For Immediate Release Contact: Jeanne Otersen (201)280-9279
August 15, 2014
Statement of Ann Twomey, President of the Health Professionals and Allied Employees (HPAE)
“Jerrold Binney was the architect of one of the most costly, ill-conceived and damaging privatization schemes in NJ history,” said Ann Twomey, President of NJ’s largest union of nurses and healthcare workers, including 400 nurses and professionals at Bergen Regional Medical Center. “This privatization plan was especially egregious because it allowed private owners to reap enormous profits at great expense to conditions for Bergen County’s most vulnerable, ill and elderly patients, their caregivers as well as taxpayers. For County Executive Donovan to appoint Mr. Binney as Acting Administrator now, as we begin to plan the future of Bergen Regional Medical Center is so misguided that it is stunning. “
Bergen Regional Medical Center , formerly Bergen Pines, was leased to an out-of-state for-profit company under Mr. Binney’s direction in 1997, while he was chief of staff and County Administrator to former County Executive William ‘Pat’ Schuber. Shortly afterwards, Mr. Binney went to work for the DeCotiis lawfirm, which wrote and executed the contracts on behalf of the County. Bergen County is now engaged in litigation with DeCotiis over the contract, which is set to expire in 2017.
Ms. Twomey continued: “Mr. Binney and Mr. Schuber’s administration were determined to privatize our County Hospital in 1997, despite the hospital’s sound financial situation. They picked a company with no experience in running a hospital – let alone a hospital of the size and scope of Bergen Pines. Binney, with the DeCotiis law firm, designed and executed a contract that had few standards for quality care, no enforcement mechanism, and gave the for-profit company millions in profits, leaving the County and its taxpayers paying the tab for millions in capital improvements. The privatization scheme included $33 million in undisclosed no-and low-interest loans to the private owners, loans that became the subject of a citizen lawsuit years later. The loopholes in the contract allowed the ‘Solomon Health Group’ to slash staffing levels, cut services and avoid any penalties. Much of the impact on patient care was already evident – and ignored – during Binney’s tenure. Lawsuit after lawsuit followed. Years later, we are all still paying the price – in decreased staff, services, quality and increased taxpayer costs. Now, when we most need to come together to design a better future for our County hospital, County Executive Donovan would return us to the worst practices of the past.”
1997: Bergen County puts out bids for the ‘lease’ of Bergen Pines County Hospital, a one- hundred year old hospital, originally established as a tuberculosis hospital, and a public ‘safety-net’ hospital . Bergen Pines was also the largest hospital in the state, with 1100 beds, including 300 psychiatric beds (long-term inpatient; detox; acute); 100 acute-care beds and 700 long-term care beds. The long-term care unit consistently had a waiting list, in part due to its lower cost and higher ratio of RNs to patient than any other nursing home in the area.
In order to avoid the regulation and scrutiny that would come from a 20-year lease, or sale, of the public hospital, Bergen County offered a 19-year lease. Solomon Health Group was the winning bidder, even though their previous health care experience was running 11 small nursing homes in Colorado, and they were already the subject of lawsuits in their home state.
HPAE, representing 425 Registered Nurses at the facility, opposed the privatization of the hospital, along with local community groups, NJ Citizen Action, churches, the NAACP, Gray Panthers, Assemblywoman Loretta Weinberg and other health care unions.
March 1998 – The Deal
Solomon takes over the hospital management and 19-year lease under the following terms:
· BRMC/Solomon pays the BCIA rent for the use of the land, property and equipment of the Medical Center. In 2002, the annual rent was a mere $5.5M.
· The BCIA guarantees BRMC/Solomon $9M/month to fund the cash flow obligations of the hospital. Revenues in excess of the $9M are retained by BRMC. In 2002, BRMC had net patient service revenues of $135M.
· The BCIA also provided BRMC/Solomon with a $6M working capital loan that is non-interest-bearing through March 2006, and principal repayments do not begin until 2007.
· In addition, BRMC/Solomon enjoys a $27m loan from the BCIA, non-interest-bearing until 2015, with payment due in 2020. The loan is made up of the revenues, receipts and all other payments received by BRMC from Medicaid, Medicare or other third-party payors for services provided by Bergen Pines prior to the contract between the BCIA and Solomon.
The Early History of Patient Care
1998-1999 – Despite early reports of compromised patient care, and understaffing, the County and BCIA seem helpless or unwilling to force Solomon to adhere to the contract terms.
Two deaths occur at BRMC in February of 1999 that are later the subject of wrongful death suits and result in 90,000 in fines from the NJ Department of Health.
An independent consulting group – Excellence In Caring – hired by Bergen County to review the quality of care provided at Bergen Regional Medical Center by the for-profit management affiliate, Solomon Health Group, called care at the Center ‘substandard’ and understaffed.
According to the report “some units appearing to be chronically understaffed”. Using actual time worked by nursing staff only, Solomon Health Group was in violation of contractual obligations to provide 3.3 hours of direct patient care to each resident 15 out of 31 days in May of 1999, 10 days in June, and 21 in July. EIC noted that a weight loss audit indicated a higher than average-weight loss among residents, related to “the amount of residents needing attention and the lack of hands-on staff needed to feed them.” Problems with providing adequate amounts of food were noted and the management’s cuts in food supplies were also faulted. EIC also noted a higher than average number of patient injuries and falls and bedsores. a decline in the quality of life and dignity of the patients due to inadequate staffing, lack of training and education for staffing and lack of recreational programs. In addition, an overuse of physical restraints, which “directly relates to staffing numbers” was noted.
Joint Commission for Accreditation of Health Care Organizations ratings for BRMC’s long-term care facility fell by more than 10 points between 1996 and 1999 inspections;
An additional $18,000 in fines from the NJ Department of Health following its annual inspection conducted in September, 1999. The fines were related to 14 violations – including building codes, and quality of life. The fines, originally set at $8,600, were increased after a re-inspection in November-December of 1999.
2002: NJDHSS inspected the acute care and behavioral health divisions and found violations of staffing, dietary and other regulations. The NJDHSS fined BRMC $22,500 for failure to provide safe staffing; and $16,500 for failure to provide for patients’ nutritional needs.
2002: Layoff of employees in 2002, resulting in the virtual elimination of the Occupational Therapy program in the Behavioral Health Division, the Music Therapy program in Long Term Care, and the once-heralded Geriatric Evaluation and Management (GEM) Program; significant reduction in the number of psychological tests performed; cutbacks in recreation and art therapy, and curtailment of many other programs
· Virtual elimination of the outpatient Dental Clinic and other clinic services
· Closure of the Day Health Program
· Closure of most of the senior citizen outreach and health screening programs based in communities throughout Bergen County.
2004 –The NJDHSS asked the BCIA to prove that they are meeting their legal obligations as licensees through controls over BRMC. In December of 2004, after receiving BCIA response, NJDHSS again asked for specific information of proof of oversight and control, including staffing levels. By 2004, RNs have been cut back by 40%, accordng to union records.