Santa Cruz County supervisors fund X-ray center for another year but budget cuts loom

After a summer stalemate with a county labor union delayed government plans to shutter two safety-net health services and lay off employees, the Santa Cruz County Board of Supervisors on Tuesday came to a final decision. 

After Sept. 30, the county will no longer run its own blood-draw services at its health centers in Santa Cruz and Watsonville. Instead, it will contract out the service with Quest Diagnostics, the company that already tested the blood samples drawn by county phlebotomists. Quest will set up shop in the county’s Santa Cruz and Watsonville facilities, minimizing the interruption to services. The move will result in one layoff, as four other blood lab employees found other work, and another has chosen to retire. 

However, the supervisors voted to avoid closing the public radiology facilities after raising concerns that such a move would more severely disrupt services for the uninsured and vulnerable populations that use them. Instead, in a 4-1 vote, with District 1 Supervisor Manu Koenig dissenting, supervisors agreed to pull roughly $400,000 out of an already depleted reserve to fund its X-ray program through June 30, 2026. The decision saves two layoffs, for now. 

The proposal earlier this year to end the radiology and blood lab services served as a siren call for a new reality in which limited federal and state funding meant unavoidable budget cuts and a deteriorating social safety net. Blood tests and X-rays represent crucial elements of diagnostic and preventative health care to a largely uninsured, vulnerable, sometimes undocumented and often homeless population throughout Santa Cruz County. Without the services, local health care professionals and doctors warned that “people will die.”

In supporting the move to continue funding X-ray services, Supervisors Justin Cummings and Felipe Hernandez said they wanted to give new Health Services Agency Director Connie Moreno-Peraza more time to work with staff to try and keep radiology services in house. 

“This is just for this fiscal year, and when the budget comes back and if it turns out we can’t maintain the services, then so be it, we can move forward with the cuts at that time,” Cummings said. “We have a new director, and if we can’t keep the [blood] labs, let’s at least give her the opportunity to see if she can maintain radiology in some way, shape or form.” 

The supervisors’ decision went against the recommendation of County Executive Officer Carlos Palacios, who urged them to not dip into the government’s already limited reserves to save the radiology services. Palacios said federal cuts to the social safety net and changes to Medi-Cal, the state health insurance program, were setting up the county for more pain in the coming years. 

“We’re going to be in a big battle just to keep our clinics open over the next few years, just as the hospitals are going to be in a battle just to stay open,” Palacios said. “Know that in the next year’s budget you’re going to see more cuts, and they’re going to be more severe.” 

Santa Cruz County has already observed parts of its social services drying up. Telos, one of the county’s only mental health facilities, closed over the summer. Planned Parenthood’s Santa Cruz location shuttered in July, and the Downtown Streets Team announced it was ending its homeless outreach services on Oct. 31. Watsonville Community Hospital also announced it was searching for a partner to help subsidize its operation as budget cuts loom. 

Palacios called the decision to dip into reserves to fund radiology on a one-time basis “a bad practice.” 

Koenig said he couldn’t support spending down the county’s savings account when the financial forecast for the county is so bleak. 

“It’s not like staff wants to be making these recommendations; these [closures] are just the least bad option,” Koenig said.

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