The Facts
- Hackensack University Medical Center, in a joint venture with a Texas private equity firm, Legacy Hospital Partners, is seeking approval to open a new for-profit, acute-care inpatient hospital on the former Pascack Valley Hospital (PVH) site.
- The 2008 Final Report of the New Jersey Commission on Rationalizing Health Care Resources found that: “The State currently faces an oversupply of hospital beds that is manifest in every market area of the State, but most pronounced in the Hackensack, Ridgewood, Paterson and the Newark/Jersey City market areas.”
- In part because of this over-supply, Pascack Valley Hospital suffered from low occupancy rates, filed for bankruptcy, and ultimately closed in November 2007.
- In late December of 2007, then NJ Commissioner of Health Fred Jacobs stated: “I have also taken into consideration the statutory requirements to determine whether the action proposed (to close PVH) will have an adverse economic impact or financial impact on the delivery of health care services in the region or statewide and will contribute to the orderly development of adequate and effective health care service. As previously noted there will be sufficient regional bed capacity to meet the need for inpatient acute care services even after the closure of PVH. I find that the discontinuance would strengthen the nearby hospitals located in PVH’s service area by increasing their occupancy and contributing toward rationalizing the delivery of inpatient care services in the region.”
- The closure of PVH has produced increased occupancy rates and financial stability in the remaining Bergen County hospitals. Additionally, if needed, there remains licensed capacity in each of the Bergen County hospitals to further expand their inpatient beds, outpatient services and emergency services.
- The closing of Pascack Valley underscores the fundamental premise that there had been too many acute-care beds in Bergen County. From a countywide perspective, however, the closure is actually a positive, as numerous studies have shown that an over-supply of acute care beds actually worsens healthcare. Indeed, recent studies by Dr. Elliott Fisher at Dartmouth College have indicated that there is higher mortality in high-capacity, high-utilization areas than in low-capacity, low-utilization areas.
- While we support an emergency facility at the PVH site, we do not support adding the infrastructure of an acute-care, inpatient hospital, complete with all of the administration, overhead and equipment needs makes resources redundant and compromises healthcare quality.
- The vast majority of hospitals in New Jersey are community-based, not-for-profit entities governed by local boards and are accountable to the communities they serve. Dollars generated through operations are invested back into the hospital for new equipment, facilities and program development. Conversely, for-profit hospitals are beholden to investors and not accountable to the communities they serve. Profits generated through operations are returned to investors and not necessarily invested back into the community. Developing a new for-profit hospital in a region that has excess capacity will cause irreparable harm to the region’s fragile healthcare system and ultimately affect the quality of care delivered.
- This for-profit joint venture could significantly damage the financial and operational strength of the other Bergen County hospitals, thereby destabilizing the region and reversing the benefits that have been provided to local residents.
- The proposals put forth by Hackensack, in conjunction with Legacy Hospital Partners, are merely designed for profitable ends, not for providing better care to northern New Jersey residents.
