Thursday, August 23, 2012

Ocean Healthcare Acquires Buttonwood Hospital for $15M

Ocean Healthcare purchased the Buttonwood Hospital, located at 600 Pemberton Browns Mills Rd. in New Lisbon, NJ, from the Burlington County Department of Economic Development for $15 million, or $75,000 per bed.

The 200-bed psychiatric and nursing home was administered by the State Government for the past 150 years. It includes 170 long-term care beds and 30 psychiatric beds with average occupancy at 96 percent. The 156,372-square-foot building was constructed in 1986 on 22.3 acres in South Burlington County.

The hospital was sold to save nearly $4 million in property taxes and subsidize the $24 million in annual hospital operation costs due to declining federal insurance reimbursements.

In an auction held back in March 2012, Ocean Healthcare was the only bidder. Bidding was started at $15 million, and the sale finally closed August 14th. Conditions on the sale include keeping the current patients and operating the facility for at least 10 years. 80 percent of the beds are to be used for Burlington County residents, and 60 percent are reserved for Medicare and Medicaid residents. Medicaid payments account for more than 80 percent of the facility's revenue.

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