The Valley Hospital in Ridgewood is pursuing litigation to stop the likely opening of a 128-bed hospital in Westwood, Valley’s board chairman said Thursday.

“The board strongly believes that opening another hospital in this region will severely damage existing hospitals and the health care system of Bergen County,” said Vincent Forlenza, chairman of the Board of Trustees.

The State Health Planning Board voted 5-1 this week to send a recommendation for approval of a scaled-down version of Pascack Valley Hospital to Health Commissioner Mary O’Dowd, who is expected to make her decision by the end of the year.

The board “has agreed to move forward with a legal strategy so that this issue may ultimately be resolved in a court of law,” Forlenza said in a prepared statement.

A lawsuit can’t actually be filed until the health commissioner takes action, but the decision to pursue litigation was made by the board at its regularly scheduled meeting Wednesday.

Valley Hospital and Englewood Hospital and Medical Center have long opposed Hackensack University Medical Center’s plan to open a hospital at the former Pascack Valley site, claiming the area already has excess beds.

A report by the staff at the state health department strongly endorsed the plan, known as HackensackUMC at Pascack Valley.

Not only will the hospital strengthen health care in the area, but failure to establish the hospital “would place the residents of the Pascack Valley and Northern Valley at greater risk when health care emergencies arise and immediate care is essential,’’ the state concluded.

Valley officials suffered twin defeats Tuesday. The Ridgewood Village Council overwhelmingly rejected the hospital’s $750 million proposal to double in size, citing concerns over traffic, construction and safety of residents and their homes.

Forlenza said a decision regarding the council’s action has not been determined. “We will take some time to review all options available to us,” he said

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The final hearing about Hackensack University Medical Center’s plan to reopen Pascack Valley Hospital has been postponed for several weeks.

Instead of meeting on Nov. 3, the State Health Planning Board will convene on Nov. 29 to consider the plan to operate a 128-bed in Westwood.

“Department staff couldn’t get a quorum,” said Donna Leusner, a spokeswoman for the state Department of Health and Senior Services, explaining the change in rescheduling.

The time and place for the meeting, to be held in Trenton, will be announced soon.

Earlier this month, more than 1,000 people attended a hearing of the board in Washington Township, virtually all of whom supported Hackensack’s plan to provide acute care services to the Pascack Valley.

The next meeting is the final public hearing — and the board is expected to make a recommendation to Health Commissioner Mary O’Dowd at that time.

“There’s a lot of public interest in this application,” Leusner said.

The Valley Hospital in Ridgewood and Englewood Hospital and Medical Center oppose Hackensack’s plan, claiming Bergen County has a glut of beds daily in Bergen County. They say reopening the hospital will cause economic harm to neighboring hospitals.

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To say the movement to open a new hospital on the site of the closed Pascack Valley Hospital is not about politics is naïve.

Not that the residents who packed Westwood Regional High School’s two auditoriums last week for a hearing with the state health planning board were there with a political agenda. Wearing green shirts provided by Hackensack University Medical Center (HUMC), which runs the satellite emergency room at the Pascack site and plans to open a new hospital with the help of a for-profit company, their pleas for a new hospital after their old one closed were made with a genuine concern for their quality of life.

The residents want a full-service hospital close to them. Who wouldn’t? But they weren’t the only ones to speak at the hearing. They were treated to a parade of state and local officials. A common refrain that night was that the residents are in overwhelming support of getting their hospital back. Again, that’s obvious. Why would anyone in the community say no to that?

But a representative from Valley Hospital in Ridgewood asked everyone to look outside of the region. Pascack Valley wasn’t the only hospital to close recently. At least a handful in New Jersey shut their doors in just the last five years. When residents in Paterson and Plainfield lost their hospitals they held rallies pushing for new ones, but the Pascack Valley effort is different.

The other communities didn’t have a powerful candidate for governor talk up the need to reopen their hospitals during his campaign. They didn’t get a hearing with the state or have the same collection of politicians “Fighting to reopen ‘Our Hospital,’” as it said on a flier that I was handed when I stepped outside of the school.

The flier urged me to re-elect Judge Mike Dressler for Bergen County Surrogate. I get that the state representatives Sen. Gerald Cardinale, D-39, Assemblyman Robert Schroeder, D-39, and Assemblywoman Charlotte Vandervalk, D-39, were there for their residents. But I’m baffled how the county surrogate involved himself in the state’s process to determine if a new hospital should be opened. That position’s main responsibility is settling estates after people die. How exactly would he help this cause if re-elected?

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Supporters of a proposal to reopen a hospital in Westwood voiced their desire at a hearing held Oct. 19 by state officials. Representatives from other local hospitals, however, are concerned that the return of a hospital to the former Pascack Valley Hospital site would lower the quality of existing facilities in the area. Englewood Hospital and Medical Center and Valley Hospital in Ridgewood have been vocal in lobbying against the efforts of Hackensack University Medical Center to reopen Pascack Valley Hospital with the help of a for-profit company.

“We project that we will lose more than 1,800 admissions and many more outpatient visits, with a loss of $15 million in revenue [if Pascack is reopened],” said Michael Pietrowicz, senior vice president of Planning at Englewood Hospital and Medical Center. “To survive that kind of revenue loss, Englewood will have to lay off hundreds of employees, and we will have to sharply cut healthcare services in our community, including charity care.”

One of the reasons behind the Englewood and Ridgewood officials’ opposition is the belief that the Pascack Valley facility would not fulfill the requirements for a Certificate of Need, a state law that helps regulate whether a hospital is necessary to be built in a community. Maria Margiotta, director of Marketing and Communications at Englewood Hospital, believes that the facility would fail to meet two important criteria of the law. An apparent need for hospital beds is the first criteria. No such need exists, says Margiotta, as there is a surplus of 375 to 400 acute care beds throughout Bergen County hospitals on a daily basis.

The second factor involves the assertion in the proposed hospital’s application is that it wouldn’t cause financial harm to existing hospitals. The hospitals believe that reopening Pascack Valley would not create new jobs, but instead potentially move staff from one location to another. With staff disappearing to work at Pascack Valley, the quality of service at Englewood and Valley hospitals could drop, as there wouldn’t be as many ready, able hands.

“If the state allows this hospital to open, another will close,” said Gail Callandrillo, the vice president for Planning at Valley Health System. “The demographics and the economics of Bergen County simply cannot support six acute care hospitals. This is precisely why Pascack Valley Hospital closed in the first place.”

Englewood officials says its quality of service, including fewer Emergency Room diverts and lower wait times, has actually improved since Pascack Valley closed in 2007.

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Opponents of the proposal to reopen the former Pascack Valley Hospital in Westwood launched an eleventh-hour salvo to block the project Tuesday, as both sides prepared for a public hearing tonight in Bergen County‘s epic health care battle.

The State Health Planning Board will hear testimony beginning at 6 p.m. at Westwood Regional Junior/Senior High School, as it considers its recommendation to state Health Commissioner Mary O’Dowd on whether to approve or reject the proposal from Hackensack University Medical Center.

Hackensack has proposed reopening the hospital with 128 beds in a joint venture with the for-profit Legacy Hospital Partners of Texas, to serve the Pascack and Northern valleys.

The project “has been right-sized” for the area, Hackensack executives say, and is less than half the size of the hospital that closed in 2007.

Executives from Englewood Hospital and Medical Center and The Valley Hospital in Ridgewood conceded Tuesday that they expect O’Dowd to approve the project. Governor Christie had pledged his support for it as a candidate in 2008.

“The process has become as political as the expected outcome,” Englewood President Douglas A. Duchak said.

Their next step, said Duchak and Audrey Meyers, Valley’s president, will be to “go to court.”

The two hospitals released reports Tuesday from a consultant they hired. Bergen County will have 375 to 488 excess hospital beds in 2015, even without the new hospital, one report said. That estimate takes into account the aging population and the trend toward same-day surgery.

The second report said the reopening will cause a financial hit of $7 million to $15 million at Englewood and $10 million to $24 million at Valley. “That’s a lot of jobs,” Duchak said.

Those reductions could make it more difficult to obtain financing for Valley’s plan to modernize, which will double the size of its facility in Ridgewood. That project will still go forward, Meyers said.

“The current proposal to open a hospital in an area of no unmet need is particularly problematic,” the $12,000 Ingenix Consulting report said. “Not only would the new hospital’s survival be very much in doubt, but it could very well cause the demise of other now healthy organizations.”

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On the eve of a Health Department hearing on Hackensack University Medical Center’s plan to reopen the former Pascack Valley Hospital, in Westwood, opponents on Tuesday released new studies they commissioned that support their argument that Bergen County has excess hospital beds and reopening the hospital will divert hundreds of patients and millions in revenue from Valley Hospital, in Ridgewood, and Englewood Hospital and Medical Center.

The hearing by the State Health Planning Board, expected to draw hundreds, will be 6 to 8 p.m. Wednesday at Westwood Regional Junior/Senior High School, in Washington Township.

No ‘compelling evidence’

David Knowlton, CEO of the New Jersey Health Care Quality Institute, was the state-appointed patient care ombudsman at Pascack Valley, and was at the hospital when it closed in 2007 after filing for bankruptcy.

“I so far have not seen any compelling evidence that people have been without care” as a result of the closing, he said.

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A plan to resurrect a shuttered New Jersey hospital—potentially the first such facility to re-open after two decades of closures in the state—is drawing fire from competing medical centers that say it would weaken health care in the region.

Hackensack University Medical Center in Bergen County is moving forward with plans to re-open Pascack Valley Hospital as a 128-bed for-profit medical facility. The state’s Health Planning Board is now reviewing the plan, and Mary O’Dowd, the state’s health commissioner, is expected to issue a final decision by the end of the year.

But competing hospitals said the drive to re-open the hospital has become politicized and is not based on sound health-care policy.

Adding another hospital in the region, they say, will make it more difficult to survive for other Bergen facilities that are already operating on slim margins.

Many of the employees who would be hired back to Pascack—in the borough of Westwood, N.J.—would likely be pulled from existing medical facilities as well, critics say.

Gail Callandrillo, vice president of strategic planning and government relations at Valley Hospital in nearby Ridgewood, said re-opening Pascack “would totally destabilize a very shaky market.”

Nearly two dozen New Jersey hospitals have closed in the past 20 years, including Pascack Valley in 2007. None have re-opened, but Hackensack officials said Pascack Valley would immediately fill a void. “The hospital didn’t close because of a lack of need,” said Robert Garrett, president and chief executive of Hackensack. “We think there is a good need for beds.”

Hackensack has teamed up with Texas-based LHP Hospital Group Inc. to run Pascack Valley Hospital.

About $60 million of renovations on the hospital have been proposed.

But the plans have met vociferous opposition. Douglas Duchak, chief executive of another competing hospital, Englewood Hospital and Medical Center, fired off a letter to the state’s health commissioner expressing his “outrage and disappointment” over the department’s recent decision allowing Hackensack’s application to move forward despite objections from Englewood and Valley Hospitals.

“Principally, there is an oversupply of beds in the area that continues to grow,” said Mr. Duchak. There are about 2,000 hospital beds in Bergen.

Westwood Mayor John Birkner calls the criticism “disingenuous and self-serving.”

“I think their opposition to Hackensack is purely a competitive one,” Mr. Birkner said.

Pascack was founded in the 1950s as a nonprofit hospital. In the past decade, its finances were strained when it lost a crucial health-insurance contract and got saddled with debt from a major construction project.

When it closed, nearly 1,000 jobs were lost.

“The impact on the senior-citizen population has been particularly dramatic,” said Mr. Birkner, who has been a vocal supporter of reopening Pascack.

In 2008, Hackensack bought Pascack at a bankruptcy auction for $45 million with plans to reopen the hospital.

When the hospital closed, it had 291 beds. The new plan would reduce that number by more than half.

“We were very careful in how we sized this facility,” Mr. Garrett said. “We didn’t want this project to have an adverse effect on other providers in the area.”

Write to Joseph De Avila at joseph.deavila@wsj.com

With state Health Commissioner Mary E. O’Dowd expected to decide next month whether Pascack Valley Hospital, in Westwood, should be reopened by Hackensack University Medical Center, opponents on Friday released dozens of documents and a lengthy statement arguing there is no need for the facility’s 128 additional hospital beds, which they say will harm Bergen County hospitals that are now stronger financially in the wake of Pascack’s 2007 closure.

The statement, by Englewood Hospital and Medical Center to O’Dowd, also raised questions about Hackensack UMC’s for-profit partner in the new hospital, Texas-based Legacy Hospital Partners. According to the statement, the current chairman and CEO of Legacy “were executives with Columbia/HCA (now HCA) in the 1990s, when Columbia/HCA was implicated in the largest Medicare fraud in U.S. history. At the time, these executives were supervising dozens of Columbia/HCA hospitals found guilty of Medicare fraud. The aggregate fines and penalties totaled $1.7 billion — the largest amount ever assessed for Medicare fraud.”

The two Legacy executives, CEO Dan Moen and Chairman James Shelton, were not named or charged by the U.S. Justice Department in its prosecution of the Medicare fraud case. Rick Scott, who was CEO of Columbia/HCA when the fraud occurred, resigned from the company in 1997, and became governor of Florida in January 2011.

Legacy spokeswoman Patricia Ball said the company would welcome thorough scrutiny of Moen and Shelton: “They are very well respected in the health care industry, and any investigation into either one of them would be very positive for LHP.”

In an interview Friday, Michael Pietrowicz, Englewood’s senior vice president for planning, and the hospital’s outside counsel, James M. Hirschhorn, of Sills, Cummis & Gross, said the hospital submitted 32 questions to the Department of Health that it believed should be addressed before the reopening is considered, but instead the department deemed Hackensack UMC’s application complete, and scheduled an Oct. 19 public hearing on the issue in Westwood without first addressing the questions.

Battle lines drawn

As commissioner, O’Dowd decides whether Bergen County needs to reopen the hospital; to do so, she will weigh two diametrically opposing views of the fact on the ground: Englewood contends years of expert analysis and hospital industry experience proves there’s a surplus of hospital beds in Bergen County, while Hackensack says its hospital operates at capacity, and could easily fill the 128 beds it plans to open at Pascack Valley next year, following a major renovation.

Hackensack UMC now operates a satellite emergency department at Pascack, which it opened shortly after acquiring the bankrupt hospital. Hackensack UMC CEO Robert Garrett contends Pascack Valley didn’t close for lack of patient demand, but because it made several risky financial decisions, including a major investment in a new wing, and quit the hospital network of Horizon Blue Cross Blue Shield of New Jersey, the state’s largest health insurer.

Seasoned health care experts in New Jersey say politics will play a role in the decision — and that politics always is a factor with hospitals, which invariably rally support from their legislators and the citizens they serve. In an Oct. 10 letter to O’Dowd, Englewood contended the Pascack Valley process “has been corrupted by politics.” During his campaign, Gov. Chris Christie visited Pascack Valley and expressed his support for its reopening; Christie’s office has declined to comment on the matter while it is before the Health Department.

Pietrowicz said Englewood would lose nearly $15 million if it loses the patients it now serves from the 14 towns that used to use Pascack Valley. “We would have to look at services to eliminate or cut back on … and hundreds of employees would be laid off,” he said. Englewood, he added, has revenue of about $360 million and generates an annual surplus of between $1 million and $5 million “that we use to invest in equipment, staff, technology.”

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Leaders of Englewood Hospital and Medical Center are calling for a public hearing in Englewood over whether Pascack Valley Hospital should be reopened.

The state said Friday that Hackensack University Medical Center’s application to open a 128-bed community hospital at the Pascack site is complete and scheduled a hearing on the issue for Oct. 19 inWashington Township.

But Englewood executives, who have been fighting the plan along with leaders of The Valley Hospital inRidgewood, have said North Jersey already has more than enough hospital beds and reopening Pascack will hurt existing medical centers.

Douglas A. Duchak, president and CEO of Englewood, said in a letter Monday to state Health Commissioner Mary E. Dowd that under the state’s own guidelines, a new hospital shouldn’t be “detrimental to neighboring providers.”

“Consistent with that aspect of the regulations and an appeal to fairness, we would request a second public hearing be scheduled in the Englewood area,” he wrote.

Hackensack wants to open the new hospital through a joint venture with LHP Hospital Group, a for-profit management and investment firm from Texas.

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