Cobble Hill

Details of the SUNY – LICH hospital deal, unveiled in Brooklyn on Friday

February 22, 2014 By Mary Frost Brooklyn Daily Eagle
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After a year of protests and litigation, details of a settlement opening the way for a new operator for Long Island College Hospital (LICH) were revealed in state Supreme Court in Brooklyn on Friday.

While the agreement does not guarantee that LICH will continue to operate as a hospital, its structure insures that bidders proposing a hospital will jump to the top of the pack in a new RFP (Request for Proposals) process. The RFP could be issued as early as Thursday, lawyers said, assuming approval comes Monday.

(Details of the settlement follow this story.)

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SUNY’s original RFP had been tilted to favor financial considerations, rather than prioritizing the health care needs of the community.

The agreement also gives the coalition that has been working to save the hospital a significant voice in determining which proposal wins the bid – a first in a state RFP.

Still, the deal comes with many uncertainties. If there are no suitable bids by May 22, LICH will close. Already, 241 nurses at LICH have received notices that they could be furloughed on April 10 if no buyer is found, and 1199 SEIU members have also been told of the same possibility.

Attorney Jim Walden, of Gibson, Dunn & Crutcher, representing six community groups, said the agreement represents the community’s “best chance to keep a hospital at LICH.”

Walden added afterwards that he doubted that no hospital proposals would be offered, “given the fact that of the current proposals, there are already one hospital, and one near-hospital.”

All of the parties to the agreement — including SUNY, the state Department of Health, New York State Nurses Association (NYSNA), 1199 SEIU and the community groups – gave up something in the settlement, Walden told state Supreme Court Justice Johnny Lee Baynes.

LICH supporters are dropping three separate legal proceedings against SUNY as part of the deal, two overseen by Justice Baynes and one by state Supreme Court Justice Carolyn Demarest. The Demarest proceeding, currently on hold, has raised questions about the legitimacy of SUNY’s ownership of LICH.

“Once the cloud of litigation is removed from the equation, we believe the prices will only go up, not down,” Walden said.

Justice Baynes, who has been presiding over the case for a year, wanted to make it perfectly clear that LICH supporters, including unions, the community and elected representatives, understood there was no guarantee. “If no operator comes in by May 22, if you do not have a bonafide purchaser by May 22, LICH is going to close. . . . I want people to go into this with their eyes wide open,” he said.

He also said that his work on this case was not over. “I have retained jurisdiction in the case” to insure that “everyone is treated with honor and dignity.”

Jeff Strabone, spokesperson for the Cobble Hill Association, echoed the sentiment that the settlement was the best chance to keep a hospital at LICH. “The previous process favored real estate,” he said. “The new one will favor hospital operators. If respondents want to be competitive, they best propose a hospital if they want a high score.”

He added, “As a process, it is unprecedented that a state-issued RFP is withdrawn, and a new one that the community helped write replaces it. I hope other community groups refer to this in the future when they need empowerment.”

Brooklyn Heights Association Governor Susan Shepard said, “The new RFP changes the parameters dramatically.  We hope that serious hospital operators will give LICH a second look.”

Bill Ringler, President of the Riverside Tenants’ Association, said the yearlong fight to save the hospital “has brought together so many people I never would have met. This has been galvanizing. It’s not over yet – it’s actually another beginning.”

SUNY spokesman David Doyle said the deal would allow SUNY to exit LICH “while also assuring viable health care solutions” for the community. He praised it as the “global solution we worked many months to achieve. This is a win/win.

“We need to exit LICH,” he said. “There’s still a $200 million hole at least that we need to figure out how to pay for – but that’s a discussion we’ll have down the road.”

“This is an uncommon development and a welcome one,” said Arnold & Porter attorney Andrew Bogen.  Bogen and Hanna Fox represent the Concerned Physicians of LICH. Fox added, “We think it is a big deal anytime the real concerns of a community’s citizens are addressed and their legal efforts are vindicated as we feel they have been in this settlement.”

At a press conference following Friday’s legal proceedings, Mayor Bill de Blasio, flanked by representatives of the LICH coalition, Public Advocate Letitia James and other elected officials, called the agreement “a truly historic moment, a transcendent moment for health care in New York City.”

As public advocate, de Blasio was a prominent fighter for LICH, notably getting arrested in the struggle. “There was extraordinary unity and sense of purpose and tremendous sense of fight,” he reminisced. “Literally no one was willing to give up. And when no one is willing to give up, important things happen, big things happen.”

De Blasio did not promise a hospital, but emphasized a sustainable, long term solution at LICH. “Health care is changing,” de Blasio said. “We get it. We are willing to embrace change as long as it is on terms that leaves no New Yorker behind.”

Mayor de Blasio thanked SUNY Chairman H. Carl McCall for “coming to the table and working in good faith,” and Governor Andrew Cuomo for fighting for a Medicaid waiver which will bring close to a billion dollars to Brooklyn to help fund a transition towards primary care, and away from hospitals.

When asked why McCall and Cuomo did not join the press conference, de Blasio said, “We certainly let them know that they would be more than welcome to be here today. I think everyone has busy schedules, obviously, but I think the involvement was very constructive.”

The reisssued RFP reflects many of the criteria described in late January by Public Advocate James and local officials Sen. Daniel Squadron, Assemblywoman Joan Millman, Rep. Nydia Velazquez, and Councilmembers Brad Lander, Steve Levin and Carlos Menchaca. Among other points, the officials had stipulated early on, “Quality and quantity of healthcare services provided must comprise the majority of the competitive criteria.”

 Despite the settlement, Public Advocate James said the work was hardly done. “Hospitals across New York continue to be under duress. We have lost more than a dozen hospitals in the last 10 years. We have to fight for Interfaith in Brooklyn, Saint John’s in Far Rockaway, and North Central in the Bronx.”

Jill Furillo, executive director of NYSNA, praised the unsung heros of the LICH coalition — the nurses and healthcare workers who, despite receiving countless closure and layoff notices, continued to come to work every day at LICH.

Many people told us in the beginning that stopping the closure of LICH was only a pipe dream and that we had absolutely no chance of succeeding. But our movement grew. It grew from one bus full of activists to a whole hospital that was mobilized and ready to fight for care for the entire community and to involve our local and state elected leaders. We have all built this movement together – and together we can say that LICH is open today for care.”

Furillo said that it was because of the unity and tenacity of the LICH coalition “that we have gotten to where we are today. Unity – make no mistake – if we had not fought so hard, had not risked arrest, had not held rallies in the snow and in the heat wave, had not brought our battle into the courtroom, LICH would be closed.”

Even as Furillo was praising the agreement, LICH nurses received word from their NYSNA representative about the possibility of a furlough.

In a question and answer period, de Blasio was asked if he thought hospital operators would jump into the bidding. “There’s been extraordinary interest,” he said. “This is an area of this city that has been booming in every sense, in gaining population, and there was a lot of interest last year. There’s been a lot of interest in recent months. There will be a lot of interest again.”

When asked about his plan to form a Brooklyn Health Authority to coordinate health resources across Brooklyn, de Blasio that the LICH agreement “implicitly moves that agenda forward.

“We want to take additional steps to formalize it now, because . . . once LICH is secured, there’s Interfaith, there’s SUNY Downstate, there’s Brookdale, there’s Wyckoff.”

Council Speaker Melisssa Mark-Veverito said in a statement, “I look forward to working with Governor Cuomo, Mayor de Blasio, members of the community, elected officials and SUNY to quickly select a bidder who will commit to providing comprehensive medical care to New Yorkers.”

Councilmember Steve Levin said, “Local elected officials stood strong with the community, demanding that the request for proposals at LICH be re-opened and that the process be transparent, impartial, and inclusive of the community. It is thanks to the perseverance of everyone who has fought tirelessly for LICH that an agreement has been made and a fair process to discuss the future of health care in our community can begin.”

Councilmember Brad Lander said, “After a year of community activism and advocacy by elected officials, SUNY has agreed to work with our communities to find a solution at LICH that provides quality healthcare for these Brooklyn neighborhoods. This is a positive step, but we must ensure that there is real public input and transparency as this plan is put in motion.”

Council Health Committee Chair Corey Johnson said, “My district is still suffering from the consequences of the closing of St. Vincent’s hospital – a situation that no other neighborhoods should face in our city. I will continue to support the efforts of the elected officials, labor unions and community advocates.”

On Saturday, one of the petitioners expressed anger about dropping the Justice Demarest legal action as part of the deal, fearing that would remove any leverage petitioners have over SUNY. “The Sworn of Damocles position Demarest holds over the entire proceeding is paramount to the saving of LICH,” the stakeholder said. “Withdrawing their actions . . .  allows Williams, McCall and their cronies to be relieved of their criminal activities at LICH.”


Details of the agreement between SUNY and the coalition for LICH:

* A new RFP will be issued with the stated objective of finding an operator who will operate LICH as a full-service hospital.

* The RFP will be open to every qualified respondent, not just the current four bidders.

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

* Medical services will count for 70 percent of the ultimate score; financial considerations will count for 30 percent. (For comparison purposes, SUNY’s current RFP gives 50 percent weighting to the financial category and 40 percent to the medical.)

* 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; at a minimum, SUNY will continue operations for 90 days after the stipulation is finalized.

* Appointees chosen by LICH supporters will make up 49 percent of the technical evaluation committee, and will not sit on the financial committee.

* Bidders are mandated to meet with representatives of the six community groups involved in the lawsuit and Red Hook to get insight about the needs of the community.

* The RFP is attached to the order submitted to state Supreme Court Justice Johnny Lee Baynes, who has been overseeing the case, so there will be “no surprises.”

* The process must be open, transparent and obey Open Meeting laws

* The minimum bid must be $210 million.

* If proceeds of the sale of LICH exceed $240 million (and there are already offers higher than this on the table), 25 percent of the amount over $240 million will go to a non-profit entity chosen by the Public Advocate and the petitioners (those involved in the lawsuit against SUNY).

* Any buildings that will be used by the bidder for medical services will have deed restrictions for 20 years, restricting the property for the use of medical services.

* The RFP process will be “expedited.” SUNY will issue the new RFP three days after the agreement’s final approval (by Justice Baynes, state Supreme Court Justice Carolyn Demarest, who is overseeing another legal proceeding involving SUNY’s ownership of LICH, and other involved entities). That approval is expected sometime next week.

* The bidders will have 15 business days to submit a proposal. Evaluators will have seven business days to consider and rank the proposals.

* SUNY has agreed to “cascading sequences” of consideration. If the criteria are not met by the first ranked bidder, consideration will move to the second, then third.

* The process must wrap up by May 22.

* SUNY will pay Judge Thompson, Justice Bayne’s referee and two ombudsmen $300,000; Gibson, Dunn & Crutcher is waiving $3.5 million in fees.

At the City Hall press conference, Walden added that a determination about funds removed from an endowment funded by the Othmer estate was still up in the air. “When SUNY ultimately wants to make an award, they have to go back before Judge Demarest . . . and then account for what happened to the Othmer money, and whether there’s an obligation to repay. So that’s not going away, that obligation is not going away with the settlement of the litigation, but it will be determined later on.”

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