By Jorge Mercado Friday, September 29th, 2023

A deal more than a decade in the making came to fruition on Sept. 29, when CEOs for both Sansum Clinic and Sutter Health announced the finalization of a partnership between the two nonprofit health care entities.

Based in Santa Barbara, Sansum is now part of Sutter Health, a Sacramento-based organization that operates a network of hospitals and clinics in Northern California. 

The agreement takes effect on Oct. 2, but Sansum’s integration into Sutter will happen over the next few years.

President and CEO of Sutter, Warner Thomas, declined to specify the financial details of the deal, but said “it is about a continuing reinvestment.”

“The owners of Sansum Clinic have really been the community of Santa Barbara, as represented by our volunteer board of trustees, and what will happen now is the fiduciary board of Sansum Clinic is going to be a Sutter Health Board,” Kurt Ransohoff, CEO of Sansum Clinic, said.

Thomas said that there have also been discussions to have one or two members of Sansum’s board join Sutter’s board.

“There will be a connection between the advisory board here and our own board as well,” he said.

As part of the agreement, Ransohoff will also be transitioning into a new role, though it has not been announced as of Sept. 29.

Asked about one of the more exciting things of this partnership, Ransohoff believes being affiliated with Sutter actually helps people who are looking for a job know about them.

“There is a tremendous shortage of internists and other primary care doctors in the community and that’s a significant priority,” he said.

“If (a person in health care) grew up in Santa Barbara, they may want to come back, but if they haven’t grown up in Santa Barbara, and they’re doing a fellowship or residency elsewhere, that Sutter name helps a lot in terms of just the recruiting.”

He added that “skating on thicker ice, financially,” will also be attractive to people wanting to start their career in Santa Barbara knowing “that this place will be here indefinitely.”

This move comes after Sansum announced in May that it had entered into exclusive negotiations for a possible combination with Sutter Health.

But in reality, the deal was first discussed in the mid-2000s, only to be dashed away because of the Great Recession and the difficulties it brought.

Ransohoff, Thomas, other key executives, physicians and community members gathered on Sept. 29 at Sansum’s 4151 Foothill Rd. campus, celebrating the fact that Sansum is now a member of Sutter Health.

“In 2007, we felt that being alone was very challenging and the first partner — which we could have chosen from the whole universe of systems — the first people we went to go talk to at that time was Sutter,” Ransohoff said to the crowd.

“In 2022, we decided we needed to get more serious about talking to partners and lo and behold, it felt like fate or destiny that Sutter was thinking about the world in the way that complemented the way we saw it,” he added.

“It took 50 years for our clinics to find the moment to come together but it was worth the wait.”

Santa Barbara government officials were also in attendance, including Benjamin Peterson from Senator Monique Limon’s office who presented a certificate to both Sansum and Sutter for the partnership.

“We value the legacy that Sansum has and we’re very hopeful for this new future partnership and more people who will be served by it so congratulations and thank you very much,” Peterson said.

Following the event, Thomas and other key members of both health care entities went on a tour of the newly-constructed operating rooms at Foothill Surgery Center.

Ransohoff noted that the reason for the expansion was because Sansum could not accommodate the demand for the patients it had.

“This partnership allows for those kinds of investments that would be challenging for us on our own as an independent organization. These kinds of things cost many millions of dollars,” Ransohoff said.

In a press release, Thomas said Sutter will “be making significant investments into Sansum Clinic and the community, both now and into the future so that together we can expand patient care across Santa Barbara County and the Central Coast.”

Some areas of early investment include advancements to Sansum’s ambulatory surgery center technology and services, bringing more advanced diagnostic imaging services and an imaging center dedicated to women’s health and expanding access to primary and specialty care in Santa Barbara and neighboring communities, according to the press release.

“Through strategic investment in the months and years to come and in close partnership with our aligned medical groups, we’ll continue to deliver on that promise as an integrated system,” Thomas said.

Asked about investments into attracting and retaining talent in regards to housing, Thomas said “we see the same housing issues in Northern California.

“So making sure we look into doing certain sign-on bonuses, compensation structures and other ways to help folks deal with their housing challenges is important. We haven’t talked about specifically what we would like to do here, but that is something we have to deal with,” Thomas said.

Thomas said they also want to work with and help schools grow by expanding clinical rotations so that they can train more people and educate more people and “build a pipeline” with those academic institutions.

Sansum, founded in 1921, was one of the first physician practices to convert to a nonprofit model in the 1970s. Two other pioneering nonprofits, Gould Medical Center and Palo Alto Medical Center are now part of Sutter, Ransohoff said. Coincidentally, Sutter Health was also founded in 1921.

“As health systems work to recover from the pandemic, costs – including labor, medicine and supplies – have increased sharply,” said Thomas in a press release. 

“At the same time, we have a growing Medicare population, an increasing shift to ambulatory care, and high consumer expectations around digital tools and technology. By integrating our learnings and best practices, we can better address these headwinds and grow, expand access and invest in the future of healthcare in California.”

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