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Grand Jury Report Slams Medical Center By MATTHEW ARTZ

Tuesday July 05, 2005

The Alameda County Medical Center—the only option for Berkeley’s 10,000 uninsured—continues to run up deficits despite a $70 million county bail-out last year, according to a recently-released report from the Alameda County Grand Jury. The report lays the blame on the center’s board of trustees. 

The grand jury is a 19-member citizen body selected by superior court judges to investigate county governmental issues. 

“Instead of grasping the concept that the medical center is facing a dire financial crisis, the board of trustees has spent the last year preoccupied with infighting...” the grand jury reported. 

The medical center includes Oakland’s Highland Hospital, which serves most of Berkeley’s trauma and emergency cases. Also in the public hospital network, required to treat the uninsured, are San Leandro’s Fairmont Hospital, John George Psychiatric Pavilion and three outpatient clinics. 

Especially troubling to the grand jury was the fact that the medical center remained in the red despite a bail out designed to reorder its finances.  

Last year, with the medical center facing a $50 million deficit, county voters approved Measure A, a half-cent sales tax increase that delivers the medical center $70 million a year. But despite the influx of cash, the medical center remained $3 million in debt last year and costs are expected to increase by $10 million this year. 

“The medical center board of trustees seem to have taken the passage of Measure A as a signal to engage in irresponsible spending,” the grand jury wrote. 

Public hospitals in the state have been hard hit by lower fees paid by Medicare and Medi-Cal and an increase in low income residents without insurance. 

The Medical Center, however, has been rife with dissension and mismanagement, the grand jury found. After going through nine CEOs in 11 years, last year the county brought in Tennessee-based Cambio Health Solutions to run the center and get its finances in order. 

The Grand Jury praised Cambio for improving efficiency in collecting payment for services and criticized the board for refusing to implement the consultant company’s plan to lay off 120 employees. Instead of layoffs, the board sought to cut staff by attrition and gave employees “across-the-board increases in employee salaries and benefits,” according to the report. 

Employee unions have “gained unprecedented control over hospital operations,” the grand jury wrote. Medical center work rules “give employee groups the right to veto or to prevent management from taking action.” 

For instance, a nurse cannot be reassigned from one patient ward to another even if the proposed ward is understaffed, the grand jury wrote. “Instead, the medical center must hire a temporary nurse at a substantially higher cost.” 

The board must either eliminate jobs or reduce services, but the board hesitated to do either, according to the grand jury. 

“Shockingly, the medical center has not even reviewed the question of whether the scope of service it provides should be reduced to balance its budget,” the grand jury wrote. 

The grand jury also blasted “a culture of failing to accept personal responsibility” it blames for a workers compensation crisis at the medical center. On any given day, 25 percent of employees are not at work because of an on the job injury or long-term disability, the grand jury found. 

Without making specific recommendations, the grand jury urged the board to make cuts, “even if it means laying off employees or reducing the scope of medical services it provides.” 

In its annual report, the grand jury also criticized the Alameda County Board of Education for failing to prevent financial crises in several local districts in the county and for not fully complying with open government laws. 

The board’s agendas “don’t fully inform the public of the substance of issues coming before the board and in some cases were misleading,” the grand jury found. 

Also, board minutes were found to lack information on the substance of controversial issues. 

The grand jury criticized Oakland for a contract that gives one tow company, A&B Auto Company, a monopoly on towing services with the city. 

The grand jury also found fault with the soon-to-be-closed Oakland city jail for poor conditions. County detention facilities, including Juvenile Hall and Santa Rita jail, scored higher. 

A copy of the annual report can be found at