As first reported by NY1 on Saturday, Governor Andrew Cuomo's administration says the plan to save Long Island College Hospital will move forward with state grant money.
The deal calls for merging the hospital, located in Cobble Hill, Brooklyn, with SUNY Downstate.
Long Island College Hospital appeared to be in jeopardy earlier this week when the state decided to review the $62 million grant needed for the merger.
However, sources say after a meeting with elected officials Friday night in Manhattan, a deal was reached to keep the grant in place.
That allows about 2,500 workers to keep their jobs.
In a statement, Cuomo said he made the decision to go ahead with the grant, despite former Governor David Paterson's concerns.
Cuomo also said he consulted with local community and elected officials.
The merger is the first time in state history that a private medical center will be run by a public one.