Saint Michael's Medical Center releases report supporting Prime acquisition

Consolidating and closing healthcare facilities in Newark, N.J., would create a monopoly in inpatient hospital services in the area, potentially causing price increases amounting to as much as $180 million annually, according to a recent report released by Newark-based Saint Michael’s Medical Center.

The report, authored by David Ettinger, an antitrust lawyer who has worked in the healthcare field for more than 35 years, was issued in response to a previous report by Navigant Consulting.

In its report, Navigant Consulting recommended transforming Newark (N.J.) Beth Israel Medical Center, East Orange (N.J.) General Hospital and Saint Michael's into ambulatory care centers. The report also recommended expanding Newark-based Broadway House's role to include post-acute care and expansion of the University Hospital campus in Newark to accommodate Newark Beth Israel Medical Center's inpatient services. Broadway House is New Jersey’s only specialized facility for people living with HIV/AIDS.

But Saint Michael's contends that the recommendations would allow its competitor, West Orange, N.J.-based Barnabas Health, to monopolize the region. Saint Michael's also claims the recommendations would force Saint Michael's to close and would require New Jersey to assume responsibility for an additional $50 million in bond indebtedness.

"We believe that the Navigant recommendations are bad for Newark, bad for New Jersey and especially bad for healthcare consumers," Saint Michael's President and CEO David A. Ricci said in a statement. "Monopolies harm the public and the Navigant recommendations, if enacted, would create a monopoly."

According to a news release, Saint Michael’s is asking the state to promptly approve the proposed acquisition of Saint Michael's by Ontario, Calif.-based Prime Healthcare Services. Prime Healthcare plans to invest more than $25 million into Saint Michael's facility.

 

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