A draft of a New Jersey Health Department audit on Meadowlands Hospital Medical Center in Secaucus, N.J., which was bought by for-profit private investment firm MHA last year, identified financial problems despite the hospital's profitability, according to a report from The Record.
MHMC posted a 10 percent profit margin and paid investors roughly $8.4 million, but the audit showed it also defaulted on a loan and overdrew its bank account by more than $1 million last year — leading to several instances of bounced checks for employees, according to the report. In addition, the audit said MHMC had less than one day cash on hand when the New Jersey median is 62.
Hospital officials and owners disputed the findings in the audit, arguing the financial issues were the bank's fault. Tamara Dunaev, one of the main owners of the hospital and part of MHA, also said in the report the hospital made all of its loan payments and did not default.
MHA bought MHMC at the end of 2010 for $15 million. New Jersey has recently become a hotbed of for-profit hospitals. Currently, there are nine hospitals in the state that have already converted from non-profit to for-profit status or have explored the potential of doing so.
MHMC posted a 10 percent profit margin and paid investors roughly $8.4 million, but the audit showed it also defaulted on a loan and overdrew its bank account by more than $1 million last year — leading to several instances of bounced checks for employees, according to the report. In addition, the audit said MHMC had less than one day cash on hand when the New Jersey median is 62.
Hospital officials and owners disputed the findings in the audit, arguing the financial issues were the bank's fault. Tamara Dunaev, one of the main owners of the hospital and part of MHA, also said in the report the hospital made all of its loan payments and did not default.
MHA bought MHMC at the end of 2010 for $15 million. New Jersey has recently become a hotbed of for-profit hospitals. Currently, there are nine hospitals in the state that have already converted from non-profit to for-profit status or have explored the potential of doing so.
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