The New York State Department of Health has rejected Maimonides’ latest application for the H+H takeover, according to information obtained from sources familiar with the matter.

Senior MMC and H+H officials had been eagerly awaiting the application’s debut on the June 10th agenda of the Public Health Council’s Establishment and Project Review Committee (the “Establishment Committee”) — the body that must sign off on major transactions like this one. But when the agenda was published, the takeover was nowhere on it. According to internal MMC communications by senior professionals, the Department rejected the application for a basic reason: Maimonides had never filed the required Health Equity Impact Assessment (“HEIA”).

It is the latest setback for Maimonides and H+H, and it lands on top of a stinging court loss last month. On May 12, 2026, Justice Denise A. Hartman of the State Supreme Court in Albany granted an Article 78 petition brought by community members and institutions, throwing out the Department’s earlier approval of the $2.245 billion takeover as “arbitrary and capricious and affected by error of law.” The deal, she ruled, cannot move forward without full review and approval by the Public Health and Health Planning Council under Public Health Law §§ 2801-a and 2802 — the very review Maimonides and H+H had tried to skip.

The petitioners in that case — Refuah Helpline, et al. v. McDonald, et al. (Index No. 902792-26) — include Refuah Helpline; the Borough Park Kehilos of Bobov, Belz, Satmar, and Bobov 45; and individual community members who, with their families, rely on Maimonides for their care. They are represented by Martin Bienstock of Bienstock PLLC and Akiva Shapiro of Holtzman Vogel.

The Review Maimonides Skipped — and Whom It Protects

The rejection came just days after a June 2, 2026 letter from Shapiro — sent to counsel for the Department of Health at the State Attorney General’s office and copying the New York City Law Department — warning that pushing the deal through without a completed HEIA would be flatly unlawful.

The HEIA is no mere paperwork exercise. Under Public Health Law § 2802-b, enacted in 2023, an independent entity must study every certificate-of-need application to build or establish a hospital — and any change in ownership, merger, or acquisition that would eliminate, cut back, expand, or relocate a hospital service. The study must ask “whether, and if so how, a project will improve access to hospital services and health care, health equity and reduction of health disparities, with particular reference to members of medically underserved groups, in the applicant’s service area.”

And because the Albany court has already found the takeover to be both a “construction” and an “establishment” of a hospital, Shapiro wrote, “an HEIA is required for two independent reasons,” regardless of impact on services. If the Department lets the deal move ahead without one, he warned, any approval “will be arbitrary, capricious, and in violation of law … null and void.”

The point of the requirement is simple: force a hard look — before a deal closes, not after — at how a major hospital transaction will hit access to care for vulnerable and underserved populations, especially ethnic and minority communities. For Maimonides, that means the Hasidic, Yeshiva, and Orthodox communities of southwestern Brooklyn, anchored in Borough Park — along with the Arab, Chinese, Latino, Russian, Caribbean, and South and Southeast Asian patients the hospital also serves. Roughly 85% of Maimonides’ patients are on Medicare or Medicaid, and the hospital runs Brooklyn’s only comprehensive children’s hospital and its only Pediatric Trauma Center, among many other essential services — exactly the kind of safety-net care the HEIA exists to protect.

Putting together an HEIA will take Maimonides months, and could set the transaction back even longer. The Establishment Committee does not meet again until August 27, 2026 — and it’s an open question whether Maimonides can finish a thorough, independently prepared assessment, built on real input from community leaders, residents, and public-health experts, by then.

“Maimonides spent the better part of a year trying to dodge public review of this deal altogether,” said Bienstock. “Now that a court has ordered that review, it has to complete a months-long, independent health-equity study before the Committee meets again on August 27. That’s a deadline of Maimonides’ own making — and it’s far from clear they can meet it.”

The delay is just the latest blow to the takeover ,with H+H and Maimonides leadership making promise after promise about the timeline for the deal that they have not been able to keep. The sale was initially supposed to close on April 1, 2026 — a date the leadership of both H+H and Maimonides repeatedly promised to hit. As recently as March 2, 2026, H+H President and CEO Dr. Mitchell Katz assured the New York City Council that the deal was “anticipated to close by April 1, 2026.” That date came and went more than two months ago, and the takeover is now bogged down in regulatory rejection and litigation on several fronts.

A Deal Under Fire on Three Fronts

Even before this rejection, the takeover had already hit a wall in three separate forums:

The trustees’ lawsuit. The first challenge came from inside Maimonides’ own board. Seven trustees sued the hospital’s leadership in Kings County Supreme Court (Twerski v. Gibbs, Index No. 540340/2025), claiming the directors breached their fiduciary duties by chasing the takeover without a real search for alternatives or a proper governance process. The trustees won an initial temporary restraining order that froze the deal in late 2025; it was later dissolved, and the case is proceeding, with trustees seeking to have the transaction voided and permanently enjoined.

The Attorney General’s refusal. In March 2026, the Attorney General’s Charities Bureau refused to approve the transfer of Maimonides’ nonprofit charitable assets to the City of New York on its own, sending the deal instead to full court review under Section 511 of the Not-for-Profit Corporation Law — a contested process that Maimonides has not yet even initiated.

The Article 78 case. Days earlier, the community petitioners had launched the Albany case that produced Justice Hartman’s May 12 ruling — throwing out the Department’s approval and ordering full Public Health Council review. That decision set the stage for the HEIA rejection Maimonides faces today.

“The system is working as it should,” said Bienstock. “It is repeatedly rejecting MMC’s unlawful attempts to circumvent the legal processes that are designed to protect healthcare delivery to the real people who rely on it every day.”