Santa Cruz Medical Group dissolves after Dignity Health talks fail; 20+ physicians exit, tightening county referral capacity

The Santa Cruz Sentinel reported on July 25, 2026 that failed contract negotiations between Dignity Health Medical Foundation and the roughly 120-member Santa Cruz Medical Group led to the group's dissolution and the departure of more than 20 physicians, including at least 10 in primary care plus specialists across OB-GYN, ICU, urology, hematology/oncology, endocrinology, gastroenterology, and rheumatology.

Patients report difficulty finding replacement physicians and long waits. Separately, a June 1 notice covered 22 support-staff layoffs at Dominican Hospital, with an informational picket held June 30.

SCOPE NOTE: the departing physicians and Dominican Hospital are not FQHC employees. The health-center relevance is downstream: specialty referral availability and unassigned primary-care patients in a county where Santa Cruz Community Health and Salud Para La Gente are the FQHC network.

Neither health center has published a patient-volume figure tied to these departures, and the per-physician panel estimates circulating locally are not health-center data, so no displaced-patient count is asserted here.