Daily Record

Hearing On Plan To Sell St. Clare's Draws Big Crowd

Daily Record — Thursday, July 24, 2014

By Lorraine Ash

DENVILLE — A standing-room-only crowd of 150 people gathered at the municipal building here Wednesday night to urge the state health planning board to approve Prime Healthcare's purchase of the St. Clare's Healthcare System — with caveats and conditions.

Universally, those gathered, including elected officials, doctors, nurses, and patients, wanted to ensure that Prime, a for-profit company, will continue St. Clare's long tradition of charity care.

Many also urged the board to act quickly.

"I thank you for the in-depth review," St. Clare's CEO Les Hirsch told the health planning board. "We realize this takes time, but it's difficult for an organization to be in limbo."

A representative from New Jersey Citizen Action, the state's largest citizen watchdog coalition, pointed to past actions of Prime and urged the board to appoint a monitor to oversee how it handles the needs of both the hospital and the community.

The public hearing was the second of two on St. Clare's so-called certificate of need applications. The first took place Tuesday night at the Hilton Garden Inn in Rockaway and drew just as many people.

Two applications, and two public hearings, are required because the healthcare system, which has grown into four campuses since the Sisters of the Sorrowful Mother opened the first hospital some 120 years ago, has two licenses.

One license is for Dover, Hirsch explained, and the other for St. Clare's Boonton, Denville, and Sussex campuses. The state health planning board will present its recommendation to the state health commissioner Aug. 7.

Since 2010, St. Clare's has experienced financial challenges, Edward McManus, an infectious disease physician and chairman of its board of trustees, told the health planning board.

"Those challenges have been compounded by major rapid and permanent changes in the health care landscape," McManus said, explaining the board of trustees entertained proposals from several health care organizations in New Jersey, to no avail, and determined last year that Prime offered the best option.

"St. Clare's has a proud tradition of providing care to the most vulnerable people in our community," he added, "and Prime has committed to follow through on St. Clare's charity care policies and hire substantially all of St. Clare's employees."

The board of trustees and hospital leadership, according to McManus, also liked Prime's track record of quality care and financial strength as well as its plans to develop a regional network of health care providers in New Jersey and nearby states.

On numerous occasions, it was mentioned that Truven Health Analytics put Prime Healthcare on its 2013 list of the Top 15 Health Systems in the nation and placed several Prime hospitals on its 2012 and 2013 lists of Top 100 Hospitals.

The California-based company owns 26 hospitals in six states — California, Kansas, Nevada, Pennsylvania, Rhode Island, and Texas, according to its website. It has been purchasing hospitals in financial distress.

Yesterday, Prime received final approval from Superior Court Judge Margaret Mary McVeigh to acquire St. Mary's Hospital in Passaic, according to Radha Savitala, Prime's deputy general counsel. She added Prime also has applied to acquire St. Michael's Medical Center in Newark.

"We're continuing to look at other properties in New Jersey," she told the Daily Record, "though we have no other applications pending at this time."

Dover Mayor James Dodd was one of eight public officials, including Assemblyman Anthony Bucco (R-Dist. 25), who spoke in favor of the acquisition.

"St. Clare's first hospital on Ann Street served our town during the Victorian Era," said Dodd, adding he had met with Prime representatives and told them of the dual needs for treatment and educational programs in area communities.

"Prime needs to adopt our community," he added. "I have faith Prime will do that."

Denville Mayor Tom Andes noted St. Clare's Hospital opened its doors in the township in 1953 and today is Denville's largest individual employer. He, too, was encouraged by Prime's willingness to take on St. Clare's mission to provide charity care.

Dozens of people, including St. Clare's staffers and volunteers, made formal statements expressing love for the hospital and sharing stories of compassionate care spanning decades. Speaker after speaker emphasized that St. Clare's must not close and is needed to serve the central part of the county.

"The alternatives to St. Clare's are miles away," said Kenneth Brown of Denville, a retired banker and Vietnam veteran who volunteers at the hospital. He cited Newton, Morristown, and Chilton medical centers.

Still, India Hayes Larrier, representing New Jersey Citizen Action and the Campaign to Protect Community Healthcare, urged caution and looked back at Prime's track record with a different view.

In February, Truven Health Analytics rescinded the 2012 and 2013 Top 100 designation from a Prime hospital after it was sanctioned by the California Department of Public Health for improper cardiac care, according to a report in California Healthline.

The same publication reported that, in May, two California lawmakers approached Truven asking that Prime be removed from the 2013 list of Top 15 Health Systems. They also asked that two other Prime hospitals be removed from the list of Top 100 Hospitals due to a sanction for administering a fatal overdose of a sedative and suspicious billing practices, respectively.

Here in New Jersey, Larrier noted that staffers were laid off at St. Mary's Hospital in Passaic and that the hospital sent termination notices to two insurance companies a week after the health board gave its stamp of approval to that acquisition.

Media reports show Prime had nothing to do with the 30 layoffs at St. Mary's, which employs 1,400 people, and confirm that UnitedHealthcare and Cigna did get termination notices, allowing the hospital, when the contracts end, to bill the companies and patients at rates higher than those charged by Medicare.

"We ask that Prime not be allowed to have yet another hospital in our state unless you appoint a monitor to oversee their handling of the hospital and the community's needs," Larrier said. "We urge you to require them to remain in network with insurances, not just post their status on a website.

"We urge you to require enforceable safe staffing models, because if they are not required to maintain adequate staffing, they cannot maintain adequate care," she added. "We urge you to not allow them to decide whether to increase charity care, but to require that they meet the need levels of the community."

Both Bob Parker, CEO of NewBridge Services, a large behavioral health agency, and Sr. Frances Renn, now chaplain at St. Clare's Behavioral Health Services in Boonton, urged the health board to ensure that much-needed mental health services stay intact after the acquisition.

"Under the leadership of our county mental health administrator and our Morris County Mental Health Board, we have developed a team of agencies," Parker said. "We have a terrific system of care and St. Clare's has been a cornerstone in that development.

"NewBridge Services fully supports Prime Healthcare's acquisition of St. Clare's," he added, "and we, especially, of course, encourage the continuation of their behavioral health services."

For the acquisition to happen, the state health commissioner must approve the certification of need applications. After that, the Attorney's General must approve St. Clare's CHAPA request, a process that ensures the sale complies with the Community Health Assets Protection Act and is in the public interest.

Then, finally, a Superior Court judge must review the work of both the state health department and the Attorney General's Office and give the deal the final stamp of approval.

"A good estimate for timing is the fall," Hirsch said, "hopefully, by the end of the year."

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