HOBOKEN AND BEYOND — The State Health Planning Board scheduled a second public hearing for the sale of Hoboken University Medical Center for Thursday morning in Trenton, just a few days after the hospital’s operator, Hudson Healthcare, Inc. (HHI), filed for Chapter 11 bankruptcy on Monday.
Inside the hospital, sources say some employees have been applying for their current jobs. The new owners, who also own Bayonne Medical Center, have said they will bring on at least 75 percent of the current workforce after the transfer of ownership.
The bankruptcy, being handled by the powerful West Orange law firm Trenk, DiPasquale, Webster, Della Fera & Sodono, P.C., will affect between 1,000 and 5,000 creditors, according to the filing in United States Bankruptcy Court.
The acting CEO of HUMC and CEO of HHI Vincent Riccitelli said in a release that the bankruptcy proceedings do not mean the hospital is closing, but instead called it “a constructive step toward completion of the sale of HUMC and the eventual wind-down of HHI.”
Attempts to reach Riccitelli for followup questions were unsuccessful as of Wednesday.
Only the 20 largest creditors are listed on the bankruptcy petition, which was filed on Aug. 1.
UMDNJ of New Brunswick is listed at the top of the petition with a $2.8 million claim. PSE&G’s claim is for $2.5 million. The city of Hoboken and the Hoboken Parking Authority are listed for a combined total of approximately $2 million in claims.
The District 1199J NJ Benefit Fund is listed on the petition as a $1.05 million claim. The 1199 union represents employees that are not nurses. Nurses are represented by JNESO, based in North Brunswick.
Virginia Treacy, the executive director of JNESO, has called for a review of the sale, and was expected to present hundreds of signatures on Thursday that the union collected from the community asking for a review of the sale by the state Attorney General’s office. Usually, hospital sales are reviewed by the Attorney General’s office in the form of a Community Healthcare Asset Protection Act (CHAPA) review. However, since the hospital is municipally owned, there is no requirement for a CHAPA review.
On the line for the city is a $52 million bond. The City Council voted to guarantee a $52 million bond to save the hospital from closure in 2007.
Mayor Dawn Zimmer, who serves on the Hoboken Municipal Hospital Authority, has said a goal of hers since becoming mayor in 2009 is to sell the hospital, which has been losing millions annually. The sale would also relieve the city’s duty to back the bond.
The pending sale would be to a for-profit entity that also owns Bayonne Medical Center. BMC is a major supporter of Reform Jersey Now, a political action committee that supports Gov. Christopher Christie’s initiatives.
The potential owners have said they would plug $20.9 million into the hospital for capital improvements. The Asset Purchase Agreement leaves the decision to invest the $20 million in the hospital up to the potential new owners, and is not contractually required.
Zimmer has said if the sale to HUMC Holdco (the Bayonne group) doesn’t go through, then the hospital would close. Zimmer’s claim has been disputed by unions and other bidders.
For coverage of the hearing and the bankruptcy, keep reading HudsonReporter.com and pick up a copy of The Hoboken Reporter this weekend. – Ray Smith