Already criticized for giving its CEO a $600,000 payout, the financial actions of Hoboken (N.J.) University Medical Center are once again the subject of scrutiny. This time, the former attorney for Hoboken University Medical Center said the city fraudulently pushed the hospital into bankruptcy, leading to his resignation, reports Herald News.
According to Donald Scarinci, who acted as general counsel from 2009 until July 16 of this year, Hoboken Municipal Hospital Authority held back millions in contractual payments so that the facility appeared to be in financial distress.
"I was the firsthand witness to a pattern of conduct by the Hoboken Municipal Hospital Authority board members to intimidate, threaten, control, abuse and attempt to force the CEO of [the hospital] and members of the board to take actions adverse to its charter and otherwise violate the laws of the state of New Jersey," he said in a court document filed yesterday.
The Hospital Authority attorney didn't respond to the fraud allegations, claiming they have no factual basis, notes the Herald.
As bankruptcy gains traction as a business option for hospitals and cash-strapped facilities are looking for ways to manage their obligations, hospitals should be cautious in filing Chapter 11 papers, as the public is growing increasingly skeptical of hospitals' motives.
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