By Ashly McGlone

SAN LEANDRO -- Nonprofit Sutter Health signed a formal agreement Aug. 1 to donate San Leandro Hospital to Alameda Health System, and a transfer of ownership is expected by Oct. 30.

The announcement came from Sutter officials Friday afternoon and details of the deal were not immediately available, although it includes a transition fund created by Sutter for use by Alameda Health System during the transition.

Sutter will donate all hospital assets, including the building, land and equipment, to the public health authority.

"This agreement is a significant milestone toward Alameda Health System's vision to expand access to quality, affordable care to our diverse community," AHS CEO Wright Lassiter III said in a statement.

Community members have long worried the 93-bed hospital, with operating losses as much as $2 million a month in recent years, would be closed or converted to a rehabilitation center and lose its acute care services and emergency room.

Lassiter has said he is committed to work with partners -- including the City of San Leandro, Alameda County and the grant-giving Eden Township Healthcare District -- to keep the hospital doors open and put it back into the black in three years time.

David Bradley, President of the Sutter Health East Bay Region, said in a statement, "Sutter Health's donation provides AHS and local health officials the flexibility to determine how to most effectively deliver health care services on this campus."


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It was unclear Friday afternoon if the agreement meant that Sutter would release Eden Township Healthcare District from paying $17 million in damages it owes for a lost court battle over ownership of San Leandro Hospital, something that Sutter had considered if the money was instead used to support hospital operations.

Directors of the grant-giving Eden Township district voted to raise up to $20 million to support the flailing hospital, but conflicts of interest may require the court's approval to make any support or redirection of damages legal.

Ashly McGlone covers San Leandro, San Lorenzo, San Ramon and the Washington Township Health Care District. Contact her at 510-293-2463. Follow her at Twitter.com/AshlyReports.