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MINUTES OF THE
STATE HEALTH PLANNING BOARD MEETING
Thursday, May 5, 2016
Members Present:
Susan Olszewski, Chairperson
Judy Donlen (via phone)
Dr. Joseph Barone
Michael Gross
Michael Baker
Dr. Poonam Alaigh
Alison Gibson (Representing Commissioner O’Dowd, Department of Health)
Margaret Springer (Representing Commissioner Velez, Department of Human Services)
Susan Brewen-Alvino (Representing Commissioner Blake, Department of Children & Families)
Excused Absent:
Catherine Ainora
Henry Kane
Connie Bentley McGhee
Jon Brandt
Staff:
John Calabria
Jamie Hernandez
Michael Kennedy, DAG
CALL TO ORDER
Susan Olszewski, Chairperson opened the meeting at the Department of Health, Market and Warren St., H&A Bldg., 1st Floor, Auditorium, NJ on Thursday, May 5, 2016.
MOTION SUMMARY
1. Approval of February 4, 2016 minutes
Motion – Ms. Olszewski, Second – Mr. Gross
2. Approval of Certificate of Need Application for the Partial Transfer of Ownership of Hoboken University Medical Center
Motion – Dr. Donlen, Second – Dr. Barone
May 5, 2016
VOTING RECORD
VOTING BOARD MEMBER / ROLL / 1 / 2Dr. Donlen / X / Y / Y
Ms. Ainora / - / - / -
Mr. Kane / - / - / -
Ms. Olszewski / X / Y / Y
Ms. Bentley-McGhee / - / - / -
Dr. Barone / X / Y / Y
Mr. Baker / X / A / R
Mr. Gross / X / Y / Y
Dr. Alaigh / X / Y / Y
Mr. Brandt / - / - / -
Susan Dougherty (representing Mr. Conroy) – non voting member / X / - / -
Margaret Springer (representing Dr. Lind) – non voting member / X / - / -
Ms. Brewen-Alvino – non voting member / X / - / -
Total
Total Absent / 9 / 5-Y
0-N
1-A
0-R / 5-Y
0-N
0-A
1-R
KEY: Y=YES N=NO A=ABSTAIN R=RESCUE
1 ------X STATE OF NEW JERSEY
2 STATE HEALTH PLANNING BOARD DEPARTMENT OF HEALTH
3
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4
COMPUTERIZED TRANSCRIPT of the stenographic
5
notes of the proceedings in the above entitled
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matter as taken by DENISE L. SWEET, a Certified
7
Court Reporter and Registered Professional Reporter,
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at the DEPARTMENT OF HEALTH, Market and Warren
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Streets, HA Building, First Floor, Auditorium,
10
Trenton, New Jersey on Thursday, May 5, 2016, at
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9:30 in the forenoon.
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13
BOARD MEMBERS:
14 Susan Olszewski, Chairwoman
Alison Gibson
15 Suzanne Brewen-Alvino
Michael Kennedy
16 Dr. Joseph Barone
Michael Gross
17 Michael Baker
Dr. Poonam Alaigh
18 Dr. Judy Donlen (via speakerphone)
19 STATE DEPARTMENT REPRESENTATIVES: John Calabria
20 Susan Dougherty
21
PUBLIC COMMENT:
22 Paul Hollander, Esq.
23
APPLICANT REPRESENTATIVES:
24 Tom Kolb, Esq.
Leslie Prizant, Esq.
25 Ann Logan
I N D E X
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AGENDA: PAGE
2
I. Call to Order 4
3
II. Chairperson's Report 5
4 - Approval of April 9, 2015 minutes 5
- Approval of February 4, 2016 minutes 6
5
III. Commissioner's Report 6
6
IV. Certificate of Need Application for the 7
7 Partial Transfer of Ownership of Hoboken
University Medical Center
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A. Department Presentation 7
9 B. Public Comment on the Application 22
C. Applicant's Presentation 36
10 D. Board Discussion and Vote 57
11 V. Other Business 59
12 VI. Adjournment 60
13
14
15
16
17
18
19
20
21
22
23
24
25 CHAIRWOMAN OLSZEWSKI: We do have a
1 quorum, so our meeting can begin.
2 MS. HERNANDEZ: This is a formal
3 meeting of the State Health Planning Board.
4 Adequate notice of this meeting has been published
5 in accordance with provisions of Chapter 231, Public
6 Law 1975, c-10:4.10 of the State of New Jersey
7 entitled Open Public Meetings Act. Notice was sent
8 to the Secretary of State who posted the notice in a
9 public place. Notices were forwarded to 12 New
10 Jersey newspapers, one New York newspaper, one
11 Philadelphia newspaper, three news organizations and
12 the NJTV.
13 I will now call role. Ms. Gibson?
14 MS. GIBSON: Here.
15 MS. HERNANDEZ: Dr. Lind? Ms.
16 Brewen-Alvino?
17 MS. BREWEN-ALVINO: Here.
18 MS. HERNANDEZ: Mr. Kennedy?
19 MR. KENNEDY: Here.
20 MS. HERNANDEZ: Ms. Ainora? Mr.
21 Kane? Ms. Olszewski?
22 CHAIRWOMAN OLSZEWSKI: Here.
23 MS. HERNANDEZ: Ms. Bentley-McGhee?
24 Dr. Barone?
25
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1 DR. BARONE: Here.
2 MS. HERNANDEZ: Mr. Gross? Mr.
3 Baker?
4 MR. BAKER: Here.
5 MS. HERNANDEZ: Dr. Alaigh?
6 DR. ALAIGH: Here.
7 MS. HERNANDEZ: Mr. Grant? Dr.
8 Donlen?
9 DR. DONLEN: Here.
10 MS. HERNANDEZ: We have seven
11 members present, which does constitute a quorum.
12 CHAIRWOMAN OLSZEWSKI: Okay. Thank
13 you. Dr. Donlen, you're on the agenda for the
14 Chairperson's report. Do you have a report?
15 DR. DONLEN: No.
16 CHAIRWOMAN OLSZEWSKI: Okay. The
17 first item was the approval of the April 9, 2015
18 minutes, but there's not enough people here for us
19 to do that, so we -- oh, we do now? Now there are.
20 Okay. Just a moment. So, could you please state
21 your name? I'm sorry. Mickey Gross has joined.
22 He's a member of the State Health Planning Board.
23 So, does Mickey vote on this one?
24 MS. HERNANDEZ: No.
25 CHAIRWOMAN OLSZEWSKI: Okay. So,
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1 we are going to table the approval of the April 9,
2 2015 minutes.
3 But, we can look at approving the
4 February 4, 2016 meeting minutes. Do I have a -- is
5 there any discussion?
6 MR. GROSS: Motion to approve.
7 CHAIRWOMAN OLSZEWSKI: I'll second.
8 MS. HERNANDEZ: Ms. Olszewski?
9 CHAIRWOMAN OLSZEWSKI: Yes.
10 MS. HERNANDEZ: Dr. Barone?
11 DR. BARONE: Yes.
12 MS. HERNANDEZ: Mr. Gross?
13 MR. GROSS: Yes.
14 MS. HERNANDEZ: Mr. Baker?
15 MR. BAKER: I'll abstain.
16 MS. HERNANDEZ: Dr. Alaigh?
17 DR. ALAIGH: Yes.
18 MS. HERNANDEZ: Dr. Donlen?
19 DR. DONLEN: Yes.
20 MS. HERNANDEZ: We have five yeses.
21 Motion moved.
22 CHAIRWOMAN OLSZEWSKI: Okay. Thank
23 you. Next, do we have a commissioner's report,
24 Alison?
25 MS. GIBSON: We do not.
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1 CHAIRWOMAN OLSZEWSLI: No, we do
2 not.
3 MS. GIBSON: No, we do not.
4 CHAIRWOMAN OLSZEWSKI: Okay. Then
5 we will proceed to the business at hand, which is to
6 look at the Certificate of Need, Application for the
7 Partial Transfer of Ownership of Hoboken University
8 Medical Center.
9 Now, how we do this is, we start
10 with the Department presentation. Next, we have
11 public comment. Is there anyone from the public who
12 signed up to speak today? Just so you know, that's
13 up to an hour. Okay. One. Okay.
14 MS. HERNANDEZ: I have a list here.
15 CHAIRWOMAN OLSZEWSKI: Was there a
16 list? Okay. And the applicant's presentation and
17 then we'll have Board discussion and vote.
18 So, if we can start with the, okay,
19 yes, we do have Paul Hollander. Okay. That's you,
20 but we will start with the Department presentation.
21 So, John, you're up.
22 MR. CALABRIA: John Calabria,
23 C-A-L-A-B-R-I-A. Thank you and good morning to the
24 members of the Board. Today we're here to review
25 with you the application submitted for the partial
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1 transfer of Hoboken University Medical Center. The
2 ownership interest of the applicant will increase
3 from 9.9 percent to 25 percent and that goes over
4 the 10 percent threshold that we have for review of
5 all kinds of applications. I will, as is practice,
6 go over the Department's reasons for approval right
7 now and go over with you the conditions that we're
8 recommending be placed on such approval.
9 In the staff recommendations, based
10 on the documentation of proposed compliance with
11 regulatory and statutory criteria, Department staff
12 recommends approving the partial transfer of
13 ownership of HUMC Opco to MPT of Hoboken for the
14 following reasons and with the conditions noted
15 below.
16 First reason, this transfer is
17 expected to result in the continued promotion of the
18 sharing of services and administrative efficiencies
19 among Hoboken University Medical Center, CarePoint
20 Health, Bayonne Medical Center and CarePoint Christ
21 Hospital.
22 In March of 2012 MPT of Hoboken
23 acquired a 9.9 percent ownership interest in HUMC
24 Holdco. Subsequent to this change of ownership
25 interest, the overall occupancy rate for all
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1 maintained beds has remained relatively stable from
2 2012 through 2015.
3 Number three, applicant assures the
4 Department that MPT of Hoboken, a taxable Real
5 Estate Investment Trust subsidiary, will not and
6 cannot, as prohibited by IRS regulations,
7 participate in the management of the business and
8 operations of HUMC Opco and HUMC.
9 HUMC has operated in the region
10 traditionally serving the same primary and secondary
11 service areas and no data exists to suggest that
12 this partial transfer of ownership will change the
13 hospital's relationship with other Hudson County
14 hospitals or adversely impact the healthcare status
15 of the community.
16 Number five, the applicant assures
17 the Department that there will be no impact on the
18 number and work status of the current professional
19 and nonprofessional employees of the hospital and
20 clinic employees as a result of this transaction.
21 Six, the applicant has complied
22 with the Department's general transfer of ownership
23 criteria. There is a willing buyer and seller. The
24 buyer has presented a financially feasible project
25 and the buyer does not have any identifiable track
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1 record violations sufficiently serious to warrant
2 denial of the application.
3 The application and its attachments
4 shall be incorporated and accepted as conditions of
5 licensure.
6 Number eight, the applicant has
7 stated that HUMC Holdco, MPT of Hoboken and HUMC
8 Opco, in accordance with regulation, will not deny
9 admission to any patients on the basis of their
10 inability to pay or source of payment.
11 I'll go into conditions and there
12 have been changes that were sent to the Board
13 yesterday in the original submission by the
14 Department. These were at the request of the
15 applicant due to concerns that some of you had
16 originally that could imply or hint at that they had
17 some operational control of the hospital, which is
18 not the case.
19 So, the conditions, number one,
20 HUMC Opco shall file a licensing application with
21 the Department's Division of CN Licensing to execute
22 the proposed partial transfer of ownership of HUMC
23 Opco to MPT of Hoboken.
24 In accordance with regulation, HUMC
25 Holdco and MPT of Hoboken shall provide prior
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1 notification in writing to the Division of any
2 change in their respective ownership interests in
3 HUMC Opco.
4 MPT of Hoboken, number three, MPT
5 of Hoboken must meet with the Department to discuss
6 its plans before taking any extraordinary action as
7 identified in section 3.14(a) of the LLC agreement.
8 Before MPT of Hoboken takes any
9 extraordinary action identified in section, of
10 sections of that agreement, except with respect to
11 the marketing of the hospital for sale, it shall
12 submit an application for a CN to the Division in
13 accordance with statute and regulation and obtain a
14 CN from the Department.
15 Provision number five, for the
16 initial five years following the transfer of
17 ownership, the following reports shall be submitted.
18 HUMC Opco shall submit annual reports to the
19 Division detailing an annual accounting of any long-
20 or short-term debt or other liabilities incurred on
21 the hospital's behalf and reflected on HUMC Opco's
22 balance sheet, and also a list of completed capital
23 projects itemized to reflect both the project and
24 its expenditure. Finally, the members of HUMC Opco
25 shall submit reports to the extent such member has
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1 made an investment in HUMC during the previous year
2 Number six, HUMC Opco’s annual
3 audited financial statements shall be posted on the
4 hospital's website within 180 days of the close of
5 the hospital's fiscal year and shall ensure that the
6 hospital's quarterly unaudited financial statements
7 are posted on the website within 60 days of the
8 close of the hospital's fiscal quarter. All annual
9 and quarterly statements shall be prepared in
10 accordance with generally accepted accounting
11 principles. With respect to the posting of
12 quarterly unaudited financial statements, HUMC Opco
13 may include disclaimer language regarding the
14 unaudited nature of the quarterly financial
15 statements on its website where such statements are
16 posted.
17 Number seven, within 60 days of
18 posting its audited annual financial statements to
19 its website, HUMC Opco shall hold an annual public
20 meeting in New Jersey pursuant to statute and shall
21 make copies of those audited annual financial
22 statements available at the annual public meeting.
23 HUMC Opco shall develop mechanisms for the meeting
24 that address the following: A, an explanation in
25 layperson's terms of the audited annual financial
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1 statement; B, an opportunity for members of the
2 local community to present their concerns to HUMC
3 Opco regarding local healthcare needs and hospital
4 operations; C, a method for HUMC Opco to publically
5 respond in layperson's terms to the concerns
6 expressed by community members at the annual public
7 meeting; and, D, HUMC Opco shall develop these
8 methods, A through C above, within 90 days of the
9 date of this approval letter and provide them to the
10 Division.
11 Number eight, HUMC Opco shall
12 maintain compliance with the United States
13 Department of Health and Human Services standards
14 for Culturally and Linguistically Appropriate