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Long Island College Hospital bids submitted Wednesday; three hospital proposals in the mix

Long Island College Hospital. Photo: Mary Frost

Public forum on Tuesday, March 25

Brooklyn Daily Eagle

Win, lose or draw, the developers, financiers and medical teams competing in the bidding war for Brooklyn's Long Island College Hospital (LICH) submitted their final and best proposals to SUNY on Wednesday, March 19.

That wraps phase one for SUNY’s reissued Request for Proposals (RFP), painstakingly drawn up after a ferocious legal battle waged by community members, local officials and employees to keep LICH open as a full service hospital.

The six community organizations who were petitioners in the LICH litigation are sponsoring a public presentation of the proposals submitted by RFP respondents who have accepted their invitation. All are invited to the forum on Tuesday, March 25th, from 6 to 8 p.m. at St. Francis College, Founder’s Hall Auditorium, 180 Remsen Street, Brooklyn Heights.

The sponsoring organizations include the Boerum Hill Association, Brooklyn Heights Association, Carroll Gardens Neighborhood Association, Cobble Hill Association, Riverside Tenants Association and Wyckoff Gardens Association.

Panels made up of representatives of SUNY and representatives chosen by the petitioners in the lawsuit will have until March 26 to evaluate the proposals.

“Today the State University of New York and communities in Brooklyn took an important step forward in determining how health care services will be provided at Long Island College Hospital, and ensuring the long-term viability of SUNY’s vital medical school and University Hospital," said SUNY spokesperson David Doyle. “The deadline for responses to SUNY’s Request for Proposals (RFP) has passed and proposals meeting the mandatory requirements will now be reviewed.

“The proposals will be made publicly available, and evaluated and scored in partnership with representatives from the community, in accordance with the State of New York’s rules and regulations and the Public Officer’s Law," he said. Evaluations will be completed in one week.

“SUNY has always been committed to Brooklyn, our medical school, our patients, our many skilled and talented doctors, health care professionals, and faculty and staff. We are confident that this open and transparent process will result in SUNY’s ability to better serve and educate the borough while delivering a mutually agreed upon provider of healthcare services at LICH that is suited to meet the needs of the Brooklyn community.”

A board meeting is planned for April 3 to discuss the outcome with their trustees, and negotiations with the winning bidder should commence on April 4.

Public forum on LICH proposals

While SUNY’s original RFP had been tilted towards real estate development, the reissued RFP was designed, under the guidance of state Supreme Court Justice Johnny Lee Baynes, to insure that bidders proposing a full service hospital would land at the top of the heap.

Attorney Jim Walden of Gibson, Dunn & Crutcher told the Brooklyn Eagle last Friday, “In light of the scoring preference for a full service hospital, a proposal for one should win the day.” Walden represents six community groups and others in the legal battle to keep LICH open.

LICH supporters appear optimistic that the reissued RFP has attracted new participants to the table with bolder, more community-oriented proposals than those that entered the first rounds of bidding.

Charlene Nimmons, President of the Wyckoff Gardens Resident Association, said she was impressed with a proposal by Brooklyn Health Partners' to revitalize the LICH site into a Brooklyn Medical District with a full-service hospital at its core. The proposal includes ambulatory and long-term care and skilled nursing satellite facilities, and  "integrated the community into their plan," she said. Like other bids, the proposal includes market-rate and affordable apartments, retail and commercial development.

Another group that has previously proposed a full service hospital is the Chinese Community Accountable Care Organization, partnering with the Eastern Chinese American Physician IPA, developer John Catsimatidis and Rudy Washington. This group has also promised to integrate community priorities into their proposal. Thier plans for the redevelopment of LICH's non-core properties not yet been made public.

A non-profit foundation is also said to be in the race, but that has not been confirmed.

Other bidders, including Fortis Property Group and the Related Companies, have previously presented plans that largely seek to redevelop as residential and commercial LICH’s 20 properties, with a much smaller medical footprint for ambulatory care and “standalone” ERs operated by healthcare partners including NYU and The Brooklyn Hospital Center.

Others who have previously indicated an interest in submitting proposals include Peebles Corporation (partnering with the Institute for Family Health), and Brisa Builders (partnering with the Chetrit Group), but they have not announced publically that they will be in the running this time around.

Under the new RFP, plans without hospitals would receive fewer points than plans calling for a full service hospital.

Panels made up of representatives of SUNY and representatives chosen by the petitioners in the lawsuit will have until March 26 to evaluate the proposals.

SUNY said a board meeting is planned for April 3 to discuss the outcome with their trustees, and negotiations with the winning bidder should commence on April 4.

 

SUNY submits LICH draft closure plan

SUNY Downstate, with enormous cash flow problems, is anxious to vacate LICH as soon as possible.

Lora Lefebvre, SUNY’s Associate Vice Chancellor for Health Affairs, said at a board of trustees meeting on Tuesday, “We are focused on closing the LICH operations by May 22.

“The Downstate team has been all over this,” she told the board. “They have already submitted a draft closure plan, and had a number of discussions with the Department of Health. We’ve already begun downsizing the number of folks at LICH that aren’t necessary for the services there.”

Last week roughly 170 nurses and more than 300 healthcare workers received layoff notices for April.

Downstate council Ruth Booher told the board that the RFP decision would be "binary," that is, yes or no. If a proposal meets the criteria and it’s ranked number one, then that would be the winning bid.

"If this board were to decide that awarding to the highest evaluated bidder is not as good as going back to litigation, then we could decide to go back to litigation," she said. "Most of us would say, 'Oh, that would never happen.' But if the proposal is so horrendous, you might. But that is the nature of the binary decision.”

A trustee commented, “Under the settlement agreement, it would be hard for that proposal to be such a bad proposal because then it wouldn’t meet the restrictions.”

"Very hard," Booher agreed.

The settlement contains a “waterfall” provision, Booher said. The top evaluated proposal which meets the minimum price will receive the award. If SUNY is unable to negotiate a contract with this proposer within 30 days, it goes to the next highest on the list. This continues until a proposal is hit that doesn’t meet the objectives of the RFP.

If there are no suitable bids by May 22, LICH will simply close. SUNY Chairman H. Carl McCall commented on this possibility: “Which means at that time we would be able to dispense of the property without any consideration of medical services, etc. Which means the property would be able to attract a much higher return.”

Talking finances, Lefebvre said that from the money it receives for LICH, SUNY is obligated to first pay $118 million worth of Personal Income Tax (PIT) bonds, and $140 million to restore the Othmer Endowment fund. SUNY also owes third parties sums related to LICH, and needs to pay back a SUNY loan of $75 million.

Raising questions about an endowment that SUNY is obligated to replenish, however, she added that while the $140 million Othmer Endowment money is “an obligation SUNY has, it’s certainly one we feel deserves more discussing in the future with the courts.”

While the settlement brought an end to litigation, state Supreme Court Carolyn Demarest retains jurisdiction over the trust-related issues.

 

The RFP nitty gritty:

* The evaluation committees will have two categories: technical, which will rate the quality and scope of hospital and medical services offered; and financial.

* The technical category will count for 70 percent of the ultimate score; financial considerations will count for 30 percent. Representatives of SUNY will make up 51 percent of the technical committee and all of the financial committee.

* Any proposal without hospital beds and an intensive care ward will receive a lower technical score, as will proposals offering only a “freestanding emergency room.”

* Proposals with a teaching hospital affiliation will receive higher scores.

* A proposal that offers to never shut LICH’s doors in the transition process will receive a higher technical score.

* The reissued RFP requires a minimum bid of $210 million. A bid over $240 million will result in profit sharing – 75 percent to SUNY and 25 percent to a community group.

* If no proposal is found that satisfies the RFP, the process is over. If there are no suitable bids by May 22, LICH will close.

 

Other groups participating in the litigation include the New York City Public Advocate, New York State Nurses Association (NYSNA), 1199 SEIU, Concerned Physicians of LICH, and patients.

Updated at 3:45 p.m. on March 19 to include information about public forum.

Updated at 6:45 p.m. on March 19 to include comments from SUNY spokesperson David Doyle.

Updated 3/20 to expand a quote by Charlene Nimmons of the Wyckoff Gardens Resident Association.

March 19, 2014 - 5:19am
Latest Revision Time: 
March 20, 2014 - 1:30pm


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