In February, the application for the merger failed to secure a recommendation from the state’s Public Health and Health Planning Council, the body that reviews and greenlights hospitals’ applications for projects, but was still sent to State Health Commissioner Dr. James McDonald for approval.
In response to the application, McDonald has laid out several stipulations that Sinai must meet to earn state approval of the project. According to the letter, sent in June and recently reviewed by Crain’s, project approval is contingent upon Sinai not closing any NYEEI clinical programs or inpatient beds or changing the “governing authority” as a result of the merger, without the greenlight from the department of health.
This past winter, as the PHHPC discussed the potential merger, some council members had raised concerns about Sinai’s shortcomings when it came to communication about the project—including a lack of community engagement. McDonald’s stipulations address those concerns by requiring that Sinai submit documentation of communication with stakeholders about the application, and a community engagement plan, to the health department. The community engagement plan must be acceptable to the department, McDonald wrote.
The health system must engage with the community about any potential transformations coming to the infirmary and Beth Israel, including Beth Israel’s long-term plans for service delivery, McDonald said in his memo about the merger, which was written to a Sinai vendor.
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Dr. Paul Lee, the president of the infirmary’s alumni association, said the specific nature of the contingencies sparked hope among merger dissenters that were initially disappointed by the letter, which signals that the merger has a path forward.
But some are skeptical that the health system might not be able to comply with such tall orders. Dr. Richard Koplin, the co-chief for the cataract division of the infirmary, said the stipulations seem “daunting” for the health system.
According to internal planning documents, Sinai’s plans to divvy up the NYEEI as a result of the merger include shifting services around the city, such as moving the infirmary’s operating rooms for eye and ear procedures—currently on East 14th Street—to Beth Israel, which is on East 16th Street, and a new ambulatory surgery center in the Flatiron District. That could pose a challenge to meeting the point about not closing clinical programs or inpatient beds, Koplin said.
Mount Sinai representative Loren Riegelhaupt did not address direct questions about how the hospital will comply with specific contingencies. However, he said that Mount Sinai has and continues to meet with elected officials and local leaders about the plan.
McDonald's letter also did not address a main sticking point that Sinai has argued in advocating for the merger: that NYEEI was in danger of losing its status as an acute care hospital because of a consistently low inpatient census. This winter, Dr. Jeremy Boal, the former president of Mount Sinai Beth Israel, framed the merger as a way of saving the infirmary by combining the two facilities’ figures.
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If NYEEI lost its status with the Centers for Medicare and Medicaid Services, Boal wrote in a January letter to the PHHPC, NYEEI would no longer be able to serve inpatients, outpatient rates would decrease and the infirmary would lose graduate medical education funding.
Despite Boal’s argument, Lee told Crain’s that six months later CMS has yet to inspect NYEEI's census and that gender-affirming procedures are keeping its census stable.
However, Riegelhaupt, of Mount Sinai, countered that “NYEE was at severe risk of losing its status as a standalone inpatient hospital without this merger,” maintaining that the merger would preserve the infirmary’s ability to offer services to the community, its funding and its ophthalmology residency program.
According to McDonald's letter, Mount Sinai is expected to comply with the contingencies throughout the operation of the project. Before beginning the project, the health system must enter a response for each contingency in the state's Certificate of Need system and receive written approval Center for Health Care Facility Planning, Licensure and Finance, indicating that the contingencies have been satisfied.
Mount Sinai has until June 13, 2024 to complete the project. Failure to do so could constitute abandonment of the project and risk expiration of the health department’s approval, McDonald wrote.
This story first appeared in Crain's New York Business.
