NEWARK – Feb. 4, 2016 – Saint Michael’s Medical Center in Newark cleared a significant hurdle
today after the State Health Planning Board signed off on a recommendation
to approve the hospital’s sale to Prime Healthcare Services.
After a hearing at the Department of Health in Ewing, the board voted to
accept the recommendation from the state Department of Health staff to
approve Saint Michael’s application for a Certificate of Need to
transfer of ownership to Prime.
The recommendation now goes to Acting State Health Commissioner Cathleen
D. Bennett, who has up to 120 days to render a decision.
“We still have several steps ahead of us before the sale to Prime
is completed, but are encouraged by this latest development and hope that
Commissioner Bennett will render her decision quickly,” said Saint
Michael’s President & CEO David Ricci.
The Health Planning Board’s sign off comes nearly three years after
Saint Michael’s applied to the state for the Certificate of Need
to transfer ownership to Prime and to the state Attorney General’s
Office under the Community Health Care Assets Protection Act.
Since the applications were filed, Saint Michael’s voluntarily filed
in August for reorganization under Chapter 11, an action Prime agreed
was necessary to preserve the medical center’s financial viability
following the protracted application process.
As part of the reorganization process, other interested parties were invited
to bid on the hospital. Prime emerged as the winning bidder with a $62
million offer. In addition, Prime agreed to double the amount of money
it plans to invest in upgrading and modernizing the hospital to $50 million.
As part of its initial offer, Prime has agreed to keep the hospital over
the next five years, hire substantially all 1,400 hospital employees,
maintain or increase current levels of charity care, and maintain existing
health insurance contracts.
“We are grateful to the State Health Planning Board for recommending
approval of our purchase of Saint Michael’s Medical Center, as well
as to the staff of the Department of Health and Attorney General’s
office for their thorough review and due diligence throughout the approval
process,” said Luis Leon, President of Operations of Prime Healthcare Services.
“Prime Healthcare is committed to preserving and expanding high quality
healthcare resources, particularly in underserved communities" Leon
said. "We look forward to welcoming the physicians, nurses and employees
at Saint Michael’s to our growing Prime family in New Jersey and
working with to continue Saint Michael’s more than 150-year legacy
of service to the greater Newark community.”
The sale of Saint Michael’s to Prime has widespread support in the
community. At a hearing on Dec. 15 before the State Health Planning Board
at New Jersey Institute of Technology in Newark, 33 people testified,
all in favor of the sale of Saint Michael's to Prime. Those who testified
included patients, employees, doctors, nurses, union representatives,
clergy, members of the community and elected officials, including state
Assemblyman Tom Giblin, Essex County Freeholder President Britnee Timberlake
and members of the Newark City Council, which had unanimously passed a
resolution earlier last year supporting the sale.
Central Ward Councilwoman Gayle Chaneyfield Jenkins, who has been leading
the community effort to save the hospital, testified today that sale of
Saint Michael’s to Prime will have a positive impact on the community
“The Board’s action today will save 1,400 jobs in Newark, preserve
competition so our residents have a choice of health care providers and
put $50 million of private investment into the heart the city,”
Chaneyfield Jenkins said. “No matter how you look at it, this is
a win for Newark.”
About Saint Michael’s Medical Center
Established by the Franciscan Sisters of the Poor in 1867, Saint Michael’s
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 a member of Trinity Health. Learn more at
About Prime Healthcare Services
Prime Healthcare Services is an award-winning national hospital system
with 42 acute-care hospitals providing nearly 42,000 jobs in 14 states.
Eleven of the hospitals are members of the Prime Healthcare Foundation,
a 501(c)3 public charity. The mission of the Prime Healthcare Foundation
is to provide quality, compassionate healthcare for all, and serve communities
through various charitable and educational initiatives. Based in California
and one of the largest hospital systems in the country, Prime Healthcare
is committed to ensuring access to quality healthcare. It has been recognized
as among the “100 Top Hospitals” in the nation 33 times and
among the “15 Top Health Systems” three times, and is the
only "10 Top Health System" west of the Mississippi. Numerous
hospitals have been recognized by The Joint Commission as among the "Top
Performers on Key Quality Measures" in 2015. For more information,