Vindicated in court, the New York City Council and community activists have delayed, if not derailed, the city's lease of Coney Island Hospital in Brooklyn to a private, for-profit hospital management company.
State Supreme Court Justice Herbert A. Posner in Queens ruled last week that the City Council should have been allowed to review and approve the embattled lease deal with Primary Health Systems-New York.
PHS-NY is an affiliate of Wayne, Pa.-based Primary Health Systems.
The ruling has broad implications because future attempts to privatize city hospitals also would be subject to City Council scrutiny.
However, the city said it will appeal, and, despite the delay caused by the ruling, a spokesman for PHS-NY said the company remains "unequivocally committed to staying the course."
City Council Speaker Peter F. Vallone, Health Committee Chairwoman Enoch H. Williams and others brought the suit last summer, claiming the mayor was wrong to cut a deal for Coney Island without the council's blessing.
Posner agreed, saying that under a land use provision of the city charter, any sale, transfer or lease of New York City Health and Hospitals Corp. facilities to private operators requires council approval.
Furthermore, Posner declared that the lease violates HHC's charter. The corporation was created through an act of the New York State Legislature, which, in the court's view, "cannot possibly have intended or expected that by granting HHC the right to enter into agreements or leases, HHC would be put into a position where HHC's board of directors essentially stripped the corporation of its control over the carrying out of its duties."
Through its sublease with PHS-NY, HHC "is shirking its own statutorily imposed responsibility, without the (New York) Legislature's approval," he wrote.
Alan G. Hevesi, the city comptroller, said the decision "means the city must have an open public debate about the future of HHC and the city's healthcare system, especially how to provide healthcare to the poor and those without insurance."
Said Vallone: "First, for privatization to take place, there must be public review and approval." The decision also "emphatically highlights the need to clear up the city charter and state law," he said.
HHC continues to insist that the deal is a solid one for the people of New York. "We believe the court's decision is erroneous both on the facts and the law," the corporation said in a statement.
PHS-NY "would like to see this resolved sooner rather than later," acknowledged Ethan Geto, a spokesman for the hospital company. But the company is prepared to cooperate fully with the council and hopefully persuade members that the deal provides "a major net benefit" to the community.