The next thing she knew she was in the hospital

In the Longman Phrasal Verbs Dictionary, it says:

look away
to turn your eyes away from someone or something so that you cannot see them:

Shirley looked away from the road in front of her for a second, and the next thing she knew she was in the hospital.
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Which of the following sentence does it mean?

a. [the next thing (that) she knew] she was in the hospital.
b. the next thing [she knew (that) she was in the hospital.]

Would you please help me?
Thanks!

PS I also posted the same question on https://www.usingenglish.com/forum/threads/252216-the-next-thing-she-knew-she-was-in-the-hospital?p=1335082#post1335082, but all of your answers are unique to me. Hope we can discuss with each other. Thank you.