Sutter Health scrapped plans to build a flagship campus on property it owns in Emeryville, California, and instead is shifting its focus to outpatient care in the area, according to a Sept. 30 statement.
The health system announced those plans in early 2025 (see that story below), with a medical center of up to 200 beds as the centerpiece of a $1 billion investment into San Francisco's East Bay. It attributed its decision to "the lack of a clear and predictable regulatory path" related to California environmental and land use law.
"Over two years, we pursued relief under the California Environmental Quality Act, or CEQA," the statement reads. "Those efforts did not secure the certainty needed to advance the hospital project, leaving it vulnerable to litigation that could delay construction and new hospital services for years."
Accompanying plans surrounding outpatient services "including primary and specialty care, diagnostic services and outpatient surgery" are now the priority for that community, though Sutter said it's still keeping an eye out for another potential location for a future hospital.
"Separating these projects keeps healthcare investment moving and allows us to advance additional outpatient services that can bring care to patients sooner. No alternative location has been selected, and we are assessing several options that can support comprehensive hospital, emergency and specialty care and the infrastructure needed for the future."
Sutter said that services will not be affected at Alta Bates, another hospital in the area it was planning to relieve with the new build, and that it plans to keep supporting that campus until another hospital can be finished. It added that hospitals across California have and continue to face "legal and regulatory challenges [tied to] significant seismic deadlines, while efforts to modernize or replace facilities can be exposed to lengthy regulatory reviews and litigation. A different location alone will not resolve these challenges."
Feb. 19, 2025
Sutter Health investing $1B to build new California hospital, expand ambulatory care services
Sutter Health will invest $1 billion to expand its services across Northern California's East Bay region, including a new flagship campus in Emeryville.
The health system announced Wednesday that the campus will feature a new medical center with up to 200 beds as well as a regional destination for ambulatory care. The plans also leave room for future expansion, according to the announcement.
The ambulatory services complex at the 12-acre campus will feature a wide array of specialties and will offer imaging and laboratory services. It expects to welcome its first patients as early as 2028, Sutter said.
The 335,000-square-foot medical center will include labor and delivery, surgical services, intensive care, emergency care and neonatal intensive care. The facility will be designed with the potential to add additional patient rooms in the future.
Sutter is targeting a 2032-33 opening date for the medical center, according to the announcement.
“Our Emeryville campus project represents one of the most significant investments we’re making across our system over the next decade and is part of our broader vision to meet the community’s growing demand for expanded access to our services across the East Bay footprint,” said Warner Thomas, president and CEO of Sutter Health, in the press release.
Sutter said it will put a focus on recruiting both primary care physicians and specialty care doctors, breaking down patient barriers to appointments and referrals and investing in initiatives to bolster the healthcare workforce. It expects to have 190 primary and specialty care clinicians staffing the new campus.
Beyond building the new campus, Sutter said it plans to grow the behavioral health services offered at its Herrick campus in Berkeley. The health system's Alta Bates campus will continue to operate as an acute care facility until the new medical center opens in Emeryville and then will be overhauled to provide ambulatory surgery services, urgent care and potentially skilled nursing services.
The health system is also renovating a medical office building in Berkley to serve as a primary care facility that will also offer OB-GYN care, according to the announcement.
Additional renovations are in the works as well, Sutter said.
“Too many people face challenges in accessing the care they need," Thomas said. "At Sutter, we’re committed to breaking down those barriers—expanding care facilities, enhancing imaging capabilities, improving online appointment scheduling and collaborating with the Sutter East Bay Medical Group and our community physician partners to attract more primary and specialty care physicians.
"These efforts will allow us to care for more patients while also investing in programs and partnerships that build the healthcare workforce of the future—ensuring more people get the right care when and where they need it," he said.