For-profit hospitals discussed in Trenton, Hearing draws testimony from Meadowlands CEO; Hoboken head absent

September 27, 2011 - Hoboken Reporter

Hudson County hospitals were front and center at a state Health, Human Services and Senior Citizens Senate subcommittee meeting on Monday that focused on for-profit hospitals in New Jersey.

The hearing came just days after allegations of bankruptcy fraud were made against Hoboken University Medical Center (HUMC), and on the same day it was reported in The Star Ledger that Meadowlands Hospital in Secaucus charges up to 3,000 percent higher for certain procedures by using a loophole in the medical system.

In Hudson County and across the country, failing hospitals are being bought by companies that try to turn a profit at these formerly non-profit institutions. But some worry that patient care will suffer as a result.

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State Sen. Weinberg said she is concerned about the trend toward for-profit hospitals.

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The committee’s hearing, chaired by State Sen. Loretta Weinberg (D - Bergen), heard testimony from Meadowlands CEO Tom Gregorio, Renee Steinhagen of public interest law center New Jersey Appleseed, and insurance and union professionals.

Vincent Riccitelli, the CEO of Hoboken University Medical Center, was invited to attend the hearing but was not present. Last week, the city of Hoboken was trying to salvage a controversial deal to sell the hospital to private owners (see updates at hudsonreporter.com).

“I guess we’ll just continue reading what we’re reading in the papers and legal kits,” Weinberg said after she learned no representatives from HUMC were in attendance.

Weinberg said at the end of the hearing that she would talk to Sen. President Steven Sweeney about the possibility of subpoenaing those who didn’t attend.

However, she added that she did not wish to interfere, since she has already asked the U.S. Attorney’s office to investigate allegations of bankruptcy fraud stemming from the Hoboken deal.

The committee called for tighter restrictions on hospital transfers. Hospital sales must be approved by several state entities and comply with the Community Health Asset Protection Act (CHAPA).

Steinhagen said she believes there should be a CHAPA review of the Hoboken hospital sale. The hospital’s legal position is that it doesn’t need a CHAPA review because it is municipally owned.

State Sen. Joseph Vitale (D – Middlesex), who helped author the original CHAPA legislation, said the intent of the law isn’t to exclude municipally-owned facilities. Vitale said he is working on changes to the legislation, and said after the hearing that he believes the HUMC sale should be subject to CHAPA. Steinhagen said she is in favor of “broadening the act.”

Meadowlands hospital discussed

Weinberg told Gregorio that she believes the hospital owners’ characterization of the Meadowlands hospital workers’ union as “malignant and cancerous” in a Secaucus Reporter article was “a little inappropriate, to be kind.”

That quote came about after the union complained to the state earlier this year about conditions at the hospital after it was bought by a for-profit company. The hospital’s new owners said that the union was only complaining because they were being asked to work harder.

It only came out this past week that the hospital was also under scrutiny for charging high fees for outpatient surgery.

Gregorio of Meadowlands hospital defended those charges, saying the hospital has only been paid “7 percent on the charges [they] have billed.”

Gregorio also said the hospital has submitted a plan of correction following the allegations made in an earlier state review.

Gregorio added that the hospital “is at the 2-yard line” with United Insurance, nearing a deal to accept patients in-network.

A representative from the nurses’ union from Christ Hospital of Jersey City was also in attendance, as that hospital may be sold to a company from California.

The union representative called for a “strengthening of the certificate of need provisions” and to “consider the track record of all the buyers, whether they’re in state of out of state.”

Weinberg said she is concerned about the trend of for-profit hospitals.

“I’m going to discuss with my senate president and the Senate committee if we should take any other steps here,” Weinberg said. “[Let’s] find out exactly what is going on here.”

Weinberg said she was concerned about the Hoboken deal, because $11 million from the state budget went to the hospital to ease the sale.

“We’re interested in what this business model is going to be and then in making sure the taxpayers of New Jersey are protected with their investment,” Weinberg said.