chair chu: welcome to the reconvening meetings of the board of supervisors subcommittee. mr. clerk, do you have any announcements first? clerk young: yes, please turn off all cell phones and pagers. if you would like to speak, please fill out a speaker card. if you have any documents you would like to present, please provide a copy to myself for inclusion in the file. any actions taken on today's agenda will appear on the board of supervisors' march 9 agenda, unless otherwise stated.

chair chu: would you call item no. 5, please? clerk young: that would be march 8. sorry. i missed the date. item 5, an emergency hearing regarding the closure of lyon- martin health services, the impact on their client base, and provisions for continuing care or additional emergency support from the city and council of -- and county of san francisco. chair chu: i am joined by supervisors kim and mirkarimi, and also, supervisor wiener is

here. supervisor mirkarimi? supervisor mirkarimi: just some opening comments. the board of supervisors has not had a meeting on this to date. we learned about six or seven weeks ago about the possible closure an imminent closure of the health center. needless to say, we were all extremely concerned and troubled, and what we really saw in rapid fashion was a really impressive response from the community, not just from those on behalf of the 2500 patients at the lyon-martin health

clinic, but others in the community. diverse communities throughout the city and county of san francisco. people in the community through a grass-roots efforts hit -- efforts, they have answered the call to try to raise cash quickly and to fill a financial void, one that we will dissect in today's hearing to stave off that imminent closure. it did not garner just city attention but national and international attention, because this clinic, the lyon-martin clinic, is very important. it is part of our help strategy in san francisco. how and what we must do to make

sure this clinic is sustained and well supported, both through a private and nonprofit mechanism and the public mechanism, that is what we are going to explore here today. part of this hearing is to understand how it got to the point that it did. it is not necessarily about winding fingers -- wagging fingers, but also trying to make sure that this does not happen again. we will hear from the city family, department of public health, a consortium, and others, including people from lyon-martin about what happens with the financial crisis that led up to the imminent closure and what we can do to make sure that does not become a repeat scenario. and this may not be the only clinics facing this type of

danger. this could be an indicator of other clinics because of the downturn in the economy nationally. certainly, in california. this may be a harbinger of things to come. seeing that we attend to these kinds of crisises, establishing warning signs, that i do not think were there initially with the lyon-martin health clinic, that we are able to respond in a way that is not just community driven, although this time, if it was not for the community, i fear that the clinic would not have been opened even for this period of time. i look forward to hearing a thorough vetting. there is an assessment that was done by the clinic consortium, it reports that has been disseminated to us, and an

opportunity -- a report that has been disseminated to us. the preservation of the lyon- martin health clinic. i know that everyone on the board of supervisors is concerned, and i appreciate the support of supervisor wiener and supervisor campos. it was not scripted. there were no political consultants. i think you can see the concern of people from all vantage points, who tried to do everything they could to help answer the questions of how we got here and what are we going to do to get out of this jam. i am a pro representative of district 5, which happens to

include the lyon-martin health clinic, and that is also why i wanted to do everything i could -- i am a representative of district 5. there is a list of speakers. chair chu: thank you, supervisor mirkarimi. supervisor wiener? supervisor wiener: i want to thank supervisor mirkarimi and everyone for coming. i am happy to be here. i do have to leave at 4:30, so i just wanted to make sure you know that. i have been in very close communication with supervisor

campos, the department of public health, and lyon-martin, and i will be involved in trying to make sure this clinic survives. chair chu: supervisor mirkarimi, would you like to announce people? supervisor mirkarimi: yes, we have these people. >> i want to thank you all for having this hearing. i think that as supervisor mirkarimi indicated, this is part of our community. thank you. this hearing really provides an opportunity to do a number of things, not only provide the community and the supervisors

with a sense of the financial situation that lyon-martin faces, but it is also a opportunity to see how this really has brought a much increased and concerted effort by the board of directors, by the executive administration, by the department, and by the consortium to really work together to resolve this issue in a manner that suggests, as appropriate, really what should be and what can be the long-term sustainability of the organization. if, in fact, the current organization as it is configured then how can we altogether work for a situation that allows for continued financial viability and

services and also the assurances that, quite frankly, we all want to have, that the organization is governed appropriately and is administered as such, so with that, i am first going to turn it over to lyon-martin. we have their board chair. their medical director, who was come unto previously, the executive director -- who was, until previously, the executive director. and we have another. they combined will goat -- go through what is being implemented for lyon-martin, and then they will turn it over to

someone who will talk about the overall entity for which lyon- martin contracts with, their ability to facilitate in student organization, -- and steer the organization. i will then come back and give essentially the city's investment in lyon-martin and how we are working to vote ri -- to right this ship. >> thank you for being with us. i first want to give a bit of a bio. supervisor mirkarimi: your name for the record, please? >> winter. i have been on the board for about 3.5 years.

i came about five years ago as a patient. i found out about lyon-martin because i was telling a friend of mine the problems i was having getting good health care. i have a great health care. i am a software engineer and have been one for over 20 years. but my doctor said to me one day, "i am not sure if i should give you a prostate exam or a breast exam." i said, "maybe we should look on the web." i know the transgender community, and i still cannot find anyone to take care of me. this friend pointed me towards. -- towards lyon-martin. they are a well educated staff,

and i had a decent doctor. i wanted to this organization to exist. i sought its value. i sought is a value to people like me -- i saw its value. i saw its value to people like me and others. a year later, i was asked to be chair, so that is my history. i am the first and only transgendered person on the board. i will go into more written statements now about the state of things. lyon-martin has been on the verge of extinction many times. they have faced difficulties in getting money for services performed. as a result, they have been extremely cash poor. the board were shocked, however,

to recently realize the full extent of the deterioration financially, including what was being done to make ends meet. a board of directors governing a community health clinic should know the right questions to ask and the right people to ask. to learn of these sorts of things at the time they are happening. the current board did not have that knowledge or expertise, so they did not ask those questions. for that, we take responsibility. thanks to the outpouring of financial support lyon-martin has received from the community, many of whom are here, during the last few weeks, we have been able to hire consultants with the administrative, financial, and operational expertise to

turn this clinic around. the board is committed to keeping this clinic open but only if it can be done sustainably. we cannot remain dependent on the generous outpouring in financial support the clinic has received from the community for the past few weeks. we believe that with significant changes in the way the clinic is structured and managed, there is a point in 2012 where lyon- martin should be able to establish sufficient income to pay its expenses and pay down debt. maintaining operations long enough to meet that. we have a turnaround team in place that is providing it lyon -- that is providing lyon-martin with many directors. they have experience working

with federal qualified centers in situations similar to the one that is being faced by lyon- martin. at this time, we anticipate that the turnaround team will be in place for several months, until the clinic's survival becomes more certain. at that point, we plan to hire a director and director of finance. the board welcomes its own a transition as well and has been actively recruiting new board members. pro bono legal counsel has been made available to anyone who would like to join the board. there are questions about potential liability. given the current balance sheet, adding new board members has proven to be a challenge. we are confident that as the balance sheet improves, we will

have an influx of new members to allow the current board to step down. another can break down the details for you and talk about the initial help required for lyon-martin to survive, but i want to take this opportunity to thank you and the community for helping us. we never imagined the community would be able to provide the clinic with the financial wherewithal to stay open these past weeks and bring these experts in in hopes of turning this around. a key for coming here today and for your continued support as the note -- thank you for coming here today and for your continued support for the clinic. thank you very much. supervisor mirkarimi: thank you very much. anyone else from the lyon-martin

clinic? >> i have been the interim executive director up until yesterday, when the new one took over. just to give you a sense of who i am, i am a physician. i trained at columbia and did a residency program in the bronx. i worked in new york for many years. i worked in san francisco as a director that is a federally qualified health center. i left after five years to come here to take a job at lyon- martin, which is why i came here, and i have been at lyon- martin for the past five years. i was serving as two directors at the same time.

this is training has to be leaders in california around health care. as a physician, i think i have a unique perspective on the patients that come to us and that sort of thing. our mission is to provide excellent health care to women in transgendered people in a safe and compassion environment with empathy to their gender identity, and we have always done that regardless of their ability to pay. about half of the patients were identified as l, g, b, orr -- or t, and then there are those that come to us because they just like our care. there are some people love mental-health issues and find us a safe place to get their care. what i see going in to talk with

patients a day in and day out is how valuable our patients feel our services are, how important they are, and lyon-martin is unique in that we are the only clinic in the country that focuses on lesbian and transgendered people. there is the nation's guy for how we provide health care for the next few years -- the nation's a guide -- the nation's guide for how we provide health care for the next few years. lyon-martin is a national model. we have received an award for the care that we provide to the lesbian and transgendered community. i am going to give you a little bit of a sense of how we got to

the place we are and then speak to how we move forward. one of the challenges is that we really do serve an underserved community. it is a challenging mix. about half of our patients are uninsured, over half, haute -- over half, and that means they pay us about $5 per visit on average. a visit costs about $300. during the time of 2009, 2010, when there was a downturn in the economy, there was also a failure in the management at lyon-martin, which led to a breakdown in our third party billing and other issues. at the time, the clinic was extremely cash poor, and yet, the clinic continued normal operations. executive management resorted to

various a desperate measures in an attempt to stay afloat, and the board was not aware of the actions that were happening at that time. all of this really came to light in early december, when we sat down and said, "where are we?" it became clear. what i will say is that i feel very honored to work at lyon- martin. i am very lucky to have that job, but it belongs to the public. there is no way we could have survived without the help we have received financially and otherwise from the community, and we are incredibly grateful for that. the donations we have received have allowed us to stay open. however, we will not be able to stabilize this without bringing in turnaround specialists and other experts in the field in

order for us to maximize our reimbursement for services and provide consistent leadership. without the community support, we would not have been able to bring them in, and we have started to do that, which is exciting. i will turn it over to our turnaround executive director. i will turn it over to our consultants, who has been very helpful to move forward. >> she really is excited about him being here. good afternoon. my name is jean. i am a registered nurse. i started working in the community about 1986. i helped run a network of health centers, similar to the consortium, including in bernie lo county, and about five years ago, -- including in yolo

county. i have been involved for about a month now working very intensively with lyon-martin and their board and their staff and their legal counsel, and it is clear that the responsibility is a shared responsibility, between the executive director, management, in the board. as you may have heard, there is over $1 million in debt in both long-term and short-term debt, some of which must be addressed immediately, and other parts of that debt could be paid over a longer time. the $300,000 that has already been raised has been used to support mission-critical expenses, such as rent and salaries, some consulting costs, laboratory fees, other

operational expenses. as we kind of transition some of these programs to other agencies and to retain the consultants to assess the financial situation, it has been a very dynamic and fluid time, and we have been running as best -- as fast as we can. financial analysis has shown that without an immediate infusion of cash in the amount of about $500,000 by month's end, the clinic will be in a negative cash flow again. based on current cash budget projections, the clinic needs a cash infusion to operate, pay down the debt, and have a reserve adequate to carry them through the months when cash will not meet their expenses. the board is committed to keeping the clinic open. if it can be financially stable. in order to do this, cash has to come in and be raised now.

if not, bankruptcy will need to be filed in a timely fashion where there is still cash to be able to transfer patients and cease operations. we do have a closure plan, should that be necessary, and we have been working closely with the department of public health, should that have to happen, and also, the san francisco clinic consortium has been extremely helpful in providing their staff as well as their leadership to help us work through some of our issues and identify some of where the problem areas are. we are hoping to smoothly transfer patients to other places if that becomes necessary, but, obviously, that is our very last resort. throughout these past weeks, the staff has continued to put patients first. it is amazing to me. i have spent time in thcl