In the nearly 50 years since it opened its doors, East Jefferson General Hospital has been a treasured community institution. It was envisioned that way by the people who flocked to the growing suburb in the 1960s and voted to build the public hospital, and who would for decades vigilantly defend its independence against those seeking to merge it into a larger system.
But times change, as do the economics of providing health care. These days, community hospitals are struggling to compete against regional networks better able to offer up-to-date technology, economies of scale in operations and purchasing, leverage in negotiating with insurance companies, and an array of facilities that cross parish lines. As a standalone, East Jeff has struggled in recent years and is now in deep financial trouble, $135 million in debt and facing possible foreclosure.
That’s why the hospital’s board and the Parish Council have voted to sell the hospital to LCMC Health, the nonprofit system that runs five area hospitals including EJ’s counterpart across the river, West Jefferson Medical Center, plus Children’s Hospital, Touro Infirmary, University Medical Center New Orleans and New Orleans East Hospital. It’s also why the change has won endorsements from major business groups such as the Jefferson Chamber, JEDCO, and GNO Inc. as well as the Civic League of East Jefferson.
Now it’s up to the voters of Jefferson’s east bank to decide whether the sale should go forward. The delayed election is Aug. 15, with early voting starting Saturday and running through Aug. 8.
We urge them to approve the measure.
After years of debate over the hospital’s future, much of it overshadowed by politics, the time for deliberation and delay has run out. There are two options: Continued decline at best and catastrophe at worst, or a viable path forward.
Under the proposal on the table, LCMC Health would purchase the hospital for $90 million and provide as much as $15 million in additional performance-based payments. That, combined with the hospital's existing reserves, is enough to pay off current bonds, to fully fund employee pensions and to meet other outstanding obligations. The hospital group has also committed to preserving nearly 2,400 jobs and investing at least $100 million over five years in badly-needed upgrades.
This was a good deal when it was negotiated, and it’s even more urgent now that the coronavirus pandemic is putting extra strain on the health care system. The crisis is an apt reminder of how much is at stake.
The proposed sale may mark the end of East Jefferson General Hospital’s independence, but it’s the best way to fulfill the founders’ vision of a hospital that’s ready and able to serve the community where it sits.