A Jersey City hospital and a private California company have called off a controversial deal that would’ve made the non-profit hospital part of a commercial network.
Christ Hospital, a 140-year-old Episcopal institution, announced its sale to Prime Healthcare Services last summer, and state regulators have been reviewing it ever since.
The two sides said highly vocal opposition from the community scuttled the deal on Wednesday. Hospital CEO Peter Kelly said opponents unfairly maligned Prime Healthcare — and for-profit hospital management, in general — but there did not appear to be a way forward.
"Prime had felt, after discussions with us, that there simply was not a desire on the part of our community, to see Christ converted from a not-for-profit to a for-profit hospital," Kelly said.
But Renee Steinhagen, from New Jersey Appleseed Public Interest Law Center, said the the sale would've been bad for local residents — and that the hospital board didn't look closely enough at Prime Healthcare's track record.
"The board doesn't take their fiduciary duties to the community seriously and let this get to some crisis point and then was selling this hospital to some entity, where they clearly didn't do proper investigation," Steinhagen said.
Not true, Kelly countered. His staff examined Prime Healthcare's record and decided it was a good candidate to run the hospital well. Steinhagen countered that she looked at two years worth of Christ Hospital board minutes and found no evidence of any board discussion on the sale, prior to the announcement of a Letter of Intent in August, 2011.
Kelly told WNYC the hospital has $70 million in liabilities and only “days worth of cash on hand” to pay staff and vendors and to meet obligations.
The hospital received a $104 million purchase offer late last week from non-profit Jersey City Medical Center and Community Healthcare Associates, a New Jersey-based for-profit company.
That offer is still under review by the hospital, whose board was meeting Wednesday afternoon to discuss options.
Below: Christ Hospital's 2009 tax release -- the most recent available online -- shows net assets of -$65.7 million and expenses exceeding revenues by $18.3 million.