San Francisco reaches agreement in principle with CMS to extend Laguna Honda payment, pauses involuntary discharges

San Francisco officials told the Health Commission on Nov. 15 that the city has reached an agreement in principle with the federal Centers for Medicare & Medicaid Services that would keep federal payments flowing for Laguna Honda Hospital residents through Nov. 13, 2023, and pause involuntary discharges and transfers until Feb. 2, 2023.

Baljeet Sangha, chief operating officer for the San Francisco Health Network, said the pause can be extended if Laguna Honda makes continued progress toward recertification. He said the agreement allows resident-initiated transfers and discharges to continue and aligns with hospital policy.

Sangha reported that a mock survey identified 101 findings that led to 371 corrective actions, of which 55 have been verified as fully resolved. He said the hospital has implemented corrective actions and is tracking short- and long-term changes with the goal of reaching 100% verification in the coming weeks. Sangha also said all 13 units met environment-of-care thresholds in recent rounds and that infection-prevention measures currently show 11 of 13 units above the 90% target.

Troy Williams, the network's chief quality officer, outlined a series of systemwide improvements in care planning, documentation, restraints and call-light response. Williams described work with external experts and partners — including infection-control alignment to CMS Phase 3 skilled nursing requirements — and said the department will roll out training and education materials in December.

During public comment, geriatrician Dr. Teresa Palmer urged city and state officials to decouple recertification timelines from closure or bed-reduction decisions, warning that losing Medi‑Cal nursing beds would worsen regional shortages. Another caller, Alju Manette Shaw, asked the commission to release a revised closure plan and to halt a so‑called "flow project" that he said transfers behaviorally challenged patients to Laguna Honda.

Commissioners asked about resident surveys and town‑hall frequency; presenters said town halls are scheduled twice a month and that staff will assist residents at bedside when technology presents barriers. Commissioner Guillermo pressed presenters on how facility-reported incidents and prior investigations would be incorporated into the root cause analysis. Sangha said the settlement prescribes specific survey dates but that engagement with the quality-improvement expert and CMS should allow review of additional facility-reported data when appropriate.

The commission voted to enter a closed session on Laguna Honda later in the meeting. The presentation materials and updates were scheduled to be returned to the commission in a future meeting as the hospital develops an updated roadmap to recertification.