Thirty-five years after setting its sights on San Marcos, Scripps Health announced Monday that it will soon break ground on a medical campus within walking distance of a competitor, Kaiser Permanente San Marcos Medical Center.
In a statement, Scripps calls the new facility “Scripps San Marcos Medical Center campus,” meaning that there would eventually be two medical centers, each calling themselves San Marcos Medical Center on Discovery Street, a recently extended roadway branching westward from Twin Oaks Valley Road, a main North County thoroughfare providing direct access to Cal State San Marcos.
The site, which has already been graded and had underground utilities installed, would include a 200- to 250-bed full-service hospital and a 150,000- to 200,000-square-foot ambulatory care building. Chris Van Gorder, Scripps’ chief executive officer, said in a recent interview that the project, which still needs permits from the City of San Marcos, would start with the ambulatory building. The hospital is not expected to open until roughly 2031.
The project is estimated to cost about $1.2 billion.
That’s nearly the amount that Scripps planned to spend replacing Scripps Mercy Hospital San Diego in Hillcrest when the health system announced a $2.6 billion construction program in 2017. That plan included a $1.3 billion investment at Mercy and a smaller renovation plan at its sister campus in Chula Vista. While other parts of the plan, including a second new medical tower at Scripps Memorial Hospital La Jolla and additional buildings at Scripps Memorial Hospital Encinitas are now under construction, the Mercy investments have not broken ground.
Van Gorder confirmed that plans to build in San Marcos will mean a “pause” in building plans for the two Mercy properties. The executive said that the shift north is necessitated by the fact that the two southern hospitals “lose money.”
“Our plan is to keep them open, but it’s our hospitals in the north which, frankly, fund the survival of our hospitals in the south,” Van Gorder said. “That’s why, from a business perspective, I need to make sure that we retain our strength in the north.
“We have a lot of patients up in that area, and they want us to be up there with ambulatory care and with an acute care hospital.”
There are, though, other forces at work in the local health care marketplace. After decades of operating hospitals only in San Diego proper, Kaiser Permanente opened its San Marcos Medical Center in 2023. Just a few miles to the east sits Palomar Medical Center Escondido, a $1 billion state-of-the-art facility opened in 2012.
Suddenly, San Marcos is looking like a health care hub similar to La Jolla or to the Sharp HealthCare and Rady Children’s Hospital megaplex at Genesee Avenue on Highway 163.
“Let’s face it, there are a whole lot of people trying to move into the north right now,” Van Gorder said. “UCSD wants to be in the north, Sharp wants to be in the north.
“Why do they want to be in the north? Because that’s where the financial stability is.”
Van Gorder’s comments appeared to refer to the current situation at Palmar Health, which is working on an investor-mandated turnaround plan after breaking its revenue bond covenants in 2024. Sharp loaned Palomar $25 million last year and the two organizations signed an exclusive negotiating agreement. UC San Diego Health recently followed suit, loaning Palomar $20 million.
While Palomar’s elected board of directors has publicly stated that it intends to remain independent, many are watching the interaction between these organizations with extreme interest.
It is clear that Scripps’ interest in inland North County long predates the current blocking and tackling going on at the moment.
Scripps purchased an 80-acre parcel on what is now Discovery Drive just west of Twin Oaks Valley Road and just south of state Route 78 in 1990, eventually selling all but 13 acres of the land, which is now under commercial and residential development.
Van Gorder said Scripps still plans to pursue its big plans for its southern hospitals, though not until after the San Marcos hospital opens. Financing both simultaneously, he said, would be too heavy a lift.
Both facilities are listed among the state’s slate of aging hospitals that need further seismic upgrades by 2030, the date by which they must be upgraded or no longer used for inpatient care. Given the six-year time estimate to build a new hospital in San Marcos, there is no way that major seismic work at Mercy will be finished by 2030.
The state lists Mercy buildings in Hillcrest and Chula Vista as needing seismic work in category 2 or greater. Category 2 is defined as those buildings whose seismic deficiencies “do not significantly jeopardize life, but may not be repairable or functional following strong ground motion.”
Van Gorder said that Scripps is among those organizations currently lobbying for further changes to the state law that mandates seismic upgrades to medical buildings.
“We need changes to the 2030 seismic law to accommodate the challenges we face throughout our system — not just with Mercy San Diego, but with Scripps Encinitas and Scripps Green Hospital in La Jolla,” Van Gorder said.
“And we are not alone; hospitals across the state are in this situation.”
