In no uncertain terms, Bayonne residents have made one thing perfectly clear – don’t mess with their hospital.
On Nov. 21 the Bayonne City Council approved the creation of the Bayonne Municipal Hospital Authority, giving the city government official power to purchase its local hospital’s license if a suitable partner is not found.
These actions come in the wake of RWJBarnabas Health signing a letter of intent in October to buy two other Hudson County hospitals – Christ Hospital in Jersey City and Hoboken University Medical Center from CarePoint Health.
But the Bayonne facility was not included in that deal. Instead, CarePoint Health announced that it had initiated a separate process seeking a strategic partner for Bayonne Medical Center.
In addition, according to people familiar with the situation, the hospital land was recently sold to the owner of a local nursing home chain; however, the land transaction has nothing to do with the sale of the hospital.
None of these developments has calmed the fears of residents or local officials. And the question on the minds of not only concerned Bayonne citizens, but also local politicians and health care advocates around the state is: What will happen to Bayonne Medical Center?
According to some people close to the situation it is unlikely that the hospital will close. But industry observers have been asking why Bayonne wasn’t included in the RWJBarnabas deal along with Christ Hospital and the Hoboken facility.
RWJBarnabas already has a presence in the city. It has operated a Satellite Emergency Department in Bayonne since 2017 that has more than 16,000 visits annually.
One possible explanation is that RWJBarnabas was concerned about hitting a potential regulatory roadblock if it dominated the Hudson County hospital market by owning three acute care facilities in close proximity to one another.
Michael Carrier, a distinguished professor at Rutgers Law School, told NJBIZ that antitrust concerns could have dissuaded RWJBarnabas from acquiring the Bayonne Hospital.
“Antitrust enforcement focuses on consumer choice and if it seemed like consumers wouldn’t have a choice but would need to go to a Barnabas facility, that could be challenged by antitrust enforcers,” Carrier said.
RWJBarnabas’s health system competitors Hackensack Meridian Health and Atlantic Health System own many facilities throughout the state – but they have viable competition in each region where they have a presence.
Hackensack Meridian Health and Atlantic Health are perhaps the most likely suitors for the Bayonne facility.
A spokesperson for HMH said the organization has ongoing conversations with many organizations in the region regarding potential opportunities. “When there is something definitive to say about any of them, we would make an announcement,” the spokesperson said. Hackensack Meridian owns the other acute care facility in Hudson County, Palisades Medical Center in North Bergen.
An Atlantic Health System spokesperson said it is “always looking at opportunities, and while we cannot comment on this particular entity, we will certainly let you know when we have anything to announce.”
A spokesperson for RWJBarnabas Health said it is “committed to working with all relevant regulatory agencies – including those overseeing anti-trust matters – to ensure a smooth and timely review of the proposed plan to transition Christ Hospital and Hoboken University Medical Center to our system.”
“We remain laser-focused in our approach to having these two facilities join RWJBH as expeditiously as possible to support their continued viability as trusted, acute care facilities serving Hudson County families,” the spokesperson said. “Additionally, we have a longstanding history of providing outstanding care to the residents of Bayonne through our Satellite Emergency Department and numerous outpatient facilities; this commitment to Bayonne will only be enhanced in the years to come.”
Hospital mergers and acquisitions have been on the rise in New Jersey.
BY THE NUMBERS:
Bayonne Medical Center
HOSPITAL BEDS: 261 licensed beds (includes Transitional Care Unit)
ER VISITS PER YEAR: 26,893
STAFF: 878 employees (non-physician)
2017: 6,388 – includes TCU
2018: 8,387 – includes TCU
2019 YTD: 4,374 includes TCU
IN-PATIENT MEDICARE: 63%
IN-PATIENT MEDICAID: 18%
OUT-PATIENT MEDICARE: 37%
OUT-PATIENT MEDICAID: 26%
RWJBarnabas’s interest in CarePoint’s Hudson County acute care facilities comes as no surprise.
In October, Trinitas Regional Medical Center and RWJBarnabas Health signed a letter of intent under which Trinitas and its affiliates will become a part of RWJBarnabas Health.
RWJBarnabas’s chief rival, Hackensack Meridian Health, has been involved in several high-profile acquisitions. In October, the boards of trustees of Englewood Health and Hackensack signed a definitive agreement to merge. And in September HMH announced the formation of a clinical and strategic partnership with St. Joseph’s Health.
According to an updated study by the American Hospital Association, hospital alliances – particularly acquisitions – reduce costs and enhance quality.
As the health care landscape evolves with the emergence of players focused on advances in information technology and consumer-directed management of chronic disease, traditional independent hospitals can benefit from alignment with larger systems to best serve the health needs of their communities.
Hospital acquisitions are also associated with a statistically significant 2.3 percent reduction in annual operating expenses at acquired hospitals and a new empirical analysis from the AHA shows statistically significant reductions in rates of readmission and mortality.
Data from the AHA revealed that revenues per admission at acquired hospitals also decline relative to non-merging hospitals by a statistically significant 3.5 percent. These results suggest that savings accruing to merging hospitals are passed on to patients and their health plans.
But the residents and public officials of Bayonne are only concerned about one thing: keeping their hospital open. Bayonne Mayor Jimmy Davis vowed that the city will do everything within its power to ensure Bayonne residents will have direct access to an acute care facility.
Assemblyman Nicholas Chiaravalloti, D-31st District, told NJBIZ that the city of Bayonne and its residents, in order to protect public health, absolutely needs an acute care hospital operating within city limits.
“The reason for that is that Bayonne is a peninsula with limited access to acute care facilities and when you pile on top of that the traffic conditions in Hudson County, and the fact that Bayonne is a growing community very close to 70,000 people at the next census and we have over a half a million visitors coming to the Royal Caribbean Cruise terminal every year – the idea that we would be without a hospital poses a significant public health risk,” Chiaravalloti said.