Transfer of BMC to Hudson Regional Hospital takes major step with recommendation by state DOH
Taken from NJ.com
By Ron Zeitlinger | The Jersey Journal
December 2, 2024
The transfer of Bayonne Medical Center, one-third of the cash-strapped CarePoint Health system, to Hudson Regional Hospital has cleared a major hurdle.
The state Department of Health has given the transfer ― technically it’s a $13 million sale ― its blessing, the last step before final approval. The State Health Planning Board will hold a special meeting on the certificate of need application Dec. 12.
Officials with Hudson Regional Hospital and CarePoint Health could not immediately be reached for comment.
The transfer/sale of the Bayonne hospital is one piece of the merger between the CarePoint Health hospitals ― Christ Hospital in Jersey City and Hoboken University Medical Center, both safety net hospitals ― and Hudson Regional (HRH), in Secaucus. The new healthcare system would be called Hudson Hospital System.
CarePoint Health, more than $108 million in debt, filed for Chapter 11 bankruptcy last month amid the plans for the merger, which was first announced in January, stalled in the spring and then was revived in October.
The department’s recommendation for approval noted “this acquisition by HRH will offer proven management skills, and reliable access to a more financially secure facility in the service area.”
Failure to approve the application “may result in further undue financial hardship for BMC and CarePoint Health system as a whole,” while approval would ensure a “stable” hospital, the recommendation also said.
While strengthening BMC, the transfer would not affect the sharing of services and administrative efficiencies among BMC and the other CarePoint hospitals.
The 19-page recommendation came with a list of 26 conditions, including the creation of new board of trustees within 60 days of licensing and the board must include at least three community members.
NJDOH public hearing on BMC sale to HRH
Also, within 90 days of licensure HRH must create a community advisory group (CAG) “to provide ongoing community input to the hospital’s CEO and the hospital’s governing board on ways that HRH can better meet the needs of the residents in its service area.”
Some of the other conditions, mostly related to transparency and accountability, placed upon Hudson Regional Hospital:
- Notify, in writing, the state Department of Health of any future changes in their respective ownership interests in the hospital;
- Make BMC current with audits and other filings, as well as post annual audited financial statements and quarterly unaudited financial statements on the BMC website.
- Within six months after licensure, provide documentation to the department on any reduction of staff and rationale for any reductions that may have occurred.
- Provide annual report for five years detailing plan for addressing the community needs to expand or add ambulatory care services, any plans to reduce any services and excess inpatient beds,
plans for restructuring whether financial or strategic; and capital improvement plans.
Hudson Regional’s certificate of need said no reduction, elimination or relocation of services are proposed, but after the transfer of ownership, HRH would assess the needs of the community and may add or reduce services.
The application also promised to turn BMC from money pit to a money maker, citing a 13-point plan. Noting its own success story (a $6.8 million operating loss in 2017 under prior ownership was turned into $6.5 million profit in one year), HRH says it can turn BMC’s projected $46.8 million loss in 2023 into $2.9 million in net income in 2024.
Hudson Regional Hospital, which owns the land under Bayonne Medical Center, has lobbied to purchase the hospital for at least four years. It had sued CarePoint for breach of contract regarding the lease of the property.
CarePoint had previously resisted the overtures, instead focusing on the failed attempt to sell just short of 50% of the hospital to the BMC Hospital LLC. BMC Hospital LLC currently owns 9.9% of the hospital.