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UCSF Health reports $50 million in losses since acquisition of Dignity hospitals, pledges investments and Medi‑Cal continuity
Summary
UCSF Health officials reported to the San Francisco Health Commission that the first six months after acquiring Saint Mary’s and Saint Francis hospitals uncovered substantial deferred maintenance and operating losses, and that UCSF has made immediate investments while committing to continue Medi‑Cal and behavioral health services.
UCSF Health executives told the Health Commission that in the first six months after acquiring Saint Mary’s and Saint Francis hospitals they found greater deferred maintenance than expected and combined operating losses of more than $50 million since the acquisition.
Josh Adler, executive vice president and chief clinical officer at UCSF Health, said UCSF has invested more than $20 million in core facilities and equipment at the two hospitals and roughly $40 million in IT infrastructure, including a full electronic medical record transition to Epic scheduled for October. Adler said UCSF will expand hospital medicine capacity at St. Mary’s and add advanced imaging and pediatric specialty services at St. Francis. He also said UCSF is pursuing a Prop 1 Behavioral Health Continuum Infrastructure Program grant with DPH to expand behavioral health services on the St. Francis campus.
UCSF confirmed that employees of the two hospitals became UCSF employees on Aug. 1 and that the system has honored existing payers and Medi‑Cal managed care contracts. Adler said UCSF remains committed to maintaining and improving inpatient psychiatric and behavioral health services for Medi‑Cal beneficiaries and that there were no acquisition‑related layoffs beyond ordinary staffing reductions.
Commissioners pressed for data on workforce, service consolidation opportunities and the outlook for federal funding; Adler said more comparative utilization and workforce data will be available after a full year post‑acquisition and that the organization is assessing opportunities to improve efficiency while preserving community hospital access.
