decision about the pause on transfers.