The on-again, off-again merger between the Albert Einstein School of Medicine and Montefiore Health System is back on, according to statements released yesterday.
Key terms of an agreement between Yeshiva University and Montefiore Health System have finally been reached, according to a joint statement released by the two schools. The merger, an attempt by Yeshiva University to shed its costly medical school, faltered in early December, after the two parties were unable “to agree on certain material terms,” according to a YU representative.
Moody’s could not comment as to whether this move could cause it to upgrade YU’s debt rating, which it put at the junk grade of B3 in March. According to a Dec. 9 report, the medical school is responsible for two-thirds of the deficit.
Einstein dean Allen Spiegel broke the news at a student rally Tuesday morning attended by over 200 students, according to one attendee. Students had organized the rally to show support for the merger.
Alyssa Casill, a second year Ph.D. student at Einstein and co-chair of the graduate student council, one of the student organizations that organized the rally, said students started to “rally the troops” in support of the partnership after details of YU’s “Plan B” surfaced.
According to Casill, students found out two weeks ago that YU would make major cuts to Einstein’s research program if the merger failed. At an Einstein Senate meeting two weeks ago, Einstein faculty unanimously took a vote of "no confidence" in the Yeshiva University board, she said.
“Uncertainty is the right word,” she said, describing the mood in the student body after news of the merger’s failure in December. “No one knew exactly what the fallout would be, but everyone was worried.”
At the rally, students were “really excited” about the news, she said. “We knew we had to take a stand.”
While the new agreement is still subject to final documentation and regulatory approval, it seems negotiations, begun in July 2014, are nearing an end.
When the merger collapsed in December, the representative said details were “confidential” but that the “longstanding affiliation between Yeshiva and Montefiore remains in effect.”
President Richard Joel of Yeshiva University first announced the plan to merge in May 2014. Under the arrangement, Montefiore would take responsibility for the financial management of Einstein, but YU would remain the degree-granting institution with “a key role in the educational aspects of the entity,” according to a joint statement released in June. The institutions have collaborated on some level for 50 years.
Montefiore in the Bronx is the teaching hospital for Einstein. Founded in 1955, Einstein has 734 medical students, 236 doctoral students and 106 students in the combined M.D./Ph.D. program.
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The announcement to merge the institutions came two months after a report by Moody’s Investors Service warned that YU was at risk of running out of money by the end of 2015 unless operational changes were made. The report cited equipment upgrades at the Einstein school as one reason for cost overruns.