Brooklyn judge orders SUNY to give Long Island College Hospital back to Continuum

Invites other potential operators to a conference

August 20, 2013 By Mary Frost Brooklyn Daily Eagle

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Shock, amazement, relief and confusion greeted the blockbuster announcement on Tuesday that Brooklyn Supreme Court Justice Carolyn Demarest has ruled that SUNY Downstate must give Long Island College Hospital (LICH) back to Continuum Health Partners, or to another operator if Continuum isn’t able or willing to take it back.

Continuum issued a statement late Tuesday saying it isn’t able to take the hospital back, according to AP.

SUNY Downstate took over LICH, a 155-year-old hospital in Cobble Hill, two years ago from Continuum under an arrangement signed off on by Justice Demarest, and has been trying to shut LICH down since February.

Residents, hospital staff and unions, Public Advocate Bill de Blasio and a number of civic groups have been battling in the courts and in countless rallies and marches to block what they called SUNY’s plan to sell off LICH’s valuable assets, said to be worth a half a billion dollars.

For many, Justice Demarest’s order was a bolt out of the blue, since the bulk of the legal battles have been fought over the last few months in Supreme Justice Johnny L. Baynes’ courtroom. Justice Baynes, after a remarkable three-day hearing two weeks ago, ordered SUNY Downstate to keep LICH partially open until an agreement could be reached about its operation, possibly under another operator.

In late June, however, Justice Demarest, after reading about “the demise of Long Island College Hospital (LICH) at the hands of the State University of New York (SUNY Downstate)” became “increasing concerned as to the propriety of my own order granting approval of the transfer of LICH’s assets to SUNY Downstate in light of Downstate’s apparent lack of stewardship over those assets in advancement of LICH’s charitable purpose.” Justice Demarest ordered SUNY Downstate to present a full accounting by August 5 of all LICH property, assets and funds transferred to Downstate.

Based on that accounting, and after a visit to LICH she made personally where she saw the hospital refuse to treat people in need of medical care, Justice Demarest determined “that I have a legal and moral responsibility to correct my earlier error.”

Justice Demarest plans to hold a conference on August 22 at 10 a.m. to address the “orderly and expeditious return of assets to LICH and the future operation of LICH as a hospital.” Any person or entity with a proposal for operating LICH as a hospital is invited to attend.

While details are still up in the air, LICH supporters are cautiously taking the decision as a big step forward.

“This win belongs to LICH RNs, staff, doctors, neighbors and community associates, Councilmen Levin, Lander, Senator Sqaudron, Assemblywoman Millman, the Redhook Star and the Brooklyn Eagle,” said Julie Semente, critical-care nurse at LICH and a member of the New York State Nurses Association. “Our relentless actions from January to June fighting the injustice that SUNY was perpetrating on LICH, and the superb, accurate reporting of these two local newspapers keeping SUNY’s LICH scandal in the news every day, caught Judge Demarest’s attention and caused her to revisit her 2011 decision.”

Semente also expressed gratitude to the court system. “As jaded New Yorkers who have witnessed the power of well-connected Albany insiders, especially in the past eight months, we did not expect there could be justice for LICH. We are extremely pleasantly surprised and there is celebration at LICH today, with much gratitude and admiration for Judge Demarest, and appreciation for her integrity. The nurses, doctors, and staff at LICH, along with our neighbors, community associates and local elected officials fought so hard for so long because what SUNY was doing to LICH was wrong. As Judge Demarest has just shown, the Truth matters.”

“This order validates our suspicion that SUNY took over LICH with the intention of profiting off of the real estate – valued at up to $1 billion dollars,” said Jill Furillo, executive director of the New York State Nurses Association. “Real estate profits must not be put before the healthcare needs of an entire community. We hope that this order will take us one step closer to our goal of keeping LICH open for care and letting profiteers know that we will not let them close any our hospitals – not LICH, not Interfaith, not any New York hospital.”

A spokesperson for Public Advocate Bill de Blasio, who has been deeply involved in the fight to keep LICH and other threatened hospitals in Brooklyn open, did not want to comment until he had read the court decision.

City Council Member Letitia James said, “Today, a court found in favor of healthcare and saw the importance to preserve and protect New Yorkers who may find the need for their neighborhood hospital. I thank Judge Demarest for her diligent work and reversing her original order. Neither Justice Demarest nor supporters of LICH were fooled by the deception of involved parties, whose only interest was to transfer assets and close down LICH so they can make a quick buck by building luxury housing.”

City Council Member Stephen Levin said, “The communities of Brooklyn desperately need the care that Long Island College Hospital provides. SUNY has shown time and again that they have no desire to keep LICH open and have illegally attempted to shut down the hospital, already creating ripple effects throughout the Brooklyn health care system. It is time for SUNY to go and for Long Island College Hospital to have a new operator.”

State Sen. Daniel Squadron said, “LICH is vital to Brooklyn and simply cannot be turned into a massive real estate deal that would leave patients in our community and around Brooklyn without the health care they need. Today’s ruling is further confirmation that we must keep LICH open until a new operator is in place. There are solutions to preserve LICH and they must not be left on the table. This ruling provides an opportunity to reach a solution and prevent SUNY from simultaneously shutting down vital services.”

In her scathing eight-page decision and order, Justice Demarest wrote that the original rationale behind the transfer of LICH to SUNY Downstate two years ago “was the representation that LICH would be preserved as a hospital serving the people of Brooklyn.

“Recent events have established that the consideration, which the Court found to be fair and reasonable in the circumstances, has failed, possibly by design, and that this Court, and many of the other interested parties, may have been deliberately misled at the time the transfer was approved,” she wrote.

Closing LICH is in “clear violation of [SUNY’s] commitment,” she wrote. Justice Demarest also said that had she known about SUNY Downstate’s dire financial condition at the time it took over LICH, “the petition would not have been granted.”

The order also says that SUNY may have misrepresented the amount of losses they’ve sustained related to LICH operations, and that at the time SUNY took over LICH assets they claimed that they were prepared to sustain these losses. “SUNY Downstate’s actual losses attributable to LICH approximate $30 million dollars at this time,” Justice Demarest wrote. “Moreover, LICH’s Liability Fund is actually in very good financial condition, to the extent that SUNY has sought to cover its own financial difficulties by accessing LICH’s retained assets.”

SUNY Downstate spokesperson Robert Bellafiore said in a statement, “Today’s court order directs ownership and operation of Long Island College Hospital back to Continuum Health Partners. SUNY has made clear it is exiting LICH so it can stabilize Downstate and today’s judgment is another move in that direction.

“The facts are that when SUNY acquired Long Island College Hospital it was done with the best of intentions; save a hospital that was on the verge of closure, grow the struggling Downstate enterprise as a strategy to survive, and provide additional clinical training opportunities for our students. SUNY has poured millions of dollars into LICH in an attempt to reverse nearly two decades of financial losses. Unfortunately, SUNY and LICH became victims of the daunting realities of Brooklyn’s health care delivery landscape. We are disappointed it did not work, but it was not for lack of effort,” Bellafiore said.

Saying it was unfair “to ask our students and campuses across the State to cover significant costs associated with a failing hospital,” Ballafiore said that SUNY must exit LICH “as part of a much broader plan to restructure Downstate so vital medical education and high quality care at UHB [University Hospital of Brooklyn] can continue.”

Updated with more comments at 6:15 p.m.