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Still no deal to join Southampton, Stony Brook hospitals

The emergency entrance to Southampton Hospital in Southampton,

The emergency entrance to Southampton Hospital in Southampton, March 26, 2014. Credit: Gordon M. Grant

Twenty-two months after they signed a letter of intent in which Southampton Hospital would join Stony Brook University Hospital's health care system, the two do not appear close to finalizing the deal.

Instead, both hospitals said recently that, while talks continue, the agreement is complicated and they are operating under no specific timeline. Two legislators attribute some of the slow pace to SUNY's recent painful experience with the money-losing Long Island College Hospital in Brooklyn that SUNY had acquired.

To much fanfare, Stony Brook and Southampton announced on Oct. 1, 2012, a nonbinding letter of intent in which the 125-bed East End hospital would operate under the 603-bed Stony Brook hospital license.

Hospital officials said then that they envisioned the deal would take six to 12 months to complete and a new hospital -- using funds raised by the East End hospital -- could be built on Stony Brook's Southampton campus in three to five years.

The deal was touted as a way to boost health care on the East End and, with a new hospital, the area's economy. Officials also said it could give the underused Southampton campus a new purpose and help solidify Stony Brook's position as the anchor for Suffolk health care.

In March of this year, Stony Brook's chief executive, Dr. Reuven Pasternak, said he hoped the agreement could be presented to the State University of New York board of trustees for ratification this spring, which did not happen. Nor did it happen at the trustees meeting on July 31.

"As thoughtful and positive discussions continue, we understand the level of due diligence that needs to take place in order for this partnership to be beneficial to both hospitals and to the community," Stony Brook said in a statement Tuesday. "At this point there are still a number of standard reviews that need to take place which will ensure a strong alliance for the future."

Marsha Kenny, a spokeswoman for Southampton, agreed. "There's no timeline, no schedule. There are a lot of details to go over," she said. "This is being done the right way, and that is really important."

At the July 31 meeting, SUNY board chairman H. Carl McCall said the trustees "agreed today to continue to work with Stony Brook University to move this forward."

And he said that, in addition to approval by the trustees, the deal must pass muster with the state division of the budget, comptroller's office and attorney general, "as is typical for all these projects."

Morris Peters, a spokesman for the division of the budget, said the agency is "giving the matter its due diligence to better understand the financing, Stony Brook's relationship with Southampton Hospital, and regional health care needs on Long Island. This is a unique transaction and it warrants proper research." He, too, said there was no timeline.

Both the comptroller's office and attorney general's office said they have not seen the contract.

Assemb. Fred Thiele Jr. (I-Sag Harbor) said he believed SUNY's experience with Long Island College Hospital -- known as LICH -- has slowed the process for Stony Brook and Southampton.

The Brooklyn hospital, at risk of closing and $170 million in debt, merged with SUNY Downstate three years ago and was given $62 million in state grants. SUNY faced intense political pressure, including from Bill de Blasio before he became New York City mayor, to keep it open as a full-service hospital, even as it was losing $13 million a month. On July 1, SUNY signed a contract to sell the hospital for $240 million.

"I think it's because of LICH," Thiele said. "Every time you talk to someone, the first thing they bring up is LICH."

"There's a little frustration locally," he added later.

State Sen. Kenneth LaValle (R-Port Jefferson) agreed. "Certainly this is a LICH effect," he said. He, like Thiele, said that the Stony Brook-Southampton agreement will be different. Southampton finished 2013 with a $9 million surplus.

He said SUNY understaffing also has made it hard to get things done quickly.

"No one is slowing the process down deliberately," he said. "It is a deliberative process."