CEO of Jersey City Medical Center is willing to buy troubled Hoboken hospital if bankruptcy negotiations collapse

September 23, 2011 - Star Ledger

JERSEY CITY — The CEO of the Jersey City Medical Center has reached out to state and local officials to let them know he is still willing to buy the Hoboken University Medical Center if bankruptcy settlement negotiations falter and the proposed sale collapses.

Joe Scott, CEO of Jersey City Medical Center, said he contacted Hoboken Mayor Dawn Zimmer and the state Department of Health and Senior Services Thursday morning just hours after Hoboken City Council rejected a last-minute effort to salvage negotiations.

Minutes after the vote, Zimmer said the oldest hospital in the state would close and roughly 1,300 people would lose their jobs.

"I let them know we stand ready to do whatever it takes to ensure there is a organized transition with the hospital if this deal falls apart,'' Scott said. "We have a partner willing to buy the hospital and placed a bid…We were going to lease space from them.''

The partner is CHA Properties, he said.

The deal would have moved all of Jersey City Medical Center's women and children services to Hoboken. Acute care and emergency room services would be maintained, he said.

"If the hospital is going to close, at the very least I would like to see . . an orderly transition to our facility and others in the area. Without that transition there will be chaos, and we are dealing with people's lives here.''

Zimmer will hold a press conference at 2:30 p.m. today at the hospital to provide a progress update on negotiations with creditors, offer a revised timeline for completion of the sale with the ownership group of investors who own the Bayonne Medical Center and answer questions.

Gov. Chris Christie Thursday said he would pledge $5 million in state funds to jump start bankruptcy negotiations key to the sale of Hoboken University Medical Center to the ownership group.

Christie’s announcement came less than a day after the talks nearly collapsed and Hoboken City Council shot down a proposal to issue $5 million in bonds to help entice reluctant creditors to settle with the hospital. Minutes after that vote, Hoboken Mayor Dawn Zimmer said hospital would surely close.

Even with the promise of cash, creditors and the hospital have failed to reach any agreement, and they are expected to continue today. Christie said unions are to blame, but labor leaders said the governor is trying to set them up as the scapegoat if the hospital closes.

The creditors are owed $34 million, and the hospital initially offered $5 million to settle, along with protection for the city and the authority from future lawsuits. The state money would double the amount.

Christie said the state needed to intervene because if the hospital closes, 1,300 jobs would be lost and the city would be saddled with unbearable payments on $52 million in bonds that it guaranteed when it bought the hospital in 2007.

Christie, during a news conference, said he did not want the deal to die because of "political paralysis," adding that "if it dies for other reasons, then it dies for other reasons."