Two NYU Hospitals May Split; One is in Talks with Columbia

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In another potential health-care divorce, NYU Medical Center and NYU Downtown Hospital are said to be on the brink of a breakup.


Though neither hospital spoke on the record, sources at both institutions said talks about a split, which have been on the table for sometime, have accelerated. NYU Downtown is also said to be in discussions with other academic hospital networks, including New York-Presbyterian, the academic giant of Columbia University and Cornell University, about forging a new affiliation.


When asked whether the hospital had talked to NYU Downtown about a partnership or affiliation, a spokeswoman for New York-Presbyterian, Myrna Manners, said: “We’ve had discussions with them, but nothing has been finalized and there are no plans in motion. They are only discussions.”


She then added, “We regularly have discussions with hospitals about different things.”


Sources who did not want to be named said the dean of the NYU School of Medicine, Robert Glickman, spoke of the split-up at a September 23 meeting.


Dr. Glickman did not return calls from The New York Sun. But one doctor, comparing him to the chairman of the Federal Reserve Board, Alan Greenspan, observed: “He doesn’t say something unless there is significance to it.”


Though plans are not final and the possibility that the two New York University institutions will patch up their relationship cannot be ruled out, the marriage between the facilities was not one made in heaven.


The two hospitals have been affiliated since 1998, when the smaller one was renamed NYU Downtown from New York Infirmary-Beekman Downtown Hospital. Until 1991, when it merged with the New York Infirmary, the facility was known simply as Beekman Downtown.


Even before the NYU affiliation, the downtown facility was financially struggling. In 1991 it was classified by the state as a “financially distressed” hospital because of its large population of Medicaid and uninsured patients, including many of the city’s underserved Chinatown residents.


In 1998, the then-CEO of NYU Downtown, Virgo Lee, told a congressional committee the hospital had suffered “from almost three decades of neglect to its physical plant.”


Compounding the financial difficulties, the hospital, at William Street in the shadow of the Brooklyn Bridge, suffered severely from the attacks on the World Trade Center. As the closest acute-care medical facility to ground zero, it became a triage hub in the chaos of falling debris. For weeks after the attacks it remained in the cordoned-off zone in Lower Manhattan, which was closed to traffic by police and National Guard barricades.


NYU Downtown, which has long had the aura of a community hospital, is investing in services. Some sources said, however, that there has been dissatisfaction among the facility’s administrators that NYU does not consider it ripe for investment and sees it as something of a drain on institutional resources.


Another issue is the dual challenge NYU Downtown faces as the hospital both to an impoverished Chinese community and to the powerhouse Wall Street crowd.


The hospital, which sold its parking lot to developer Forest City Ratner last year for a reported $85 million, is currently building a new emergency room for $25 million. The project has benefited from large contributions, including $5 million from the investment banking firm Lehman Brothers, for which the new unit is to be named. The new 28,500-square-foot space is expected to increase patient capacity by 33%.


The pending split is not much of a surprise. In the past decade, hospitals systems around the country have joined forces to augment their negotiating leverage with insurance companies and vendors.


Some of those partnerships have failed, such as the 1998 merger of Mount Sinai Hospital and NYU Hospital Centers. Those systems have been unraveling but are still tied together by shared debt. In that case, NYU was regarded as the stronger institution, dragged down by a less competent partner.


Other mergers, including that of Presbyterian Hospital and New York Hospital, seem to have succeeded. That institution operates comfortably in the black and is the only city hospital that consistently makes the list of best hospitals in the country in U.S. News & World Report.


The New York Sun

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