Mixed reviews for Seton sale: One union vows to fight sale to controversial hospital chain, other strikes deal for nurses

San Mateo County leaders both local and in Sacramento expressed worry about the proposed sale — with Assemblyman Kevin Mullin, D-South San Francisco, going so far as to say he hopes it falls through — because of potentially negative impacts to the two area hospitals.

Seton is the largest employer in Daly City and provides a large chunk of the county’s care to northern residents and the low-income which is why county officials allocated nearly $19 million in Measure A half-cent sales tax funds for seismic upgrades at the aging hospital. Seton Coastside is a 116-bed skilled nursing facility with the only 24-hour emergency department along the 55-mile coastal stretch between Daly City and Santa Cruz.

As part of its Measure A funding agreement with the county, Seton promised to continue providing safety net services to low-income residents. Seton and DCHS had donated $1.5 million to the 2012 campaign to get Measure A passed.

Dave Pine, president of the Board of Supervisors, said the county’s continued funding is predicated on Prime continuing the agreements but nothing is assured.

“The agreement with Seton applies to Seton and Seton only. It does not pass to the successor entity. It’s impossible to say where the county will go at this point. We’ll have to see what the final agreement looks like,” Pine said.

The sale must still be approved by the Vatican and California Attorney General Kamala Harris.

The bid by Prime — chosen from four finalists culled from a 133-candidate pool — was superior in all categories, according to DCHS.

“[O]ur priority was to seek the best buyer who could guide our hospitals into a successful future while honoring the obligations to our associations, retirees and other constituents,” Robert Issai, DCHS president and CEO, said in a prepared statement.

Union opinions

The potential threat to those obligations sparked much opposition to the Prime sale even before Friday’s announcement and the SEIU-United Healthcare Workers West wasted no time Friday morning announcing plans for a TV advertising campaign urging Harris to reject the sale. The union says Prime’s history includes investigations for allegedly overbilling Medicare and threatening to take the DCHS hospitals into bankruptcy.

“We are not going to roll over and risk watching Prime Healthcare cut services, raise prices and lay off caregivers like they’ve done in so many other communities in California and other states,” said SEIU-UHW President Dave Regan who called the sale “disappointing.”

On the other end of the spectrum, the California Nurses Association opposes any blocking of the sale, saying that and not the sale is what would jeopardize vital hospital services, jobs and health. CNA reached an agreement with Prime for Seton, O’Connor and St. Vincent Medical Center in Los Angeles that promises the hospitals will be operated for a minimum of five years, all pension promises made to current and future retirees remain intact and no services will be reduced. CNA also said the two entities reached a framework agreement on collective bargaining rights, job preservation and maintaining labor standards.

Regan said he didn’t know the terms of the CNA agreement but that it is no guarantee.

“Those, if they exist, aren’t worth the paper they’re printed on if Prime declares bankruptcy,” Regan said.

Regan said DCHS’s finances are so deteriorated it’s hard to believe the CNA thinks nothing will change.

SEIU-UHW is still promoting Blue Wolf Capital Partners as the best buyer for the hospitals and Regan said he hopes the advertising campaign educates the public about the alternative.

If the sale is approved, Prime said it is will also spend at least $150 million on capital improvements over the next three years and protect 7,600 jobs.

"We are committed to preserving these hospitals and continuing to deliver the highest quality patient care to the communities they serve,” Dr. Prem Reddy, president and CEO of Prime Healthcare, said in a prepared statement.

Local concern

Those promises, however, may not be enough to appease San Mateo County officials who’ve been watching the process closely since DCHS put the six hospitals on the sales block in January. In August, the Daly City Council adopted a resolution calling on Harris to order any buyer of Seton Medical Center to keep the facility operating as a full-service acute hospital with the same employees, labor agreements and pension obligations. On Friday, Canepa reiterated his commitment.

“I am looking forward to ensuring that Seton Medical Center remains a full-service hospital and to the California state attorney general’s review of the new buyer,” Canepa said.

In August, state Sen. Jerry Hill, D-San Mateo, also sent a letter to Harris saying he was troubled by the idea of Prime being a top bidder. On Friday, Hill said his position hasn’t changed.

“I’m really concerned because Seton especially has been a troubled hospital because of the large Medi-Cal population it serves. It’s going to be a struggle,” he said. “I’m very apprehensive.”

Assemblyman Rich Gordon, D-Menlo Park, also joined the chorus urging Harris to ensure the sale terms protect patients and workers.

“I have serious concerns about the announced sale of Seton Coastside from the Daughters of Charity to Prime Healthcare,” said Gordon, whose district includes the Moss Beach hospital. “Available evidence demonstrates that Prime’s record and approach to health care could be detrimental to the services [there].”

Prime Healthcare and the Prime Healthcare Foundation own and operate 29 acute-care facilities in nine states.

In voicing his “grave” concerns, Mullin echoed the SEIU-UHW in ticking off Prime’s troubles like the fraudulent billing investigation along with unfair business practices, regulator problems and violations of worker rights.

“I do not believe this sale will be in the best interest of the community. I would like to see the attorney general block the sale. ... It is imperative that we protect the interests of patients and workers,” Mullin said in a prepared statement.

michelle@smdailyjournal.com

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