Secaucus’ only hospital is being sold to a group of investors who say the facility will remain an acute care hospital.
However, the facility’s workers are still concerned about their fate.
The sale of the facility, with 230 beds and 550 employees, must be approved by the New Jersey Department of Health and Senior Services to go forward.
The company that owns Meadowlands Hospital Medical Center, LibertyHealth of Jersey City, announced a week ago that it had accepted an offer to sell the facility to MHA LLC, based in Newark.
“Is this company going to continue to provide the same level of services that the community needs?” – Jeanne Otersen
MHA is a group of investors that recently formed to buy the hospital. They are headed up by William Vazquez, the former director of West Hudson Hospital in Kearny.
LibertyHealth received three other proposals from prospective bidders, “but we felt this group was the strongest bidder because they had the background and experience and financial ability to continue to advance the hospital,” said Mark Rabson, director of corporate affairs for LibertyHealth.
According to one Meadowlands Hospital medical staffer, one of the other bids came from a group of doctors associated with the hospital. But that bid was rejected in favor of MHA.
LibertyHealth would not comment on who the other bidders were.
Bill Maer, a spokesman for MHA, said, “MHA, as a group, has individuals with extensive experience in the health care business, and Bill Vazquez has significant experience running hospitals. I think Liberty saw an opportunity they wanted to take advantage of.”
Hospitals have closed
The impending sale of Meadowlands Hospital raises concerns for staff, patients, and the surrounding Secaucus community. Across the country, small community hospitals like Meadowlands have been struggling to keep their doors open in recent years. Several have filed for bankruptcy, and many have closed altogether.
Hospitals have seen an increase in patients who lack private health insurance. At the same time, state reimbursements for Medicaid and the uninsured – the so called “Charity Care” patients – have remained flat. Other sources of charitable donations to hospitals have dropped.
Meanwhile, medical expenses and labor costs have gone up, investment returns have dropped, competition from independent providers has increased, and hospitals have struggled to stay afloat.
According to the New Jersey Hospital Association, more than 15 hospitals have closed in the state since 1997, including LibertyHealth’s Greenville Hospital in Jersey City, which once served more than 125,000 patients annually. When that hospital began taking on huge losses – $3 million annually – Liberty asked the state’s Health Planning Board for permission to close Greenville.
Despite protests from community activists who argued that Greenville would be left without a local hospital, Liberty shuttered Greenville in 2008.
Although Greenville served a different community than Meadowlands Hospital, its plight and eventual closure are a cautionary tale for the facility in Secaucus.
But Maer said MHA executives are confident Meadowlands Hospital will grow under their ownership.
“It is our intention to keep this an acute care hospital and we’re going to build on the work that Liberty has done with the hospital,” he said. “We feel confident that with increased marketing and bringing in new physicians, we will increase the patients in the facility, and do it in a reasonably short period of time.”
Staff braces for uncertainty
As with any hospital sale, not only must the state license be transferred; so too must the staff. Typically, the staff gets “laid off” by the outgoing hospital owner, and gets rehired by the new owner.
But some staff members and local leaders are concerned about their future.
“We care about a number of things,” said Jeanne Otersen, spokeswoman for Health Professionals and Allied Employees, a union group that represents nurses and technicians at Meadowlands Hospital and other facilities. “Is this company going to continue to provide the same level of services that the community needs? Is the state going to protect the hospital’s assets? Are we going to protect both the jobs and the wages that people have earned, and the contracts that have been negotiated?”
Otersen said the union, which caught wind that a sale of the hospital might be imminent, has requested that LibertyHealth arrange a meeting between them and the new buyer.
On Friday, Jan. 8, the day the sale was announced, executives from Liberty walked throughout the hospital talking to staff members about sale, Rabson said.
Mayor Michael Gonnelli, who has also met with LibertyHealth and MHA officials, shares HPAE’s concerns.
“One of my concerns is we have over 200 people employed at the hospital who live in town,” Gonnelli said. “One of the things I addressed with them is we wouldn’t like to see those people lose their jobs or have a cut in pay.”
Addressing Otersen and Gonnelli’s concerns, Maer said, “Certainly the organization is evaluating operations, and personnel is a part of that. There is communication with the unions and there will be individual communications with the employees. Right now, though, it’s too early in the transaction to give concrete answers about staffing decisions.”
LibertyHealth, which also owns Jersey City Medical Center, said they decided to sell Meadowlands Hospital because executives believed another company would be better equipped to advance the services there.
“Meadowlands Hospital is a great hospital, with a great staff, with great services,” said Rabson. “But it is purely a community hospital and it doesn’t have services that bring in a lot of resources. And it’s surrounded by megahospitals – in Hackensack, in Jersey City – and it’s a very tough market to compete in… Liberty has invested a lot of resources in Meadowlands Hospital and we felt we’ve done a good job of bringing it up to the level where it is now. MHA can now take it to another level.”
Rabson emphasized that Meadowlands is not a failing hospital, like some that have closed around the state.
“We’re selling it because we believe the new owners can infuse more resources into the hospital operation and make it even more successful and continue to serve as an acute care hospital,” Rabson said.
How a hospital gets sold
For the sale to go through, LibertyHealth must now file a Certificate of Need with the New Jersey Department of Health and Senior Services. The Certificate of Need application should be filed by Feb. 1.
The department will take about 90 days to determine whether MHA is fiscally stable enough to purchase and run the hospital. The state will then pull together meetings with MHA officials, Meadowlands staff members, union representatives, and local elected leaders in Secaucus to discuss the sale.
“There will probably also be a public hearing,” according to Assemblywoman Joan Quigley, hospital administrator at Hoboken University Medical Center and a member of the Assembly’s Health and Senior Services Committee. “And at the end of the 90-day period the Dept. of Health will likely approve a transfer of the license from LibertyHealth to the new buyer.”
One detail of the sale that state health officials might scrutinize is the transfer of the hospital from a private nonprofit entity (LibertyHealth) to a for-profit company (MHA), although this detail would not in itself block the sale.
E-mail E. Assata Wright at firstname.lastname@example.org.