Though construction has been complete for nearly one year, the 16-bed mental health care hospital at Tri-City Medical Center in Oceanside still has not opened. And despite holding a groundbreaking ceremony last September, building still has not commenced on a 120-bed behavioral health facility on the campus of Palomar Medical Center in Escondido.
These delays have occurred at a time when North County has become a desert for inpatient mental health services. Both organizations eliminated all inpatient mental health care, with Tri-City closing its 18-bed unit in 2018, citing financial and regulatory difficulties, and Palomar gradually reducing its services from 22 to a dozen beds in 2020 and then eliminating the remainder last year.
Meanwhile, North County’s nearly 1 million residents living along the state route 78 corridor continue to live without a local hospital capable of providing treatment in locked units for those whose need for mental health care is deemed to be severe.
County records show that from July 1, 2024, through June 30, 2025, 1,011 Medi-Cal patients who live in North County received inpatient treatment in facilities located in the City of San Diego, with Sharp Mesa Vista Hospital in Serra Mesa and the San Diego County Psychiatric Hospital on Rosecrans Street in the Midway District being the most-common hospitalization locations, meaning that family members face much-longer round trips to visit their loved ones than they did when such services were available at Tri-City and Palomar.
The closest location accepting Medi-Cal and private inpatient mental health care admissions is Aurora Behavioral Health, in Carmel Mountain Ranch, though county records show that this location admitted just 10% of all North County referrals in fiscal 2025, with the remainder having to travel significantly farther south for care.
Those numbers do not include North County residents with private health insurance, meaning that the actual impact of not having inpatient services in North County is significantly greater than Medi-Cal counts indicate.
The county behavioral health department has managed to take the pressure off of both hospitals by opening crisis stabilization centers in Vista, Oceanside and Escondido. Taken together, those three facilities, which provide quiet spaces and recliners where those in crisis can be evaluated for up to 24 hours, served 2,702 patients during the 2024-25 budget year. Such cases, often picked up by law enforcement officers during emergency calls, would otherwise have ended up in hospital emergency departments, contributing to overcrowding, or would have been taken to hospitals in San Diego, forcing law enforcement officers to leave their beats for hours.
While there has been progress, those with loved ones still being sent south for hospitalization have waited years for local inpatient capacity in secure units to be restored.
Both organizations have been less than forthcoming about exactly why these vital resources, supported at all levels of local government, have taken so long to move from plans to patients.
When asked whether the still-unbroken ground at its mental health hospital building site indicates that the project is stalled, Palomar Health said in May, “The project has not been delayed. It is not unusual in the construction process for these projects to take some time.
“We look forward to continuing to work together to build and open this facility.”
Palomar said in May that it would not address any further questions on the matter.
The organization’s own statements show that the project was originally estimated to open in 2024, with opening day now said to occur in 2027, according to the organization’s latest statement in May, which announced a $50 million state grant to help pay for the project’s construction. The public health care district has struggled with severe budget problems in 2024 and 2025, though it is not clear to what extent the ongoing implementation of Palomar’s financial turnaround plan has impacted plans for the behavioral health hospital.
Tri-City has likewise struggled to quickly regain space for those who need to be admitted for inpatient mental health care services. The county Board of Supervisors approved construction of a 16-bed stand-alone mental health hospital on the hospital’s Oceanside campus in 2020. Officials said this week that they expect the facility to finally open in November or December.
At a regular meeting on Tuesday, county Supervisor Jim Desmond asked why the project still hasn’t started serving patients.
“Is there any end date soon, because I took a tour of it (when) it was done a year ago, and it still isn’t, I guess, in use at this point in time,” Desmond said.
Nadia Privara Brahms, acting director of Behavioral Health services for the county, said the project has faced some “challenges in terms of getting the agreement” between Tri-City, the county and Exodus Recovery, the private company that will run the unit when it opens.
“It has been a bit challenging, but we imagine that it’s going to be open, hopefully by the end of this year,” Privara Brahms said.
A copy of an operating agreement between Tri-City and the county was only signed on May 20. County officials declined to say more about exactly what those challenges entailed, and Tri-City was similarly vague. The agreement documents that the county paid for the total construction cost of $27.6 million, but expects Tri-City to repay half of that cost, less $1.8 million in land value, back to the county in the form of a zero-interest loan. However, the agreement credits Tri-City’s loan payments for providing a long list of services to the new mental health hospital, everything from food and medical services for patients being treated there to custodial staffing, landscaping and linen services.
It’s a very detailed operating plan, right down to the hospital providing mental health patients with three “balanced and complete meals each day, with snacks and beverages … that follow the same menu as the Operator’s hospital.”
But why it has taken so long for the two parties to come together on these details, especially since the initial deal was approved in 2021, is not specified.
Dr. Gene Ma, Tri-City’s chief executive officer, declined in an email sent Tuesday to provide deeper details.
“I wish I could pinpoint one reason, but (there were) lots of complicating factors in a complex, multiparty discussion,” Ma said. “But all parties wanted to expedite this community need, and we’re excited to be moving forward now!”
An initial licensing application filed on July 6 was returned for corrections, and the partners must get those changes made by Sept. 3 or face resubmitting the application, Ma said.
Luana Murphy, Exodus’ president and chief executive officer, said she has no concerns that the licensing effort will be successful.
“This facility is going to be part of a wonderful system of care,” Murphy said. “It has been a long time coming, yes, but we’re very close.”
Murphy, who said her company operates similar facilities in two other California counties, said another factor that had some bearing on the process was the state’s change in reimbursement methods for mental health care services. Under a “CalAim” reform program, payment has moved from reimbursement of actual costs incurred to a flat “fee for service” model.
“The county and Exodus were negotiating an operating agreement during the time when all of mental health care is kind of going through an upheaval of sorts, in that the methodology for payment has changed, and everybody’s kind of struggling with ‘how is this going to work?” Murphy said.
While the Tri-City project has struggled to finish, Palomar’s plans to build a modern mental health hospital have failed to begin.
That fact is made all the more noteworthy given that Palomar held a groundbreaking ceremony for it on Sept. 12, 2024.
A public statement promoting the event says that the mental health hospital was to be “developed through a joint venture partnership with Lifepoint Behavioral Health,” a private Tennessee-based company that operates two dozen similar facilities nationwide.
At the time, there was no mention of a need for additional funding. Officials announced that the new resource would open in 2026, complete with inpatient beds for a wide range of patient types, an extensive outpatient program, and even including a special unit for military veterans.
But, rather than beginning to build, the project has remained on an unannounced hold, popping up in the spring on the state’s list of first-ground grant recipients and receiving a $50 million award for a project estimated to cost $104 million.
Palomar did not respond when asked why it needed to request grant funding for a project that it deemed last year to be well enough funded to hold a groundbreaking ceremony, gathering dignitaries to celebrate a project that appeared, nearly one year ago, to be a done deal.
It is clear that the state did not take the groundbreaking event into account in its decision to award Palomar a Proposition 1 grant.
The California Department of Healthcare Services oversees the $6.4 billion Proposition 1 grantmaking process and said in an email that it “does not possess all funding specifics for the proposed projects referenced at the 2024 groundbreaking event.”
The email further said that the state’s role is to “ensure that awarded (Proposition 1) funding would enhance behavioral health capacity rather than supplant funding for this project.”
Proposition 1 does mention supplantation in its full text, stating that “these funds shall not be used to supplant existing state or county funds utilized to provide mental health services.”
It does not appear that the finance plan that Palomar submitted in its application included state or county mental health care funds. A basic financial breakdown included in its state grant application assumes that a $50 million contribution from the state and has private investment making up $19.1 million of the project’s $104 million total cost, with the remaining $35.4 million to “be funded by a conventional construction loan.”
Originally Published: August 31, 2025 at 6:15 AM PDT