HOBOKEN – It’s official – HUMC Holdco will be the new owners of Hoboken University Medical Center.
Mary O’Dowd, the commissioner of health and senior services, approved the sale of the state’s oldest hospital to Holdco, a for-profit group from Bayonne Medical Center, by issuing a Certificate of Need, according to a letter from O’Dowd dated Oct. 21.
“My decision to allow this transfer of ownership from the Hoboken Municipal Hospital Authority (HMHA) to Holdco is based on the fact that the operation of HUMC under the proposed new ownership would be beneficial to the population in its service area since it will preserve access to health care services for the community, including the medically indigent and medically underserved population,” O’Dowd wrote in her letter to Holdco. “I believe that this approval of a transfer of an existing license will not have an adverse impact on the other existing hospitals in Hudson County or the surrounding counties.”
The city, in 2007, guaranteed $52 million in bonds to save the hospital from closure after the facility faced dire financial problems. The HMHA reviewed eight bids, of which six were deemed by the HMHA to be qualified, in late 2010, and voted unanimously in January to work with Holdco for the sale of the hospital. The sale of HUMC to a private owner relieves the city of the $52 million bond guarantee – a major goal of the administration of Mayor Dawn Zimmer. Zimmer is a member of the HMHA.
“Today’s development is great news for the city of Hoboken,” said Toni Tomarazzo, the chairwoman of the HMHA, in a press release. “There are so many who worked tirelessly to make this transaction a reality. I want to thank my colleagues on the authority, HUMC Holdco LLC and Mayor Dawn Zimmer. Without the mayors single-minded approach to solving our hospital dilemma, we wouldn’t have reached this point in the process. She knew that privatizing HUMC was the only way to preserve it for our residents.
Philip Schaengold, the chief transition officer from HUMC Holdco, also released a statement after the announcement.
“This decision is in the best interests of the citizens and city of Hoboken, the hospitals employees, local physicians, and the state of New Jersey,” Schaengold said. “We look forward to moving ahead with the sale process to keep the doors open at New Jerseys oldest hospital. HUMC Holdco is dedicated to improving HUMC and providing high quality patient care.
O’Dowd set terms to the transfer of ownership in her letter. Some requirements include holding the buyers to the terms set in the sale
contract – such as hiring at least 75 percent of the current employees and keeping the hospital operating as an acute care facility for at least seven years.
The owners have already hired at least 75 percent of the current employees.
O’Dowd also mandates that a community advisory group be established “to provide ongoing community input to the hospital’s CEO and the hospital’s board on ways that HUMC can meet the needs of the residents in the service area,” according to the letter.
“Todays approval has brought us even closer to the end of a long journey, Zimmer said in a release. Within the next few days, we anticipate finalizing the sale of HUMC. It won’t be long after the transaction is completed that citizens of Hoboken will begin to see its benefits.”
The transfer of ownership is scheduled for Oct. 26. – Ray Smith
State issues Certificate of Need, finalizing HUMC deal
