Fight between CarePoint and HRH turns ugly as both sides tee off in appeal to NJ DOH

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The fight between CarePoint Health and Hudson Regional Hospital has turned ugly as both sides have recently appealed to the New Jersey Department of Health to pick a side, with each health care provider exposing their opposition’s perceived shortcomings.

By John Heinis/Hudson County View

“We think it prudent for the Department to fully investigate BMC LLC and its track record before accepting it as the operator of the Bayonne Hospital. This is, of course, the reason the Department engages in a full review of Certificate of Need applications,” Angelo Genova, an attorney for Avery Eisenreich, wrote in a June 7th letter to the NJ DOH.

Eisenreich, the owner of the Alaris Health nursing home chain, also has a significant stake in the real estate occupied by the Bayonne Medical Center and the Hoboken University Medical Center.

While it appears that the county is moving forward to execute eminent domain on these properties, HRH announced on June 2nd that they would be purchasing the land for $220 million – which came just minutes after CarePoint said they were selling the BMC to a new provider: BMC Hospital LLC.

In the aforementioned letter, Genova says BMC Hospital would be a “troublesome operator,” due to “an extensive track record of being sued by major commercial insurance payers, with those entities alleging insurance fraud and racketeering.”

He cites two New York Supreme Court cases filed by Allstate Insurance Company against a principal or principals of BMC Hospital, alleging fraudulent no-fault benefit claims – the latter through an “illegal referral scheme.”

Both cases are still pending.

“In conclusion, one thing all parties appear to agree on is that CarePoint is financially depleted and needs to be replaced as the operator of Bayonne Hospital and Hoboken Hospital,” Genova wrote.

“As Mr. Eisenreich transfers real estate ownership to HRH, it will become HRH’s responsibility to seek the regulatory approval of the DOH to operate Bayonne Hospital. At this point, the application of BMC Hospital LLC should be rejected for review.”

Yesterday, BMC Hospital returned fire in their own letter, with their attorney James P. Flynn touting their team of professionals that have make a commitment to continue running the Bayonne hospital before taking aim at HRH’s finances.

“As its 2019 audited financial statement illustrates, HRH has very weak liquidity. They have just three (3) days cash on hand, which means they have virtually no cash reserves should there be delays in reimbursement or unexpected increases in expenses,” Flynn wrote.

“The situation is exacerbated by HRH’s payer mix which leads to very slow collection of reimbursement. The hospital’s days in accounts receivable is 161 (compared to a statewide median of 45), which means the hospital takes 3.5 times longer to collect net patient revenue than the typical New Jersey hospital.”

He also points out that their total admissions and occupancy based on licensed beds were only about a quarter of the state median, with their average daily census only about one-fifth of the New Jersey hospital median.

Flynn also points out that HRH Founder and Chairman Yan Moshe, who used to go by Yan Leviyev, who is being sued for allegedly exposing patients to HIV, hepatitis, and other infectious diseases at the HealthPlus Surgery Center in Saddlebrook – which he owns.

Similar to the cases against principals of BMC Hospital, GEICO filed suit against Moshe and HRH in February seeking $25 million after the hospital allegedly submitted thousands of no-fault insurance claims, as well as that Moshe unlawfully controlled three medical facilities in New York and New Jersey.

According to the Flynn, one of the cases previously mentioned against BMC Hospital has been resolved without any admission of guilty or liability, while the other is awaiting a decision on a motion to dismiss.

” … The Moshe/Leviyev record should raise many more concerns for DOH than anything about cases in which BMC Hospital’s principals have been involved. Indeed, the Allstate matter seems to be an alternative means for Allstate to recover funds from that defendant entity after that entity won 172 Arbitrations against Allstate between 2016 and that case being filed,” Flynn asserts.

He concludes that the facts clearly show that review of BMC Hospital’s certificate of need should continue on an expedited basis.

CarePoint filed suit against HRH earlier this month alleging they were interfering in the sale of the Bayonne Medical Center, though a judge denied emergent relief in the case, which isn’t scheduled to go to trial until February 2021.

Additionally, while Hudson County Executive Tom DeGise, with the support of four mayors, recently called on the NJ DOH to help find “financial solutions” to resolve CarePoint’s woes, it doesn’t sound like that will be happening any time soon.

“The department does not comment on pending litigation,” NJ DOH spokeswoman Donna Leusner said in an email last night.