NJ Hospital In Financial Duress Given 24 Hours To Draw Up Disaster Plan

A beleaguered hospital in Essex County has just 24 hours to draw up a financial disaster plan, the state Department of Health ordered.

In a letter sent to Carewell Health Medical Center in East Orange, Gene Rosenblum, the director of the Office of Program Compliance paints a dire financial picture for the hospital.

CareWell Health Medical Center has low cash on hand, maintains negative operating margins and has cited other issues with emergency cash flow, he said. The hospital has not made any payments for the entire fiscal year for the assessments it owes the Department of Health, according to Rosenblum.

The Department of Health recently reduced the hospital's Medicaid payments in response, Rosenblum said.

The financial distress could force a disruption in services or see the hospital close abruptly, Rosenblum said. The Department of Health is requiring the hospital submit a "written, comprehensive disaster plan" that includes procedures in case the hospital needs to be evacuated, or if there is an interruption of utilities services, and alternate facility to relocate patients.

On March 7, the state's health department placed an indefinite, full emergency divert on the hospital's emergency department, according to a letter published to the NJDOH website . Officials gave CareWell Health until March 13 to "satisfy all DPOC requirements." A curtailment of all admissions would be put in effect if that didn't happen.

Attempts to reach CareWell Health were unsuccessful.