Friday, June 6, 2008

Santa Cruz Medical Clinic drops Watsonville expansion plan
The Santa Cruz Sentinel
Donna Jones - Sentinel Staff Writer
Article Launched: 06/06/2008 01:32:44 AM PDT

WATSONVILLE -- Santa Cruz Medical Foundation is dropping plans to expand its clinic on Green Valley Road.

The decision came a week after the City Council voted to impose a 45-day moratorium on medical facility building or expansion to allow time to study the city's health care needs.

The foundation, which is part of Palo Alto Medical Foundation and affiliated with Sutter Health, announced the decision in a letter to city officials Thursday.

"We believe the foundation is being unfairly portrayed as the underlying source of problems with the Watsonville health care system rather than as part of the solution for what is a shortage of primary care services in the community," said Dr. Larry deGhetaldi, president of Palo Alto Medical Foundation's Santa Cruz region, in a statement.

The foundation planned to more than double the size of its 8,500-square-foot clinic to expand pediatric, obstetrics, family practice, physical therapy and radiology departments. Officials said the expansion would better serve existing patients and provide more access to specialists in South County.

But opponents worried expansion of the clinic, which accepts a much smaller percentage of Medi-Cal patients than is typical for South County practices, would increase competition for the higher paying insurance patients that help keep practices in the black. Concern also centered on how the expansion would affect Watsonville Community Hospital, which has struggled with its bottom line in the past in this low-income community, where many either have no insurance or rely on government programs.

On May 27, with a crowd of opponents present, the City Council considered whether to overturn a Planning Commission decision to approve the expansion but instead established the moratorium to allow time for a study of South County health care needs.

Mayor Kimberly Petersen said she was disappointed with the foundation's decision.

"Both groups agreed to a study," she said. "I felt really good that they might be cooperatively working on the future potential for medical facilities."

Petersen said she hoped the study would proceed anyway.

Lyn Miller, chairman of the Watsonville Community Hospital board, also said he'd continue to press for an assessment of South County health care. He said to some degree both sides were relying on assumptions.

"People need to understand the hospital needs to stay solvent," he said. "Whether that's a separate issue or a commingled issue would have been determined by the assessment."

DeGhetaldi, in his written statement, said the foundation will remain part of the community and looks forward to a "meaningful discussion on the real health care issues facing South County," but that the money that would have been invested in Watsonville will be put to use elsewhere in the county.

Contact Donna Jones at 408.763.4505 or djones@santacruzsentinel.com