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Committee forwards $29.5M supplemental to cover public‑hospital shortfalls after state fee cuts; debate over contracting out security
Summary
The committee forwarded a reduced supplemental appropriation to cover cost overruns at San Francisco General and Laguna Honda Hospitals after state hospital fee revenue fell short; the Department of Public Health described a $56M reduction in expected hospital fee revenue and requested $17M more to cover final gaps. Public commenters and staff debated contracting out hospital security versus building a civil service option.
The Budget and Finance Committee advanced a supplemental appropriation to address cost overruns at the Department of Public Health after the city learned state hospital fee revenues would be far lower than budgeted.
DPH representative Greg Sass outlined a sequence of state actions and implementation issues that reduced expected hospital fee revenue: initial budget assumptions budgeted $88 million; the effective date for payments was moved, reducing the catch‑up by six months and reducing funding by $23.5 million; later state legislation eliminated funding to public hospitals for the final six months, reducing projections by another $16 million; and, lastly, private hospitals ceased fee submissions that blocked a final federal drawdown of roughly $17 million. Combined, these changes caused the department to overestimate this revenue by about $56.5 million. DPH said most of that shortfall was covered internally but requested a supplemental to cover a remaining gap.
The budget analyst proposed and the committee accepted an amendment reducing the original $31,055,000 request by $1,560,187 to $29,494,008 and recommended approval as amended. The committee accepted the analyst recommendations and moved the item forward with recommendation.
A parallel discussion focused on hospital security staffing. DPH reported it examined contracting, civil service conversion and continuing a sheriff’s work order. Staff found the civil service option’s timeline and costs (recruiting, background checks, paid time off, supervision, and HR costs) were understated and that projected savings would likely not materialize in the near term. DPH plans to continue studying options; public commenters, including a San Francisco General worker, vocally opposed contracting out security on safety grounds.
Public comment included Thomas Picariello’s budget critique and Brenda Barrows, a San Francisco General employee, who said, “We are adamantly opposed to this,” arguing that civilian security guards lacking arrest authority would put staff at risk.
Next steps: Committee‑approved amendment forwarded to the Board of Supervisors for consideration; DPH and budget staff to return with further analysis of security options and implementation timelines.
