N.J. hospital under scrutiny for its finances is getting a weekly check-up by the state to ensure it meets ?the needs of the community.?

Posted Apr 11, 2019

By Susan K. Livio | NJ Advance Media for NJ.com

The state Health Department meets every week with Bayonne Medical Center officials ?to get updates on their financial health and their ability to meet the needs of the community,? Health Commissioner Shereef Elnahal said Thursday.

The regular meetings began after the State Commission of Investigation released a report March 20 revealing the owners of Bayonne?s for-profit parent company, CarePoint Health, had extracted $157 million in management fees from 2013 through 2016, hospital and health department officials confirmed.

The report found the owners were paid through limited liability companies that do not appear to employ anyone, causing the commission to question whether any services were rendered to merit the payments.

The commission urged the state Health Department to monitor the CarePoint?s holdings ? Bayonne Medical Center, Christ Hospital in Jersey City, and Hoboken University Medical Center ? more carefully.

During the Health Department?s annual hearing before the Senate Budget and Appropriations Committee Thursday, the health commissioner assured Sen. Sandra Cunningham, D-Hudson, "We are monitoring the situation very closely.?

Cunningham asked Elnahal whether he knew ?what is going on with patients," whether any of CarePoint?s hospitals were up for sale, and whether there had been any layoffs.

?We are meeting with Bayonne weekly at this point to get updates on their financial health and their ability to meet the needs of the community," Elnahal replied. ?We are close in touch.?

Elnahal did not elaborate at the hearing, and neither did his spokeswoman afterwards.

CarePoint spokeswoman Jennifer Morrill said the meetings "were initiated as much by CarePoint as the Department of Health, in an effort to assist with fostering even greater transparency.?

Morrill also said here have not been any recent layoffs or changes in the level of services offered at Bayonne,a 278-bed hospital. None of the hospitals is up for sale, she said.

Following the release of the SCI report, CarePoint noted how it had saved thousands of jobs by buying the hospitals out of bankruptcy. The company has paid over $22 million in local property taxes, contributed more than $2 million to local non-profits and community organizations and spent $37 million in infrastructure improvements at the hospitals, the company said.

The health department?s scrutiny was welcomed by Health Professionals and Allied Employees, the union representing CarePoint workers.

?Over the last couple of weeks CarePoint has been in the process of making physical repairs and upgrades, which address concerns raised by HPAE members,? HPAE Public Policy Director Bridget Devane said.

?The union is pleased to hear the Commissioner is responding to the investigative report, and we urge lawmakers revisit the hospital financial transparency law that was conditionally vetoed by Governor Christie,? Devane added. ?If the law had been signed for profit hospitals would have been required to be more transparent to the patients and communities they serve.?

Christie partly vetoed a bill in 2012 that would have required for-profit hospitals to disclose what is now confidential financial information.

?Any change where the state interjects itself into private business raises important issues that should be responsibly and cautiously evaluated,? Christie?s veto statement said.

Last month, however, North Jersey lawmakers said they would consider introducing legislation to tighten the state?s oversight over hospitals? finances.

Jersey Journal Staff Writer Michaelangelo Conte contributed to this report.

https://www.nj.com/hudson/2019/04/nj-h ... eds-of-the-community.html

Hudson County lawmakers want to look into $157M CarePoint payments

Updated Mar 27, 2019; Posted Mar 27, 2019\

By Michaelangelo Conte | The Jersey Journal

Hudson County lawmakers say they will examine how the owners of CarePoint Health extracted $157 million from their hospitals over a four-year period and will consider legislation to tighten oversight by the state Department of Health.

Last week, the state Commission of Investigation released a report highlighting how three men, who through layers of limited liability companies own Bayonne Medical Center, Christ Hospital in Jersey City, and Hoboken University Medical Center, collected millions of dollars in ?management? fees between 2013 and 2016.

But the SCI report noted the owners? management companies do not appear to employ anyone, and that CarePoint pays another company with hundreds of employees to actually manage the hospitals. The SCI report questions whether any services were rendered to merit the money.

On Tuesday, state Commissioner of Health Dr. Shereef M. Elnahal said payments for no services rendered is not normal operating procedure for hospitals.

?Any management organization has to deliver commensurate service to charge a fee,? Elnahal said. ?If they haven?t, that?s an issue. We have to look at appropriate policy means that would allow for enforcement under those circumstances and the administration is happy to work with the legislature to do that.?

State Assemblyman, Nicholas Chiaravalloti, who represents Bayonne and part of Jersey City, said ?This should not occur."

?After reading the SCI report, it is clear that although these actions are legal, they are also an egregious breach of public trust,? Chiaravalloti said, regarding the fees paid to the owners of the for-profit hospitals.

?The SCI recommendations are a good start, but I am not sure they go far enough. The DOH needs to provide better oversight and the legislature needs to hold all operators in healthcare to a higher standard.?


State Assembly members Raj Mukherji and Annette Chaparro, who represent the 33rd District, and state Sen. Sandra B. Cunningham said they are gathering information on the matters raised in the SCI report and are weighing whether legislation is warranted.

?We are very concerned about this,? said Cunningham, who represents the 31st District, adding that her main priority is that the hospitals continue to provide healthcare services.

The SCI report also notes that the owners ? Vivek Garipalli, James Lawler and Jeffrey Mandler ? rescued the hospitals which may have been shuttered.

In a statement, CarePoint spokeswoman Jennifer Morrill said the SCI report noted that the hospitals continue to provide healthcare services to the community after being ?rescued? by the current owners. She said the report confirms the hospitals acted in good faith regarding state rules and regulations on transparency.

Morrill said CarePoint saved thousands of jobs, it has paid over $22 million in local property taxes, has contributed more than $2 million to local non-profits and community organizations and spent $37 million in infrastructure improvements at the hospitals.

?CarePoint?s singular commitment has been to deliver outstanding, patient-centered care for Hudson County which we have been successful at for over a decade,? Morrill, adding that CarePoint support the SCI?s recommendation for greater transparency in financial reporting to the DOH.


CarePoint has not answered questions about the $157 million. In sworn testimony, Mandler called the fees payment for the three men?s ?sweat equity?? while Garipalli called them ?incentive payments?? to be made only if the hospitals were successful.

?Although these three individuals have provided services to the three CarePoint Health hospitals, the extent of the services leading to more than $157 million in management fees and allocations for a four-year period is unclear,? the report states.

The New Jersey Hospital Association President Cathy Bennett noted that hospitals are a critical part the state?s social fabric and economy, serving 15 million people annually, providing 150,000 jobs, $565 million in charity care services, $2.9 billion in community programming and $23.6 billion in economic benefits..

?As such, they are subject to numerous transparency requirements,? Bennett said. ?Hospitals are entrusted with delivering quality, accessible and high-value care to all the residents of our state, and with that responsibility comes oversight and accountability.?

The DOH responded to the SCI report?s recommendation for its increased financial oversight of and the payouts to the hospital owners saying it cannot conduct proper financial oversight of hospitals unless hospital financial reporting is done accurately and in a manner that reflects ?true costs and services.?


Regarding the layers of LLCs through which the CarePoint hospitals are owned, the DOH said it is working on an electronic licensing system to keep track of hospital management structure, as well as additional hospital transparency regulations.

https://www.nj.com/hudson/2019/03/heal ... m-carepoint-payments.html