Supervisors Hear Months-Long Debate Over Closure of SF General Workers’ Comp Clinic

The Budget and Finance Committee of the San Francisco Board of Supervisors held a public hearing on the proposed closure of the San Francisco General Hospital workers’ compensation clinic, during which Department of Public Health Director Mitch Katz said the department intends to stop accepting new patients Feb. 1 and close the clinic on March 15 as part of cost-cutting measures.

"We are set to close March 15, and that's to assure an orderly transition," said Mitch Katz, explaining the department’s decision and adding that the closure would produce an immediate general fund savings of about $730,000.

The committee and staff pressed DPH for analysis demonstrating a net citywide savings. Budget analyst Ken Bruce and Monique Smuda from the controller’s office said no intra-clinic comparison exists that reliably shows whether the public clinic produces lower total workers’ compensation costs than private providers. "To my knowledge, the data does not exist," Bruce said.

Clinicians and labor leaders told the committee the clinic provides services they said are not easily replicated elsewhere. Sam Goldman, a physician at the workers’ comp clinic, framed the financial argument differently: "Direct medical costs comprise only about 20% of workers' comp expenditures. The other 80% is time, lost work time and non-productive work hours," Goldman said, warning that shifting care to private providers could raise total indemnity and productivity costs.

Union leaders and clinic staff described services that would be lost if the clinic closes. Nurse case managers urged that case management is provided without direct charge and said that losing those in-house services could slow return-to-work timelines. "We have an open door policy," said nurse Annette Jaggers, describing how on-site case management helps employees return to modified duty and avoids unnecessary attorney involvement.

Several speakers said private clinics can use different billing practices and may increase direct medical charges and the frequency or duration of visits. Physician John Hall cited an example in which an outsourced occupational health program increased costs and proved unsuccessful. Labor Council Executive Director Tim Paulson told supervisors the council adopted a resolution urging the city to keep the clinic open.

DPH staff acknowledged uncertainty about how closure would affect overall workers’ compensation spending because employees self-select providers and comprehensive, normalized comparisons would be difficult and time-consuming. The department also said nurse case management might be billable in limited circumstances, potentially generating roughly $80,000 annually, but that the amount and permissibility are uncertain.

The controller’s office noted the Board previously provided an "add-back" of funding for continuing operations and that an approximate $1.4 million allocation exists from the last budget cycle; Monique Smuda warned that the health department’s total current-year deficit is far larger and that a separate supplemental budget request (reported to be substantial) does not include the workers’ comp clinic.

No formal committee vote to stop the closure was recorded at the meeting. Supervisor Mercurini said she would pursue legislative options and asked staff to provide more analysis; the committee concluded the hearing and will rely on further staff analysis and future budget deliberations.

The committee adjourned pending action on separate agenda items and a closed-session discussion of litigation later in the meeting.