LICH full-service hospital bids get positive reaction at Brooklyn forum

Big crowd in Brooklyn Heights hears details

March 26, 2014 By Mary Frost Brooklyn Daily Eagle

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A crowd of hundreds packed Founders Hall Auditorium at St. Francis College in Brooklyn Heights Tuesday night to hear details about nine proposals for Long Island College Hospital (LICH).

A panel of doctors, architects, legal and community leaders discussed each bid and answered questions as well as possible, considering that most of the proposals are hundreds of pages long and several have hundreds of pages of information redacted.

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Update: Big questions about inappropriate influence. Are LICH supporters headed back to court?

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While panelists did not endorse any one particular bid, all agreed that only proposals which would operate LICH as a full-service hospital would satisfy the healthcare needs of the community. Those proposing only urgent care centers and freestanding ERs were dismissed as inadequate.

“Four hospital teams share our point of view that LICH is economically viable,” said Jeff Strabone, spokesperson for the Cobble Hill Association. “You’d have to be incompetent to run a hospital at this site into the ground, they told us.

Panels composed of state officials and one of representatives chosen by community groups submitted their votes on Wednesday at 3 p.m. The SUNY board of trustees will be formally briefed on April 3. At the latest, SUNY will announce the winning proposal on April 4.

The bid that receives the highest score will be awarded the initial opportunity to start negotiations to buy LICH from SUNY. If SUNY and the initial winner are unable to come to terms within 30 days, then SUNY may terminate the negotiations and start talks with the bidder who came in second, and so on.

Debunking a story in the Times

Attorney Jim Walden of Gibson, Dunn & Crutcher wasted no time debunking a story that appeared in Monday’s New York Times, which claimed the winning LICH proposal would have little chance of getting an operating license from the state Department of Health because the health commissioner and Gov. Andrew M. Cuomo have said repeatedly that “there are already too many hospital beds in Brooklyn.”

“Let me be clear about this,” Walden said. “The Department of Health said it will authorize an article 2806 temporary operating certificate” for the winning operator and “expedite other necessary permits,” as part of the legal settlement between the LICH petitioners and SUNY.

Walden also pointed out that SUNY itself said LICH was indispensable to northwestern Brooklyn. “When SUNY took over LICH, they signed an affidavit saying this part of Brooklyn was deficient in hospital beds.” He added, “It’s in writing and under oath. In 2011, SUNY filed court a statement of need saying if the hospital [LICH] went under, Brooklyn would be in chaos.” Walden represents six community groups and the public advocate’s office in the LICH litigation.

The panel included moderator Tony Lewis, CEO of the Cobble Hill Health Center; Jeff Strabone, spokesperson for the Cobble Hill Association; attorney Jim Walden of Gibson, Dunn & Crutcher.; Jane McGroarty, architect and chair of the Brooklyn Heights Association’s LICH committee; Laurie Maurer, Fellow, American Institute of Architecture; Dr. Toomas Sorra, president of Concerned Physicians of LICH; and Dr. Douglas Sepkowitz, chief of infectious diseases at LICH.

A resolution in favor of “one of the hospital proposals over the ‘free-standing emergency department’ proposals, which will not meet our needs for acute care” was read by Brooklyn Heights resident Susan Raboy, and approved by what appeared to be an unanimous show of hands. (Full resolution below.)

Four of the bids under consideration call for full service hospitals, some more elaborate and with greater construction times than others. These include proposals from Brooklyn Health Partners, the Chinese Community Accountable Care Organization, Prime Healthcare Foundation, and Trindade Value Partners. (See below for brief descriptions of each proposal. The full proposals can be found at http://www.suny.edu/hospitals/downstate/newrfp/)

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Miss the forum? Watch the videos

Part 1

Part 2

Part 3

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Panel comments:

While some questions were voiced by the architects on the panel about the amount of development involved in the Chinese Community Accountable Care Organization proposal, members found many things to like. The doctors on the panel said they found the plan to be viable, and noted that during the first round of bidding, the group was the only one who proposed a hospital. “They’re serious,” said one. Another strength of the proposal is its partnership with St. George’s University School of Medicine in Granada. Students from St. George’s would train at LICH, doctors said. None of the other proposals have current affiliations with teaching programs. It was also noted that the group was successful in cost reduction techniques in the wake of Obamacare.

Also proposal getting positive reactions was Prime Healthcare Foundation, a group that already runs 23 hospitals. One doctor got a “good feel” from the group. While being looked at for “optimizing reimbursement” in their insurance coding, the legal and community members felt that all groups of this size incur government scrutiny, and if they can keep hospitals in operation, “More power to them.” The architects said they “actually run hospitals,” while some of the other groups were “developers dragging along hospitals.”

It was noted that Brooklyn Health Partner’s plan for a 300-400 bed full-service hospital calls for “a large scale community development zone” for the hospital portion, which drew concern from the architects on the panel. Doctors worried that continuity of service would be lost during a long construction period. It was pointed out that this plan is favored by Wyckoff Gardens Association and a Red Hook group.

The panel commented that a plan from Trindade Value Partners had “the most admitted bulk by far.” The architects called the towers “unbelievable for our neighborhood,” and “this one has never heard of the word context.” It was also noted that “They came out of left field,” and there were questions about the backers that remained unanswered. One panelist gave them credit, however, for “thinking outside the box.”

A proposal by the Chetrit Group to build a “quasi-hospital” vanilla box for long-term acute care, as opposed to a full-service hospital, was largely dismissed for not satisfying the needs of the community and for duplicating nursing home services already in the neighborhood. Architects also criticized their lack of due diligence. The plans call for taking over a park that has a 99-year lease.

The four plans that don’t include full-service hospitals, below, were seen as out of touch with the RFP process and the community.

A plan by The Brooklyn Hospital Center and Related Companies for an ER, urgent care centers and clinics was booed by the attendees. “This is not a hospital, it’s significantly less,” said attorney Walden. “If a person has a heart attack, stroke or an emergency in pregnancy, this place is not going to help them.” He added, “I don’t care if Mohammed on a mountain comes down, it doesn’t meet our needs.” The architects noted the “meager” information about development. Almost half of the proposal has been redacted.

A similar offering by Fortis Property Group was criticized for its lack of hospital offerings — only four observation beds — and for “not having a clue” about the current uses of the hospital buildings. Jeff Strabone commented, “NYU is proposing four beds. If you get into a car accident with five people, one person is out of luck.” Others commented on the developers’ “inability to engage proactively.” Architects noted that the plan was unique in using the current R6 zoning.

Very little comment was made about the LANA group, other than zoning would need approval.

A plan by the Peebles Corporation was also criticized for not offering a hospital. Though reputable medical groups including Maimonides Medical Center and North Shore-LIJ are involved, their involvement was seen as a way to drive traffic to their actual hospitals, rather than benefitting the LICH area. (This comment was also made about The Brooklyn Hospital Center plan.) Peebles revealed their offer to be $260 million, a figure that had been redacted on SUNY website.

Several attendees asked if any of the proposals planned to return LICH’s psychiatric unit. “The mental health component is crucial,” commented Brooklyn Heights resident Martha Rimler. “We had 42 beds full every night,” one nurse said.

Dr. Sepkowitz said the unit was just a fraction of “all that was destroyed by SUNY.”

“We had a great cardiac unit – It was destroyed. We had the first stroke unit. It was destroyed. We had the best neurosurgery unit in Brooklyn. It was destroyed. A lot of stuff was destroyed last year, and a lot of stuff continues to be destroyed,” he said.

Others questioned how closely the financial backing of the bidding teams was being vetted.

“That’s a valid concern,” said Walden, who said that financial information about one of the teams proposing a hospital was hard to confirm. “The finance committee will have more information available,” he suggested.

City Councilman Brad Lander, attending as an observer, said that zoning issues could be a sticking point with several of the proposals. Describing the long ULURP (Uniform Land Use Review Procedure) process, Lander said “the vague, unspecific way the RFP process relates to rezoning” was “frustrating.” He suggested it would have been better to have proposers come up with two plans, one involving rezoning and one not.

The forum was sponsored by the six community groups who have been working together with unions, doctors and patients to keep LICH in operation as a full service hospital. These include the Boerum Hill Association, Brooklyn Heights Association, Cobble Hill Association, Riverside Tenants Association, Carroll Gardens Neighborhood Association and Wyckoff Gardens Association, Inc.

All nine proposals were made public by the State University of New York (SUNY) last Friday night.

Walden explained that 70 percent of the final score is based on “technical” considerations, which relate to medical offerings, and 30 percent is based on financial considerations. Representatives of the pro-LICH litigants have 49 percent of the technical vote, and none of the financial vote.

“Any proposal not offering an acute care facility with beds must receive a technical deduction,” Walden said. Proposals offering a full-service hospital, teaching hospital and continuous care with no gap in service receive an enhanced score.

“All this is happening in good faith that SUNY is operating under the letter and spirit” of the settlement, Walden said. As a fail-safe, the court retains its jurisdiction. “If we can show SUNY violates the letter and the spirit of the agreement, we can get relief, and in the worst case scenario, resume litigation.”

While the bidding teams had originally been expected to speak at the forum, they were informed Monday by SUNY that doing so might disqualify them from the state’s Request for Proposals (RFP) process.

The entire proceeds have been videotaped and will appear online soon. Please check back; this article will be updated.

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Community resolution ratified at the forum:

Whereas, This community needs a hospital

Whereas, this Community has fought in court to keep a hospital

Whereas, the Settlement secured by this Community in our court case gives a guaranteed higher technical ranking to a hospital

Whereas, the Settlement secured by this community has produced a number of proposals from operators of a hospital, which will ensure acute care for our community

Therefore, be it resolved by the thousands of residents of Southern and Western Brooklyn, as represented by those in attendance, that we favor one of the hospital proposals over the “free-standing emergency department” proposals, which will not meet our needs for acute care

Be it further resolved by the thousands of residents of Southern and Western Brooklyn, as represented by those in attendance, that we need a full-service hospital and we are united in our goal to make it succeed.

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Brief summaries of nine proposals:

– Brooklyn Health Partners

Brooklyn Health Partners proposes to build a new 300-400 bed full-service hospital in the Fuller and Othmer Pavilions and medical offices in the Polhemus building and part of the Amity Pavilion. It would create a “medical district” in the surrounding sites with medical offices, residential and commercial development. Construction would begin 24 – 36 months after closing. The hospital would be operated by Quorum Health Resources. A “bridge facility” would open immediately, which would include a 100-bed hospital with ER, ambulatory care, ICU and more. The proposal includes 1,000 units residential development, 30 percent affordable. They will seek to rezone the non-core properties. The temporary facility would employ 300 staff; the completed project will employ 2,000-plus. After 20 – 30 years, title to medical properties would be transferred to the community. Purchase price: $250 million.

– Chinese Community Accountable Care Organization

Chinese Community Accountable Care Organization with Eastern Chinese American Physicians, Paladin Healthcare Capital and Stanton Road Capital proposes to partner with St. George’s University School of Medicine (a teaching hospital in Grenada) for a full-service teaching hospital starting with 150 beds, then adding 50 beds a year up to 250 beds, including ICU, labor and delivery units. A proton therapy center owned by Bioscience Capital is also under consideration. A transitional management team will operate LICH while a permanent team is assembled. The hospital will be located in the Othmer and Polak Pavilions and the Henry Street Building. A strong emphasis will be placed on lowering cost and concentrating on primary care and prevention. Full implementation is expected to take 19 – 24 months. Stanton Road Capital will be backing the project, which envisions a combination of medical, commercial, retail and residential development. Purchase price $210 million.

– Prime Healthcare Foundation

Prime Healthcare Foundation proposes a non-profit full-service hospital starting with 100 beds then growing to 200 or more. The hospital would open immediately in the existing core properties: the Fuller Pavilion, Othmer Pavilion, Henry Street Building and Polak Pavilion. They propose to immediately resume all comprehensive and emergency services, including primary and specialty care, reopen the 16 operating rooms, resume residency programs, and invest in new equipment and physical and information infrastructure. They would employ all LICH employees and independent medical staff and maintain charitable programs. They would eventually use the 16 non-core properties for “unknown/ real estate” purposes. Purchase price: $220 million.

– Trindade Value Partners

Trindade Value Partners proposes a new full-service hospital with 506 beds. This includes a 400-bed medical surgical hospital and a 106-bed women’s hospital. The proposal also includes a comprehensive cancer center, a new ambulatory care center and medical office space. They will integrate hospital care with community-based care. A bridge/transition facility would include a 60- to 80-bed hospital with an emergency department, ICU, surgical and other services to be located in the Polak Pavilion for two years, then into the newly-constructed women’s hospital for a three-year period. A third phase would move these and additional services into the newly constructed medical-surgical hospital. Construction will take five phases over a nine-year period and will involve rezoning for residential development that will include 25 percent affordable housing. The plans include a new park on Henry Street. IDEEN Pharmaceuticals of Brazil is capitalizing the transaction. Purchase price: $210 million.

Intermediate Hospital Proposal:

– The Chetrit Group

The Chetrit Group would build a “vanilla box” hospital space but would leave it to the state government and the community to find an operator. They envision 100 total beds, a full-service 15-bay ER and a 12-bed ICU set in the Polak Pavilion. The 66 hospital beds would be intended for long-term acute care patients needing services in between those delivered at a full-service hospital and those provided by a nursing home/ rehab center. Chetrit would lease the health space at a below-market rate of $20 per sq. ft. to the eventual service provider. The proposal includes residential development with 30 percent affordable housing. They will seek rezoning. Purchase price: Either $251 million outright, or $226 million plus the deed of the Polak Pavilion to the eventual health care provider for $1.

Non-hospital Proposals:

– The Brooklyn Hospital Center

The Brooklyn Hospital Center (TBHC) would partner with Mount Sinai Medical Center for outpatient services, physician offices and a freestanding ER with 15 bays and up to 10 observational beds at the LICH site. They also propose two urgent care centers, locations to be decided, and two new walk-in facilities in Red Hook and Gowanus. Urgent care centers would be operational within 12 months. TBHC plans to invest $75 million towards community based healthcare, location not specified. Centers would employ 225 staff. LICH campus would be sold to Related companies, outpatient/ ER site would be leased to TBHC. Related plans mixed development. Purchase price: $212 million.

– Fortis Property Group

Fortis Property Group proposes to purchase the LICH campus and lease a portion to NYU Langone Medical Center for urgent care services, a cancer care center and a freestanding basic care ER with four observational beds. The ER would be located in the Polak Pavilion. Lutheran HealthCare would provide clinical services in the LICH service area. An ambulance would be stationed at the ER site to transfer serious cases to a hospital. Fortis would donate $5 million towards community health care. Fortis plans rental, condo and town home development, with 25 percent affordable. No new zoning is anticipated. Purchase price: $240 million.

– LANA Acquisitions

LANA Acquisitions proposes an urgent care center and freestanding ER with a broad range of primary and specialty care services, to be located in the Polak Pavilion. They also propose a dialysis center, mental health clinic and more. The remaining area of the Polak Pavilion would house a 150 – 200-bed nursing home. LANA is considering locating assisted living services in another LICH building. They intend to use the 91 – 95 Pacific Street structure for a public school. The remaining buildings would be used for real estate development. Purchase price: $230 million.

– Peebles Corporation

Peebles Corporation proposes to partner with North Shore-LIJ, Maimonides Medical Center and ProHEALTH physician practice to provide a freestanding ER, urgent care, ambulatory surgery and specialty services in 90,000 sq. ft.. The Institute for Family Health would operate a health center in Red Hook or Gowanus. Transition: existing ER in Polak Pavilion would offer urgent care until facilities could be developed in Othmer Pavilion. Patients needing a hospital would go to Maimonides or other hospitals. Peebles would set aside $7.5 million to develop new jobs outside of the hospital. The LICH properties would be developed as mix-use. Purchase price: $260 million.