Unprecedented Healthcare Agreement to Double Number of Seismically Safe Hospital Beds, Inject $2.5 Billion into City’s Economy, Create 1,500 New Construction Jobs & Guarantee $1.1 Billion in Community Benefits
—Mayor Edwin M. Lee and California Pacific Medical Center (CPMC) CEO Warren Browner today announced a proposed development agreement that would allow CPMC to build two new state-of-the-art, seismically safe hospitals – at St. Luke’s in the Mission and at Cathedral Hill. The project will double the number of seismically safe hospital beds in San Francisco, inject $2.5 billion into the City’s economy, create 1,500 new construction jobs and guarantee $1.1 billion in community benefits.
“After months of tough negotiations and lengthy discussions, this partnership with CPMC is an unprecedented investment in the future of our City that will build two new seismically safe hospitals, create jobs for our City’s unemployed residents, and improve community benefits for our neighborhoods,” said Mayor Lee. “This new agreement will move San Francisco’s healthcare system into the 21st century and have lasting impacts on the health of generations of San Franciscans.”
“This is an unprecedented commitment by any healthcare provider and reflects our mutually shared interest in rebuilding CPMC and creating a partnership that will move San Francisco’s healthcare system into the future and enhance care for all the citizens of San Francisco,” said CPMC CEO Dr. Warren Browner, M.D. “The agreement includes commitments on the provision of charity care and the delivery of healthcare services to San Francisco’s neediest residents as well as money for affordable housing, neighborhood improvements, workforce development and public transit. We are grateful to Mayor Lee and his staff for their hard work and leadership in helping put this deal together.”
“This agreement is unprecedented. It creates two seismically-safe hospitals in San Francisco, includes a long-term commitment to St. Luke’s, and expands health care services for San Francisco’s most vulnerable populations,” said Department of Public Health Director Barbara Garcia. “St. Luke’s hospital is crucial to serving low-income residents in the City’s Southeastern neighborhoods.”
Under the proposed development agreement, the City will receive:
- Two new, seismically-safe hospitals, at the St. Luke’s and Cathedral Hill Campuses;
- A 20-year commitment to operate St. Luke’s Hospital, with emergency room;
- Significantly increased provision by CPMC of healthcare for low-income and underserved San Franciscans, including hospital care for 10,000 additional Medi-Cal beneficiaries, which represents one-third of the City’s new Medi-Cal beneficiaries expected under federal healthcare reform;
- $20 million endowment by CPMC of a new Community Care Innovation Fund, to support and improve the services of community clinics and other social service organizations;
- $63 million from CPMC for affordable housing, to replace displaced units, fund new affordable rental units, and help moderate income CPMC employees purchase a home in San Francisco;
- A limitation on premium increases from CPMC for City employee and retiree health insurance;
- 1,500 new construction jobs, with an agreement by CPMC for local hire of at least 30% of all construction workers, and at least 200 permanent hires through the City’s workforce system;
- Retention of CPMC’s 6,000 existing jobs in San Francisco, and future growth of up to 1,500 additional jobs in the long term;
- $20 million from CPMC for SFMTA transit facilities and service; and
- $13 million from CPMC for pedestrian safety and streetscape improvements.
Mayor Lee will introduce the proposed development agreement and associated legislation at the Board of Supervisors on Tuesday, April 3rd. The Planning Commission will hold an initial hearing on the CPMC project and the development agreement on Thursday, April 5th at 10 a.m., and is expected to consider approval of the project and certification of the environmental impact report later in April. Hearings at the Board of Supervisors are expected to begin in June.