Let’s wait a while
Council concerned over Christ Hospital sale
by E. Assata Wright
Reporter staff writer
Oct 30, 2011 | 4241 views | 0 0 comments | 12 12 recommendations | email to a friend | print
Christ Hospital President and CEO Peter Kelly (left) and Jeanne Otersen, spokeswoman for HPAE, spoke out on an expedited review of the hospital sale.
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Over the objections of Christ Hospital’s CEO, the Jersey City Council unanimously passed a resolution Wednesday opposing an expedited review of the facility’s sale to a for-profit buyer because council members fear the new owner will cut medical services to the poor and overburden the city’s only other remaining hospital.

In addition, the council promised a nurses’ union and the CEO of Jersey City Medical Center that it would closely monitor the Christ sale and try to prevent yet another Hudson County hospital switching to a for-profit owner.

In the last few years, two other nonprofit hospitals in the county have been sold to for-profits, and a third – Hoboken University Medical Center – is in the final stretches of being sold to a private company.

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Prime makes only a five-year commitment to remaining an acute care facility.

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As required by law, the state is currently reviewing a bid by California-based Prime Healthcare Services to purchase Christ Hospital for $15.7 million. According to Christ President and CEO Peter Kelly, the sale is needed to keep the struggling hospital – which loses about $800,000 each month – open.

Because of the hospital’s dire financial circumstances, Christ executives and Prime Healthcare have asked the state to expedite the review process. As the Reporter revealed two weeks ago, Prime Healthcare has asked the state to approve the sale by Dec. 31. Meanwhile, hospital sales in Secaucus and Hoboken, where facilities also switched from nonprofit to for-profit ownership, took nearly 12 months to be approved by the state.

But the City Council gave a ceremonial vote against the expedited review. While the vote doesn’t change what the state may do, it sends a message.

Several City Council members said the sale review process must be “transparent” and questions about Prime Healthcare must be answered before this sale can be approved.

Ward F Councilwoman Viola Richardson said Wednesday, “Greenville Hospital closed on us. We’ve been through this before and I’m not anxious to see it happen again where…services aren’t rendered to our community.”

Over time, many privately-owned hospitals tend to increase profitable medical services (neurology, trauma, ER), while curtailing unprofitable ones (psychiatric care, OB-GYN, pediatrics).

Joseph Scott, president and CEO of Jersey City Medical Center, and representatives from the Health Professionals and Allied Employees (HPAE) union, which represents 400 Christ nurses and other workers, said they shared the council members’ concerns.

If the sale is approved, Jersey City Medical Center would become the city’s only remaining non-profit hospital, and one of only two remaining non-profit hospitals in Hudson County. Palisades Medical Center in North Bergen would be the county’s other nonprofit hospital.

The fear is that any medical need not met by Christ will, in the future, have to be absorbed by Jersey City Medical Center.

Also, at least one hospital that went for-profit, Bayonne Medical Center, canceled contracts with several insurance companies in order to negotiate for a better rate, which forced many consumers to go elsewhere for service.

Kelly to council: We need this

Speaking to the council Wednesday, Kelly painted a picture of a hospital that is on life support.

“Like other hospitals in Hudson County, and throughout New Jersey, Christ has been struggling with the needs of the community and financial pressures,” he said. “Government is restricting our ability to be reimbursed. At the same time, the level of uninsured is growing. The need for health care is growing.”

According to a September letter submitted to the state Attorney General from Christ’s lawyers, the “hospital’s total liabilities exceed approximately $123 million. In contrast, the hospital has recorded its assets as of June 30, 2011 at approximately $38.7 million…The proposed [sale] will inject new capital, keep Christ Hospital open as an acute care general hospital, and maintain programs and services vital to the community.”

Kelly said executives at Christ have tried for the past five years to form partnerships and alliances with other nonprofit hospitals to consolidate services and save money. It was only after these efforts fell apart due to a lack of financing that Christ explored the possibility of a sale to Prime Healthcare.

Prime has agreed to make $35 million in capital improvements at Christ once the sale is completed.

He noted that he is beginning to plan the hospital’s 2012 budget. Without an expedited sale, Kelly said he can’t rule out the possibility of staff layoffs next year.

Scott, nurses: Not so fast

But Prime has been investigated for its medical and business practices in California, where the company owns 14 for-profit hospitals, and the state has taken steps to curb Prime’s ability to buy other facilities there in the future. California’s Attorney General also sued Prime Healthcare for closing a psychiatric center it had promised to keep open.

“I appreciate [Christ’s] necessity for an infusion of cash,” Councilman Steven Fulop told Kelly. “The concern is that, with Bayonne turning into a for-profit, Hoboken turning into a for-profit, if Christ becomes a for-profit it will add stress to Jersey City Medical Center with regards to indigent care. It may not happen tomorrow, but the impact to health care in Hudson County [will be] fairly significant.”

Kelly countered, saying that if the sale to Prime is approved the level of medical care to the community will be unchanged, even though Prime is a for-profit company.

He said that under Prime, Christ would remain an acute care hospital for at least seven years. But in documents submitted to the state, Prime makes only a five-year commitment to remaining an acute care facility.

Scott and representatives from HPAE challenged several of Kelly’s assertions.

“We’ll be [almost] the only nonprofit hospital left in Hudson County,” Scott said. “This is a recipe for disaster. Health care is going to blow up in Hudson County.”

HPAE spokeswoman Jeanne Otersen agreed, adding, “An acute care hospital can mean a lot of things. It can mean an emergency room with a few other services. It doesn’t necessarily mean every service that our community counts on at Christ Hospital.”

Before the sale of the hospital can be finalized it must be reviewed and approved by the state Attorney General, the Department of Health and Senior Services, and the State Health Planning Board. By law there must also be public hearings on the proposed sale so that members of the community can voice their opinions as well.

E-mail E. Assata Wright at awright@hudsonreporter.com.

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