SOUNDING OFF: Hospital questions remain unanswered

It is clear by now that our Laguna Beach community is ecstatic over the sale of the South Coast Medical Center to St. Joseph’s. We are grateful to our civic leaders who toiled so hard for so long to be sure we preserved our hospital.

While this sale to Mission is a welcome event for our community the actions surrounding the dissolution of the hospital’s charitable Foundation require further scrutiny. Eleven years ago, Adventist was allowed to take over the ownership and the running of the hospital. But the Foundation still owned the rest of the campus. Now, Adventist has dissolved the Foundation, taken control of all assets and sold it all. A huge public asset is now in private ownership.

We need to figure out how this was allowed to happen.

Further, while Adventist has been claiming it lost millions of dollars per year in running the hospital, we understand they have been paying themselves more than half a million dollars a month in corporate allocations.


South Coast Medical Center also has a favorable financial payer mix of insured patients for a California hospital, with very few indigent patients.

In fact, 93% of patients are third-party payers and Medicare or Medi-Cal fee for service patients. This facility is in one of the most affluent communities in the country. And still management claims to run this hospital at a loss! How could this be?

Obviously, if true, this financial structure makes the stated “loss" to be a paper loss only.

Now, this “paper loss" is used as justification to seize the foundation’s assets and to offset the profit from the sale of the hospital.


Doesn’t this violate, at least, the public trust? Shouldn’t citizen funds contributed to help Adventist keep the hospital open in Laguna be treated with care and respect?

We want Mission to come to Laguna very much. We pledge to do everything we can to make the Sisters of St. Joseph happy to be in our community.

However, we must insist on a full accounting of the past financial transactions surrounding the actual losses claimed by Adventist as justification for the seizure of foundation funds and public assets.

ARMANDO BAEZ lives in Laguna Beach.