The Alliance provides $3 million grant to Pajaro Valley Healthcare District Project to support proposed purchase of Watsonville Community Hospital

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Grant aims to ensure area residents maintain access to critical health care services

Scotts Valley, Calif., Jan 18, 2022—Central California Alliance for Health (the Alliance), the Medi-Cal managed health care plan for residents in Merced, Monterey and Santa Cruz counties, will provide a $3 million grant to Pajaro Valley Healthcare District Project (PVHDP). The grant, made available through the Alliance’s Medi-Cal Capacity Grant Program (MCGP), aims to support PVHDP’s proposed purchase of Watsonville Community Hospital. Today, the Alliance’s board of directors voted in support of the grant award.

“Watsonville Community Hospital is a critical provider of needed health care services to Pajaro Valley residents, many of whom are Alliance members,” states Alliance CEO, Stephanie Sonnenshine. “PVHDP’s proposal to create a healthcare district and to purchase the hospital fully aligns with our mission of accessible, quality health care guided by local innovation. We are pleased that our board voted to make grant funding available to support local action to ensure that Pajaro Valley residents keep access to needed health care services in the community.”

In December, Watsonville Community Hospital reached a preliminary agreement to sell its operations to the new healthcare district sponsored by PVHDP, a not-for-profit organization created by the County of Santa Cruz, the City of Watsonville, the Community Health Trust of Pajaro Valley and Salud Para La Gente. Introduced by Senator John Laird and Co-Authored by Senator Anna Caballero, as well as Assembly members Robert Rivas and Mark Stone, this pending legislation creates the Pajaro Valley Health Care District, if approved by the California state legislature and signed by the Governor. The Alliance’s board has approved a letter of support for that legislation, SB 418.

The sale will likely be completed through a Chapter 11 reorganization, which will allow the hospital to focus on patient care and operations while the sale is conducted. The facility remains open and is offering services to patients.

The MCGP was established by the Alliance in 2015 following the Affordable Care Act’s implementation the previous year, which placed sudden growth demands on the health care delivery system. The MCGP seeks to improve the availability, quality and access to health care and supportive services for Medi-Cal members in the Alliance’s service area. Since its inception, the Alliance has awarded more than $125 million in grant funding through the MCGP to 138 organizations serving local Med-Cal members.

Central California Alliance for Health (the Alliance) is a regional Medi-Cal managed care health plan, established in 1996 to improve access to health care for nearly 380,000 members in Merced, Monterey and Santa Cruz counties. Using the state’s County Organized Health System (COHS) model, the Alliance delivers innovative community-based health care services by connecting members with providers that deliver timely services and care, focused on prevention, early detection and effective treatment. As an award-winning managed care health plan, the Alliance remains focused on efforts to improve access to quality health care for its members. For more information, visit www.thealliance.health.


Linda Gorman is the Communications Director at Central California Alliance for Health (the Alliance). She oversees the Alliance’s strategic communications plan across all channels and audiences, identifying opportunities to raise awareness about the Alliance and key health topics. Linda has been with the Alliance since 2019 and has over 20 years of marketing and communications experience in the not-for-profit, insurance, and health care sectors. She holds a Master of Arts degree in Communications and Leadership.