Hudson officials claim Alaris owner is holding up CarePoint hospital sales by asking for $300M

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Top Hudson County leaders came out in unison to “call attention to the critical need to save” three CarePoint facilities, urging the owner of Alaris Health to negotiate in good faith, rather than seeking $300 million for the hospital land he owns, officials alleged today.

By Corey McDonald and John Heinis

“My understanding is that Alaris is asking close to present value on a lease of about $300 million for a property that they’ve acquired for $51 million and that’s a total impasse,” Jersey City Mayor Steven Fulop said at the presser when responding to a question from HCV.

“At this point, Alaris is the obstacle, clearly all about real estate,” Fulop said as Bayonne Mayor Jimmy Davis added, “it’s all about greed and dollars and we’re collectively saying that’s unacceptable to us.”

A call to the office line at Alaris Health was not returned as of Monday afternoon.

The press conference, held outside of the Alaris Health facility on Fowler and Stevens Avenues in Jersey City, was a show of force from the county’s state and local lawmakers, and comes as the fate of of the three hospitals remains uncertain.

Multiple elected leaders cried foul against the situation, but the strongest words came from Davis.

“The future of our hospitals should not be held hostage by a real estate transaction. It’s clear that this model only profits the seller, with absolutely no regards to health care access for our citizens,” he said, adding that the current “economic crisis within our hospitals” is a direct result of “the ownership siphoning hundreds of millions of dollars out from these hospitals.”

One year ago, the New Jersey Commission of Investigation released a report that revealed that CarePoint’s three hospitals paid management companies created by their owners $157 million from 2013 to 2016.

That news prompted Assembly members Nick Chiaravalloti and Angela McKnight (both D-31) to pass legislation to ensure further financial hospital transparency.

Hudson legislators later sent a letter to Gov. Phil Murphy (D) calling for a criminal investigation into the CarePoint owners.

The facilities — Christ Hospital in Jersey City, Hoboken University Medical Center, and Bayonne Medical Center — each serve a vital role in the county and in their respective communities. The three facilities employee some 4,000 people, while the number of patient visits to the hospitals exceed 100,000 annually, healthcare union reps said today.

The county’s healthcare layout was left in uncertainty in October, when CarePoint Health and RWJBarnabas Health announced that CarePoint would sell Christ Hospital and Hoboken University Medical Center to RWJBarnabas — which would have brought them into a network that includes the Jersey City Medical Center.

The parties had been negotiating for several months, but those stalled in February when CarePoint and RWJBarnabas were reportedly tens of millions of dollars apart in a potential deal, prompting Jersey City Mayor Steve Fulop to try and broker a deal.

Financial woes for CarePoint contributed to further negotiations: both Christ Hospital and Bayonne Medical Center are in danger of bankruptcy; the state Department of Health last month dispatched a financial monitor to Christ Hospital.

That move came after New Jersey Health Commissioner Judith M. Persichilli found the facility was in “financial distress and at risk of further financial deterioration.” The company laid off nearly 50 employees at its corporate office in Jersey City last week.

Complicating matters was news in November that Avery Eisenreich, owner of Alaris Health, purchased the properties that house the Bayonne Medical Center and Hoboken University Medical Center.

CarePoint later sued Alaris, suggesting they were interfering with the process to sell their hospitals.

Each facility has different financial arrangements: Alaris owns 100 percent of the property in Bayonne; 70 percent of the property, along with 25 percent of the business in Hoboken; and a 25 percent stake in the Christ Hospital business and property.

Officials today signaled that the both CarePoint and RWJBarnabas, after months of back and forth negotiations, have agreed on a tentative deal, but are now encumbered by Eisenreich and in a hold out, Fulop said today.

“It seems at this point that CarePoint and RWJBarnabas, which — clearly there’s no love between the two — they have both acknowledged that [Eisenreich] is the holdup at this point,” he said.

“We’re not trying to pick sides in this situation. We’re just trying to push [Eisenreich] to come to a reasonable conclusion. And both sides say what he’s asking for is totally unreasonable. That’s where we are.”

Local leaders are now scrambling to protect themselves in case negotiations continue to break down.

“This is an issue where we are united as a county,” Hoboken Mayor Ravi Bhalla added, noting that zoning laws are being enforced in the Mile Square City to ensure the Hoboken University Medical Center land remains used for a hospital (Bayonne and Jersey City have undertaken similar measures).

“We are taking every measure within our legal powers to ensure Hoboken University Medical Center remains at the level — if not better — as a vital acute care facility,” he said, calling it “literally the heart of Hoboken.”

Fulop has previously said there is “zero chance” the Christ hospital property would be zoned differently if the hospital closes.

State Senators Sandra Cunningham (D-31), Brian Stack (D-33), and Nick Sacco (D-32) intend to introduce legislation that would streamline the process on hospital condemnations to ensure they be kept as healthcare facilities.

“When we see the populations that Bayonne, Hoboken and Jersey City serve … it’s sad that one person can hold this up,” Stack said. “We need to stop this from happening, not only in Hudson but throughout the state.”

A statement from CarePoint Health indicated they were supportive of the legislation and remain hopeful that the hospital land in Hoboken and Bayonne will be able to be purchased soon.

“CarePoint Health is greatly appreciative of the show of support for the eminent domain bill that was announced today. It assures that hospital real estate owners cannot block hospitals from continuing their community purpose, and gives cities the ability to make that determination to assure the public interest is served,” they said.

“We are hopeful that passing this bill paves the way for the Hoboken Hospital Property and Bayonne Hospital Property to be purchased from Avery Eisenreich by the cities. This will allow RWJBH to finalize the Hoboken University Medical Center and Christ Hospital transactions. This bill also allows the continuation of Bayonne Medical Center.”

The statement also indicated that CarePoint and RWJBarnabas had agreed on “material terms satisfactory to both parties” pertaining to Christ Hospital, the HUMC, and the Christ Hospital property.

RWJBarnabas did not immediately return an email seeking comment.

Hoboken, Bayonne and Jersey City “are in a great point of growth,” Hudson County Executive Tom DeGise said, and without those healthcare facilities “that kind of growth cannot be sustained,” calling the current impasse “totally unacceptable.”

“We’re going to fight tooth and nail” for these hospitals, he stated.

Other dignitaries in attendance included Jersey City Councilwomen Mira Prinza-Arey and Denise Ridley, Ward C Councilman Rich Boggiano, as well as Assembly members Annette Chaparro and Raj Mukherji.

The presser streamed live on our Facebook page and can be viewed below:

Follow Corey McDonald on Twitter @cwmcdonald_