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Storm swirls around LICH bidder in Brooklyn, days before May 5 deadline

Mayor Bill de Blasio at a rally for LICH in October 2013, when he was Public Advocate. Photo: Mary Frost

De Blasio voices concern; BHP under gag order

Brooklyn Daily Eagle

The group negotiating to take over Brooklyn’s embattled Long Island College Hospital (LICH) from the State University of New York may have won the bidding war, but now they find themselves embroiled in a war of public perception.

If negotiations with SUNY are successful, on May 5 Brooklyn Health Partners (BHP), a California-based group, will plunk down a non-refundable $25 million deposit and move on to the next stage of approvals necessary to operate a hospital at the LICH site.

But an onslaught of negative articles about BHP’s viability and alleged plans to build 50-story towers, skepticism about SUNY’s bidding process, and an expression of doubt from none other than Mayor Bill de Blasio has BHP’s partners shaking their heads.

On Monday the Mayor’s spokesperson Phil Walzak said in a statement, “As we learn more, there are some real concerns being raised about the bid by BHP.  Our first, and only, responsibility is the preservation of quality, uninterrupted health care services at the LICH site. If BHP cannot achieve that, then the community, SUNY and other stakeholders must look elsewhere for the best proposal.  

Walzak added, “Any bid that fails to achieve our most critical goal should be passed over in favor of a plan that makes good on that promise to the people of these communities.”

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UPDATE: On Wednesday Mayor de Blasio called on SUNY to drop negotiations with BHP

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BHP spokesperson Donnette Dunbar said the group was taken aback by the criticism, since good faith negotiations are ongoing.

“Brooklyn Health Partners is surprised that the mayor has taken that position seeing he has not been a part of our negotiations with the State University of New York,” she told the Eagle.

“On May 5, BHP will make a $25 million non-refundable payment and show it has the financial means to complete the entire project,” she said. “We would hope that the mayor and other stakeholders would judge BHP, not on unsubstantiated rumors, but on its performance.”

Attorney Jim Walden of Gibson, Dunn & Crutcher, representing the Public Advocate and community groups who have been fighting to keep LICH open, said on Tuesday, “We are hopeful discussions between SUNY and BHP will succeed. We continue to monitor the situation, and are in discussions with our coalition partners and elected officials about options depending on the events over the next few important days."

Susan Raboy, spokesperson for the advocacy group Patients for LICH, parsed the Mayor’s statement. “Our mayor is right on target when he says ‘our first, and only, responsibility is the preservation of quality, uninterrupted health care services at the LICH site.’  I would add the necessity for a smooth and transparent transition process from SUNY to the new operator.”

But she also expressed misgivings about the voting process. According to the legal settlement, panelists were supposed to give more points to proposals offering to maintain LICH as a full service hospital.

SUNY evaluators, on average, gave more points to non-hospital proposals than they did to hospital proposals. In one glaring case, SUNY “evaluator #9” awarded 0 points to all full-service hospital bids, and 70 points, the maximum allowed, to developer Fortis Property Group.

A non-hospital developer, investor Don Peebles, came in second overall. If negotiations with the winning bidder fall through, SUNY will begin negotiating with Peebles as the second-place finisher.

Dr. Jon Berall, who acted as a court-appointed ombudsman at LICH during the litigation, asked, “How could Fortis and Peebles rank higher than CCACO [Chinese Community Accountable Care Organization] and the other hospital bids? And significantly higher? If honestly done?”

“My concern is the voting process and whether or not the same instructions were given to both  panels,” Raboy said. “If the two panels received different instructions with different areas of emphasis the entire process is flawed.”

DOH Approves LICH Closure Plan

SUNY issued letters to patients this week informing them that LICH will stop admissions, end dialysis, close the maternity department and begin ambulance diversion on May 12, and that the hospital will be shut completely on May 22. Hundreds of LICH staffers have already been laid off.

“How is stopping admissions and closing units on May 12 not a violation of the order that requires them to continue current services until May 22?” a long-time LICH nurse asked. Patients said that they had already had to wait many hours, or even overnight, to be admitted to Brooklyn Hospital Center and NY Methodist.

State Department of Health spokesperson Bill Schwarz, in response to the Eagle’s request for LICH’s closure plan, issued this statement:

"The New York State Department of Health’s highest priority is the safety and well-being of Long Island College Hospital patients. Following a comprehensive review of SUNY’s closure plan, DOH has determined it achieves an orderly and safe closure, ensures patients’ continuity of services at other facilities in the community, and is consistent with the terms of the February 25, 2014 Settlement Stipulation and Order.”

About BHP obtaining a temporary operating license, Schwarz said, “To date, DOH has not received any documents or applications from BHP and therefore cannot comment further."

At Sen. Daniel Squadron’s annual Convention on Sunday, Brooklyn residents asked the Senator to help BHP obtain a temporary operating license.

“Recent reports concerning BHP -- including continuity of healthcare services, development plans, and long-term viability -- and the scoring process are troubling," Senator Squadron said on Wednesday. "SUNY should work with all parties to collaboratively ensure we meet our goal of a stable, appropriate solution for the LICH site and healthcare in our community."

Trindade Files a Protest

Trindade Value Partners, a group once affiliated with BHP, has filed a protest with SUNY about both the bidding process and BHP. Trindade came in sixth in the vote, even though they say their their hospital plan, jointly developed with BHP, was essentially identical to BHP’s. “Trindade and BHP worked to produce a joint proposal until March 14, 2014,” when the parties split, writes Derek Oubre, president of Trindade.

Oubre says he is distantly related to the head of BHP, Merrell G. Schexnydre, but is not closely connected. Schexnydre, from California, used Oubre’s Westchester address on an application related to the RFP.

Oubre provided copies of emails from healthcare architect James Crispino, president of Francis Cauffman, putting the cost of a new, “21st Century” hospital at $800 million to $1.1 billion. Oubre says BHP lowballed their estimate in their proposal, leaving out “soft costs” like beds, gas, and hospital equipment.

He also charged that both BHP and Prime Healthcare, which also proposed a hospital, “omitted critical non-financial data,” such as lawsuits and investigations, in Prime’s case, and lack of financial backing, in BHP’s case -- and that SUNY should have been aware of these inconsistencies.

Oubre provided emails discussing 50-story towers at the site, and in his protest to SUNY, hinted at a “backdoor deal” with Don Peebles, though no documentation was provided to back this up.

“There is no rational reason why the proposal set forth by Don Peebles should receive such a high score,” he said. “Non-full-service proposals should receive a score lower than full-service proposals -- full stop.”

Donnette Dunbar, spokesperson for BHP, told the Brooklyn Eagle last Friday, “Various reports that Brooklyn Health Partners (BHP) has made land use decisions concerning the Long Island College Hospital campus are absolutely false."

But more than that, they can't say. Dunbar said that they are still operating under the RFP’s  gag order “until the contract between the SUNY and BHP is executed and approved.”

Until that process is completed, BHP cannot schedule a meeting with the community to discuss details about transitional health services at LICH or answer questions.

Community groups who were party to the litigation are also holding their tongues, for the most part. But that will change if the deal doesn't work out, they say.

April 30, 2014 - 4:44pm


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