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The new owners of East Orange General Hospital aim to strengthen mental health

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East Orange General Hospital in New Jersey is changing hands, the for-profit company announced on Friday.

Paige Dworak, who will be the first female owner and CEO of a New Jersey hospital, will continue to run the business and take a 20% stake. The EOH Acquisition Group, the new owners, want to stabilize the ailing hospital that has suffered operational losses over the past two years.

“We are very excited about the future of this historic hospital and its impact on the community,” said Dworak, who has headed the 201-bed hospital since 2017, in a press release. “The change of ownership will help accelerate the transformation of this vital community asset and ensure that the hospital continues to deliver the high-quality care that patients and the community have relied on for over a century.”

The New Jersey State Health Planning Board has approved the acquisition, which has yet to be approved by the state Department of Health.

The EOH Acquisition Group includes Dworak, Attorney Troy Shell, and Ben Klein, who owns more than three dozen behavioral medicine and substance abuse treatment centers. Investors will keep existing services and integrate mental health and primary care.

The new owners plan to open Essex County’s first inpatient substance abuse center, build a new residential substance abuse treatment center, expand primary care, family medicine and multidisciplinary services, and offer transcranial magnetic stimulation for depression and anxiety.

East Orange General Hospital, Essex County’s only acute care facility, is one of the few remaining independent hospitals in New Jersey. The facility went through a Chapter 11 bankruptcy reorganization in 2015 after Los Angeles-based for-profit hospital operator Prospect Medical Holdings bought it for $ 84 million.

The hospital market in Trenton, New Jersey is highly concentrated, according to an analysis of commercial claims data by the Health Care Cost Institute as defined by the Herfindahl-Hirschman Index. Inpatient prices in the Trenton area rose 9.3% from 2012 to 2014, data from the Health Care Cost Institute shows. The hospital market has concentrated from “moderate” to “strong” during this period.

East Orange General Hospital recorded an operating loss of $ 11.2 million on sales of $ 80.9 million in 2020 and an operating loss of $ 79.8 million on sales of $ 84 million in 2019. East Orange received $ 15.7 million in COVID-19 relief funds in 2020.

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