04/10/2012 04:40 pm ET Updated Apr 10, 2012

CPMC Cathedral Hill Hospital Plan Draws Major Controversy (PHOTOS)

One might think that something as pleasant sounding as the construction of a hospital might be relatively uncontroversial in San Francisco.

But, as the picket line in front of California Pacific Medical Center's Davies Campus in the Duboce Triangle demonstrates, the issues surrounding the Sutter Health affiliate's plan to develop a massive, 15-story, 555-bed health center on Cathedral Hill--complete with a three-story underground parking complex--are among the most contentious of any development project in all of San Francisco.


The protesters are striking over a disagreement with management over their pay scale: CPMC's offer is lower than what union members earn at other Bay Area hospitals owned by Sutter and they want to get paid the same as their union siblings on the other side of the Bay.

"They told us they need the money to build their new hospital," union rep Joseph Klein told the San Francisco Bay Guardian. "[CPMC negotiators] don't even question whether they can afford to pay us comparable salaries. They just say they want to spend the money on that project."

The amount of money CPMC plans to spend on a new hospital at the site of the old Cathedral Hill Hotel on Van Ness Avenue is substantial. While the exact number has bounced around a bit, the most recent projection has pegged it at $1.9 billion. That figure is only a portion of the overall $2.5 billion system-wide renovation project that CPMC has planned, which includes a complete rebuild of St. Luke's Hospital in the Mission.

San Francisco's Planning Commission gave CPMC's proposal its preliminary approval on Monday, but the project still faces a whole host of obstacles before getting the final go ahead (despite the full-throttle support of Mayor Ed Lee). Lee largely backs the plan due to CPMC's promise that the project would create 1,500 new jobs (five percent of which are required to go to San Francisco residents) and bring $2.5 billion into the local economy. CPMC is already the second-largest private employer in the city.

The San Francisco Examiner reports:

[CPMC] CEO Dr. Warren Browner said he was "very pleased" with the vote. He called some of the criticisms “fundamental misunderstandings” of the deal, but conceded that other areas may need “additional clarification.”

“This is an incredibly important project for the folks who live and work and visit here, and we want to see it happen,” he said.

To get officially approved, the deal must go before a highly skeptical Board of Supervisors, many of whose constituents have expressed concerns about the drain the giant development, expected to draw 10,000 cars per day to one of the busiest intersections in all of San Francisco, will have on city services.

While City Hall is confident the project will eventually become a reality, a measure approving the hospital's construction has yet to receive the official sponsorship of a single supervisor.

Due to a deal negotiated between Lee and CPMC leadership, the hospital would provide care for 10,000 of the new Medi-Cal beneficiaries projected to be covered under the new federal health care law for a full decade, give $86 million in annual charitable care to low income patients, put $64 million towards affordable housing ($29 million of which will go to CPMC employees), give $20 million to community health clinics and another $31 million toward public transportation and pedestrian safety improvements.

These concessions weren't enough for some activists, who staged a protest on the steps of City Hall on the same day the deal was announced. The coalition of union and community leaders, calling itself San Franciscans for Healthcare, Housing, Jobs and Justice, expressed doubt that these were the most favorable terms the city could have gotten on the deal.

"The proposed development agreement as we understand it is a special deal that is good for Sutter/CPMC, but bad for San Francisco," said coalition spokesperson Leighton Woodhouse in a statement. "[It's] a deal that falls far short of the Mayor’s original 'asks'; that relieves Sutter/CPMC of responsibilities met by other private non-profit hospitals; that does not provide the healthcare and jobs City residents need; that fails to address the affordable housing, traffic, and neighborhood impacts the project will produce; and that leaves City taxpayers to foot the bill for the project’s failures in each and every one of these areas."

Others joined the chorus of criticisms. The San Francisco Chronicle reports:

That [10,000 Medi-Cal patients] figure was derived as an average of the CPMC's charitable care over three years, even though the medical group has been criticized for spending proportionately less on care for poor residents than other private nonprofit hospitals in the city.

"They're using as a baseline CPMC's history, which is lousy," said Bob Prentice, a former deputy director at the city's Public Health Department. "They're letting them get away without that past, without some kind of correction."

Others voiced concerns that St. Luke's Hospital, which largely serves lower-income and minority patients, will no longer be able to adequately fill the needs of the surrounding community as its renovation plans call for decreasing the number total of beds at the facility by more than half.

For its part, CPMC asserted to Bay City News that the remodeled facility will offer its patients a higher level of care.

In an editorial in the Examiner, Chamber of Commerce President Steve Falk waived off all these criticisms as just the typical griping that accompanies virtually every development project in the city.

"In this case, CPMC critics claim the agreement does not 'go far enough' in providing benefits to the community. Yet, beyond providing two new hospitals at no cost to taxpayers, the CPMC agreement guarantees $1.1 billion in added investment for San Francisco," wrote Falk. "By any measure, CPMC’s investments are sure to benefit thousands of residents and visitors."

The project returns to the Planning Commission for a final vote on April 26th. If all goes according to plan, CPMC hopes to open its new Cathedral Hill campus in 2016.

Check out this slideshow of pictures showing what the new hospital is going to look like: