San Joaquin General Hospital (SJGH) and Dignity Health, whose parent company is CommonSpirit Health, announced today that they have signed a Letter of Intent (LOI) to develop an agreement to enter into a long-term affiliation to enhance the ability of SJGH to provide critical care to the residents of San Joaquin County.

“San Joaquin County is pleased to announce this partnership with Dignity Health that will allow San Joaquin General Hospital to remain viable as a provider of cost-effective quality health care,” said Supervisor Tom Patti, Chairman of the San Joaquin County Board of Supervisors. “Due to the pandemic and a variety of other fiscal considerations, SJGH will require access to clinical, operational, educational and financial assistance that could only be provided by entering into an agreement with an established, successful health care system. We believe this affiliation will be significantly beneficial to all parties, but especially to patients and staff at SJGH by providing a more financially-secure hospital setting which offers more sustainable care over the long term.”

The LOI provides the negotiation components of an eventual Definitive Agreement and Management Services Agreement intended to achieve the following outcomes:

• Sustain SJGH as a vital health care provider in the community and improve the financial strength and integrity of both organizations;
• Shared expectations around, and continuous improvement in quality, patient experience, and operational efficiency;
• Expanded access to care through joint planning to enhance quality, access, clinical services, and graduate medical education; and
• Clear financial alignment and governance, ensuring that both parties (County and Dignity Health) have a vested interest in ensuring the partnership’s operating and financial success.

On February 9, 2021, the County Board of Supervisors authorized County staff to enter into a non-binding LOI to evaluate various options and negotiate the terms for structuring a potential partnership with San SJGH and Dignity Health. On May 25, 2021, both SJGH and Dignity Health signed the LOI regarding this partnership, which provides the intent of the two parties to enter into a long-term affiliation.

“This agreement between San Joaquin General Hospital and Dignity Health represents the alignment of two exceptional organizations with mutual missions of serving vulnerable populations while maintaining and enhancing access to care and improving the health of the communities we serve. We look forward to working together and forming lasting relationships with the San Joaquin County community to make a difference in peoples’ lives,” said Donald Wiley, President & CEO, Dignity Health St. Joseph’s Medical Center.

The next steps in the process are to develop work structures and a work plan and provide a report to the Board of Supervisors with the goal for the partnership to begin within 6-9 months. The LOI also provides strict parameters regarding this joint effort, including maintaining SJGH as a County hospital, and to ensure that it continues to provide care to low-income residents.

About San Joaquin General Hospital

Established in 1857, San Joaquin General Hospital and its related clinics together form the basis for the County’s safety-net health care system with 65% of its patients utilizing Medicare or MediCal. Additionally, SJGH provides the County with critical health care services as a level-II trauma center and a graduate medical education program that seeks to encourage graduates to continue to stay and serve County residents.

About Dignity Health & CommonSpirit Health

CommonSpirit Health, formed in 2019 by the alignment of Dignity Health and Catholic Health Initiatives (CHI), is a nonprofit health system with care sites in 21 states, committed to advancing health for all people and dedicated to serving the common good. With facilities such as Dignity Health St. Joseph’s Medical Center of Stockton serving their communities for over a century, CommonSpirit Health has a strong legacy of caring for the underserved, building healthier communities, and innovating health care.

The Letter of Intent is attached for your information.

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