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San Francisco Marin Medical Society Blog


LAGUNA HONDA AT RISK: SFMMS Meets with the Centers for Medicare & Medicaid Services About Certification of Laguna Honda Hospital

On August 29th, 2022, the San Francisco Marin Medical Society (SFMMS) met with the Centers for Medicare & Medicaid Services (CMS) regarding ongoing issues related to the certification of the Laguna Honda Hospital and Rehabilitation Center (LHH), the deadline for which is now November, 2022. Approximately 700 patients with complex care needs receive care at LHH. It has long served an essential purpose in our community, serving as a care site for some of our most vulnerable citizens, most with no other options.

SFMMS leaders expressed to CMS their deep concern for the welfare of patients should 1) LHH fail to attain certification, 2) federal payments cease, and/or 3) the transfer of patients from LHH occur. Following our conversation with CMS, we are unable to anticipate a scenario in which LHH attains certification by the November 2022 deadline without transferring patients, at great risk to the health and wellbeing of this medically fragile population.

Of particular concern to SFMMS is that in order to attain certification, LHH must either expand its capacity to house patients or reduce the number of beds by approximately 120 before the November 2022 deadline for certification. Further deadline extensions or continuance of federal payments without certification are unlikely. Should LHH fail to attain certification, federal payments will cease, and the remainder of LHH patients would require transfer.

It is unclear how LHH can fund the transfer of patients should payments cease. There are insufficient beds in San Francisco, the Bay Area, or California to accommodate either 120 or 700 long-term patients, and their transfer may have drastic, negative effects that will ripple throughout San Francisco’s health care systems.

“We understand that the standard for certification is a matter of statute, and CMS’ responsibility is to issue certification based on whether a hospital meets that standard. Those standards exist in order to ensure the safety of patients and quality of care,” said SFMMS President, Michael Schrader, MD. 

“However, in order for LHH to meet those standards, it may be required to transfer patients on such a short timeline that it will result in harm to those patients. The removal of this hospital of last resort may also create failures that will cascade throughout the health care system.”

In April 2022, federal CMS decertified LHH following inspections from 2021-2022. The decertification ended Medicare and Medicaid payments, which constitute the vast majority of LHH’s revenue, requiring closure of the hospital and the transfer of approximately 700 medically fragile patients.

Patient transfers began in June 2022, following which, at least four patients died. Some of these medically fragile patients found themselves in homeless shelters. After outcry from the community, patient transfers were paused, payments resumed, and the deadline for certification was extended until November 2022.

The initial attempt to transfer patients from LHH laid bare the gaps in San Francisco’s delicate ecosystem of care and the devastating effects of transfers on some of the most complex patients in our community. Lack of access to LHH beds causes further gridlock in transferring appropriate patients out of our community hospitals, with adverse impacts for all concerned.

SFMMS is deeply concerned that it is not possible for LHH to attain certification without resuming transfer of patients that will again result in patient harm or deaths. SFMMS communicated these concerns to CMS, along with anecdotes collected from dozens of SFMMS’ physician members about the importance of LHH to their practice, their patients, and their community. Reports on this important topic will continue here and in the forthcoming issue of the SFMMS journal.

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