Politics & Government

State Health Planning Board Recommends Sale of HUMC

The State Health Planning Board held a public hearing on Thursday morning. The decision is now up to New Jersey's commissioner of health.

TRENTON—The State Health Planning Board voted to recommend the sale of the Hoboken University Medical Center to HUMC Holdco LLC., after meeting for more than four hours on Thursday.

The board cannot approve the sale—that will have to be done by State Health Commissioner Mary O'Dowd.

The board also approved to amend the contract, allowing Holdco to renegotiate—but not necessarily accept—the current contracts between the hospital and health care providers. 

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This may mean that patients who are currently covered at HUMC in Hoboken will have to pay more out of pocket in the future, if their health care plan isn't accepted. It's unclear what will happen to patients with prescheduled procedures, after their plans are no longer accepted.

Phillip Scheangold, the chief transition officer between HUMC (the seller) and HUMC Holdco (the potential buyer), presented HUMC Holdco's proposal to the health planning board. 

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Scheangold promised a good faith effort in negotiations with health care providers, but said that if HUMC Holdco were forced to accept all current plans, the deal would no longer be financially feasible.

Sarah McLallen, Vice President at NJ Association of Health Plans, disagreed.

"They have no interest in contracting with the health plans," McLallen said, adding that negotiations are not yet on their way.

Another concern mentioned was the state of Hoboken's facility. Judy Donlen, the chairwoman, mentioned that the physical hospital building will only be good to use for the coming five years. Holdco is supposed to operate the hospital for at least seven years, according to the contract on the table.

"Our intent is to invest about $20 million in the facility," Scheangold said.

Geoff Teed, president of Paradigm Physician Partners (P3), said that his bid to buy the hospital is still on the table, and that he would keep the hospital as a nonprofit entity.

Hoboken Municipal Hospital Authority Chairwoman Toni Tomarazzo said that P3 did not have the funding necessary to save the hospital.

Joe Scott, the CEO of nearby Jersey City Medical Center, expressed his concerns about a potential flow of patients who would no longer be covered at HUMC.

Mayor Dawn Zimmer, who is a commissioner on the HMHA, told the health planning board that the hospital will close if the sale isn't approved.

Among the goals of saving the hospital, is also retaining the hospital's more than 1,200 employees. The contract stipulates that Holdco keep at least 75 percent of all workers, but Scheangold said that a higher percentage will likely stay at the hospital. All employees were asked to reapply for their position, he said.

Of the 1,270 employees, more than 1,100 reapplied, Scheangold said. Although the deal has not been approved—and thus not yet finalized—Holdco will already start the process of reviewing the applications, Scheangold said.


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