Saint Michael's Medical Center Releases Response to Navigant Study
Response states report would create "unregulated monopoly in inpatient hospital services in the Newark area"
20 Apr, 2015, 08:30 ET
NEWARK, N.J., April 20, 2015 /PRNewswire/ -- Saint Michael's Medical Center released its response to a report by Navigant Consulting recommending the consolidation and closing of healthcare facilities in Newark.
Saint Michael's concludes that the Navigant recommendations would create a monopoly in inpatient hospital services in the Newark area, potentially causing price increases amounting to as much as $180 million annually. Additionally, the recommendations would cost at least 1,000 jobs, and expose New Jersey taxpayers to $50 million in additional obligations.
"We believe that the Navigant recommendations are bad for Newark, bad for New Jersey and especially bad for healthcare consumers," said David A. Ricci, President and CEO of Saint Michael's. "Monopolies harm the public and the Navigant recommendations, if enacted, would create a monopoly."
The Saint Michael's response cites economic research that shows that consolidating facilities and eliminating competition substantially increases prices to consumers. The economic research also shows that higher quality results not from consolidation, as recommended by the Navigant report, but from competition.
Saint Michael's response calls for the state to promptly approve the proposed acquisition of Saint Michael's by Prime Healthcare. Prime plans to invest more than $25 million into Saint Michael's facility, and to preserve the mission of the hospital. Prime has an outstanding track record across the United States of acquiring and reviving financially challenged hospitals.
"The Prime acquisition will allow Saint Michael's to continue serving the people of the greater Newark area, and will preserve more than 1,400 jobs," Ricci said. "After more than two years, it is time for the state to approve the acquisition, and let us move forward to improve healthcare in Newark."
The Saint Michael's response was authored by David Ettinger, an antitrust lawyer who has worked in the healthcare field for more than 35 years. Ettinger has advised clients on hospital mergers and consolidations, and addressed those transactions in litigation and government investigations, in 18 different states, involving more than 30 different transactions.
About Saint Michael's Medical Center
Established by the Franciscan Sisters of the Poor in 1867, Saint Michael's Medical Center is a 357-bed regional tertiary-care, teaching, and research center in the heart of Newark's business and educational district. Saint Michael's Medical Center is currently a member of Trinity Health. More information is available at www.smmcnj.org.
About Prime Healthcare
Prime Healthcare is an award-winning national hospital system with 34 acute-care hospitals providing more than 35,000 jobs in 11 states. Based in California and one of the largest hospital systems in the country, Prime Healthcare is committed to ensuring access to quality healthcare. More information is available at www.primehealthcare.com.
SOURCE Saint Michael’s Medical Center
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