Former De Paul rebrands itself as Valley Health Center in Morgan Hill

Morgan Hill Life file photo
Former Santa Clara County Supervisor Mike Wasserman speaks at a 2019 rally to save three medical facilities, including St. Louise.

By Marty Cheek

Five years ago, the future of healthcare in Santa Clara County looked uncertain. St. Louise Regional Hospital in Gilroy, O’Connor Hospital in San Jose, and the De Paul Health Center in Morgan Hill were on the brink of closure after their parent company, Verity Health, filed for bankruptcy in 2018.

The potential shuttering of these facilities threatened to leave more than 100,000 residents in the South Valley area without convenient access to essential medical services, recalls Mike Wasserman, then the county supervisor representing District 1, which includes the South Valley.

“It would have been such a travesty if South County had lost St. Louise and De Paul,” he said.

Photo by Marty Cheek

Recognizing the critical role these hospitals played in the community, Santa Clara County stepped in with a bold solution. The board of supervisors proposed the county acquire the three healthcare facilities for $235 million, bringing them under the umbrella of Santa Clara Valley Healthcare (SCVH).

The move was not without challenges. Then-California Attorney General Xavier Becerra initially attempted to block the sale, the only offer made, demanding the county adhere to specific conditions regarding service levels and patient protections. The county argued those conditions (initially required for Verity’s purchase of the hospitals from the Daughters of Charity) did not apply to a nonprofit government agency.

“I have no idea what the state’s attorney general’s problem was and why he was fighting (the purchase). We were the only entity that made a bid,” Wasserman said. “If the county had not stepped forward to make this happen, the medical facilities of St. Louise and De Paul would have been gone, all the people at all levels that operate and make those facilities function would have lost their jobs. Gilroy, San Martin, and Morgan Hill would have lost the closest top-notch medical facility possible. It was amazing there was so much resistance.”

Photo by Marty Cheek

Local residents, hospital staff, and county officials rallied to oppose the Attorney General’s efforts, emphasizing any delay in the sale could lead to the permanent closure of the hospitals. In a pivotal moment, a bankruptcy judge denied Becerra’s request to postpone the sale, stating a delay would likely reduce healthcare availability for the public. With this ruling, Santa Clara County was able to proceed with the acquisition in March 2019, ensuring the continuity of vital medical services.

Now, as SCVH marks the fifth anniversary of this momentous expansion, the positive impact is evident. During the past five years, O’Connor Hospital and St. Louise Regional Hospital have experienced remarkable growth, with substantial increases in inpatient days, emergency room visits, and surgical procedures.

These hospitals played a crucial role in serving the community during the COVID-19 pandemic, providing essential care to those in need, said Gloria Dela Merced, St. Louise’s chief executive.

“Can you imagine if we were not part of the county during the pandemic?” she asked, recalling the overwhelming number of COVID-19 patients nurses and doctors treated. “The amount of resources we had during the pandemic, it’s really a blessing for us to be part of the larger system because we could leverage our resources.”

The mass shooting at the Gilroy Garlic Festival on July 28, 2019, that resulted in three people killed and 17 injured, might have resulted in more fatalities if South Valley’s medical facilities had been shuttered, she said.

“We are fortunate St. Louise was here. We have an emergency room. We have an OR (operating room). We have an ICU (intensive care unit),” Dela Merced said. “We were able to readily assist the victims of gun shots.”

Before the county’s purchase of the three facilities, SCVMC annually served as the single safety-net public hospital in Silicon Valley and provided more than 63,877 emergency visits, 121,425 hospital inpatient days, and about 10,000 surgical cases. The three-hospital system has grown together to provide 173,943 ED visits, 220,365 hospital inpatient days, and more than 18,848 surgical cases, while serving more than 400,000 individuals annually.

Santa Clara County’s commitment to investing in these healthcare facilities has been unwavering, Dela Merced  said. Upgrades to medical imaging equipment, the opening of new outpatient clinics, and the expansion of specialized programs such as bariatrics, TAVR (transcatheter aortic valve replacement), and robotic surgery at O’Connor Hospital have enhanced the quality and range of services available to patients.

St. Louise Regional Hospital has also seen significant improvements, including the addition of a SAFE (Sexual Assault Forensic Examination) program for victims of abuse, the implementation of a new electronic health record system, and the purchase of a state-of-the-art CT scanner.

What was the De Paul Health Center has been converted by the county into the newly named Valley Health Center, providing additional medical and health care for South Valley residents.

The successful integration of these hospitals into SCVH has not only preserved access to healthcare but has also fostered a sense of community and collaboration among the medical professionals who serve Santa Clara County, Wasserman said.  The efforts of doctors, nurses, and staff have been instrumental in providing compassionate, high-quality care to patients, even in the face of unprecedented challenges.

“It’s what the county does,” he said. “The county provides services for its residents and medical services are on the very top of that list along with public safety.”

As SCVH and the county board reflect on the five-year journey since the acquisition, the medical care organization remains committed to its mission of promoting better health for all residents, said Santa Clara County CEO James Williams.

The expansion of services and the resilience demonstrated by these hospitals serve as a testament to the power of community-driven healthcare and the importance of investing in the well-being of local residents, he said. The active involvement of South County residents in rallies, letter campaigns and petitions helped in saving the hospitals through the county purchase from Verity, he said.

“Hearing first-hand how critically important the community viewed St. Louise and VHC Morgan Hill bolstered our belief that losing these medical facilities would be a heartbreaking loss,” Williams said. “It also made a huge difference when we faced opposition from the AG. Healthy communities make stronger communities and this was the right investment at the right time. We are happy to see how well this has paid off with increased patient visits, more full-time employees, and better health care for all.”