Hospital patient gift fund problems persist


The I-Team has previously reported on how gift fund money for patients ended up paying for perks and parties for hospital staff. Administrators denied there was a problem, but after a lot of scrutiny and a state citation, they vowed to clean up their accounting. They assured the public that every dollar donated to residents would go to the residents. But that didn't happen.

Laguna Honda Hospital is a safety net for some of the poorest people in San Francisco who need long-term care or rehabilitation for injuries. Adjusting to life there can be tough.

"I'm glad it's there, buts it's pretty sad there. Those people are lonely," says Lorraine Chamberlain, family member of a patient.

Chamberlain knows. Her husband, S. Clay Wilson, is well known in the world of underground comics. He helped start Zap in the 1960s.

"He's an icon as an artist," she says.

In 2008, Wilson was found unconscious on a San Francisco street. What happened to him is a mystery. He suffered massive brain injuries and spent nearly a year at Laguna Honda.

Chamberlain saw first-hand what life is like for patients there.

"A lot of the patients there are, spend their day panhandling all the visitors that come in. They don't have any money to buy themselves a treat or a soda," she says.

That is where the gift fund comes in. It is supposed to provide small pleasures for patients, like a favorite food, a small TV, or a bus trip to Crissy Field. But our investigation last May showed how some hospital administrators misused the gift fund and spent tens of thousands of dollars on gourmet meals, gifts and barbecues for staff instead of patients.

Chamberlain remembers the lavish spread at the barbecue.

"Gorgeous looking food, really a lot of food," she recalls.

Nothing like the food patients were served. She decided to take her husband to the party.

"And this guy by the steps said, told us to move along, 'This is just for the staff only,' you know," says Chamberlain. "They didn't even want us looking at it."

When gift fund money started to run dry, the hospital was forced to make cuts to patient benefits like bus outings. That is when the state stepped in. The California Department of Public Health cited the hospital in May for failing to meet the recreational needs of patients.

It's not easy to figure out where the money is going at Laguna Honda, but there is still a lot of it moving around. New documents obtained by the I-Team show that just last February, administrators diverted $100,000 of interest from the patient gift fund to hospital accounts used for staff. Two checks totaling $37,000 from a non-profit that raises money for patients were both put in staff expense accounts. That was in 2006 and 2007.

We also found several small checks written to the patient gift fund over the last five years by families in memory of loved ones, but used for staff instead, and Laguna Honda took $1,800 out of a patient activity account to pay for a CPR class for nurses in 2008. After we aired our first story, they quietly put it back.

"Who do you think you feel the greatest gratitude to? Do you think you feel the greatest gratitude to the other residents or do you think you feel the greatest gratitude to the person who cared for your relative?" says San Francisco Health Director Mitch Katz who believes donor money given to staff is still benefiting patients. "Now obviously our critics do not believe that. They think that having high morale on staff and training staff has nothing to do with patients and that you would never mix them. I don't think most people believe that."

Shortly after our story in May, the San Francisco Controller's Office did a quick review of the gift fund and made recommendations. In September, Katz moved the $100,000 of interest and the $37,000 donations back into patient accounts. But he maintains that no money was misspent and that the gift fund is for both patients and staff. So hospital administrators rewrote the gift fund policy to say that.

"We change policies all the time," says Katz. "I'm not buying the idea that because that we knew 20 years ago what it was that residents most needed from the gift fund. I'm sure 20 years ago cigarettes were purchased from the gift fund."

But rewriting the policy is not OK with the state. They issued another citation to Laguna Honda Hospital a month ago. This time for trying to override San Francisco city code which says gift fund money is for the "general benefit and comfort of patients," not for staff.

"There's missing money, there's funds that are shifting, there's funds that have been renamed," says George Wooding who heads the West of Twin Peaks Central Council. "It's like how do you follow the money? Where is the money?"

Wooding has been a longtime advocate and fundraiser for the hospital. Now he's a watchdog.

"Once we started talking about money and the gift fund, people got very, very evasive," he says.

Wooding says his group has always had a great relationship with the hospital, but when they pushed to see the books, Laguna Honda shut them out.

"And that's a very sad thing now because the people in the community are very giving, they want the green light to go and help Laguna Honda residents," says Wooding. "They are part of our community, but we don't know, we don't have any green light, we don't have any communication whatsoever."

Despite the problems, Chamberlain is still hoping people will find a way to donate to the patients. She thinks all the attention will keep things going in the right direction.

"There's not a lot of people I think that have visitors at all and so they don't have a support system, and so lacking that, the gift fund would take care of their needs," she says.

The San Francisco controller is now conducting a complete audit of the patient gift fund. It was supposed to take six weeks, but that has now grown to 10. Meanwhile, Katz is moving to Los Angeles for a new job, and the CFO who oversaw the gift fund at Laguna Honda is leaving also, to take a job at Muni.

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