MONTCLAIR, N.J.—Montclair Health System set plans in motion to acquire Mountainside Hospital in Montclair by filing a certificate-of-need request with the state department of health to transfer the facility's ownership.

A subsidiary of for-profit Merit Health Systems, based in Louisville, Ky., has owned 245-bed Mountainside since 2007. Montclair Health is a partnership between the two-hospital and privately held LHP Hospital Group, Plano, Texas, along with the 696-bed and not-for-profit Hackensack (N.J.) University Medical Center. Financial terms weren't disclosed. “Looking forward, we are confident that LHP, as manager and operator of Mountainside, together with its local partner Hackensack UMC, will ensure this hospital is well-positioned for future growth,” Mountainside President and CEO John Fromhold said in a news release.

Trustees of Christ Hospital, above, have approved plans for a possible bankruptcy filing after Prime Healthcare withdrew its offer to buy the struggling hospital.

JERSEY CITY, N.J.—Christ Hospital's board of trustees approved plans for a bankruptcy filing “if necessary” after Prime Healthcare Services withdrew an offer to buy the struggling hospital. Trustees for Christ Hospital, a not-for-profit hospital, last week unanimously approved a Chapter 11 filing if it proves necessary “to maintain financial stability and to preserve its commitment to its patients,” according to a statement. A spokesman said no further information would be released. Christ Hospital's losses accelerated in 2009 compared with the prior year, according to the most recent financial figures available from tax filings. The hospital reported a loss of $18.3 million on revenue of $144.1 million for the year that ended Dec. 31, 2009, compared with a loss of $4 million on revenue of $175.8 million the year before. Prime Healthcare, a for-profit health system based in Wildomar, Calif., said in a statement that it rescinded its offer in response to “indications from respected local elected officials who wanted Christ Hospital to explore the option of keeping the hospital nonprofit and under local ownership.”

WORCESTER, Mass.—UMass Memorial Health Care, a five-hospital system, said it will eliminate hundreds of jobs and sell off some business units in order to avoid ending the current fiscal year with a loss. The majority of the cuts will affect the 700-bed UMass Memorial Medical Center. UMass Memorial Health Care said it plans to eliminate about 150 full-time positions at the medical center, medical group and corporate departments. It also plans to reduce expenses within the corporate departments in Worcester and cut back on hiring for positions that do not affect patient care. UMass Memorial Health Care also said it is in discussions to sell the lab-testing business and plans to seek a buyer for the system's home-health and hospice site in Worcester. The home-care and hospice sites at the HealthAlliance Hospital in Leominster and Wing Memorial Hospital in Palmer will not be affected, the system said in the news release. Other hospitals in the UMass Memorial Health Care system include Clinton (Mass.) Hospital and Marlborough (Mass.) Hospital.

ITHACA, N.Y.—Cayuga Medical Center, a 209-bed hospital in Ithaca, agreed to pay about $3.6 million to settle False Claims Act allegations with the U.S. attorney in Syracuse, N.Y. The settlement agreement stipulates that Cayuga does not admit liability. The U.S. attorney's office alleges that the hospital had “improper physician recruitment agreements” with some referring physicians, and then submitted related claims to Medicare and Medicaid from July 2004 to December 2006. The allegations stem from a whistle-blower lawsuit filed by Dr. Daniel Jorgenson, a plastic surgeon who had practiced in Ithaca. John Rudd, Cayuga's senior vice president and chief financial officer, said the hospital self-disclosed four contracts in 2007 after discovering that they were not compliant with newest physician recruitment regulations. The hospital had financial relationships with seven local physicians, including Jorgenson, who did not meet the Stark law exception for recruitment arrangements, according to the settlement.