What's so disgusting? SGU needs places to rotate its students at, and so it is paying a hospital system in need of money for rotation spots. Now, in an ideal world this wouldn't need to happen, but it seems like win-win for the HHC because they are getting money and at the same time getting a guaranteed supply of US-born physicians applying to and likely matching in their hospitals that are usually ignored by AMGs.
Now if you want to bring up an issue like how they sometimes cram tons of students into scarcely supervised services, that's something else, but them paying for rotations is no different than what many (if not most) DO schools do. Personally, I think its an inherent problem with the system that so many places have to pay for rotation sites, but can you really blame SGU for playing our game? I don't know, maybe you can blame the HHC for getting state money to train foreign students, but beyond that...
As far as Touro-NY being in trouble, I doubt it. The article is old, and honestly there are tons of hospital affiliates that Touro has. Maybe they won't all be in Manhattan, but they'll be nearby. That said, I hope their new Midtown campus has enough spots planned out.
SGU might be (or maybe I should say might have been) ok for people who just want to stay in NY/NJ, but everywhere outside of that region (and even in many residencies in that region) DOs have a much higher match success rate, and have more options with AOA residencies. On top of that, have you seen the SGU tuition and how expensive it is on those islands? Its like $30k/semester for tuition alone. That's double what I'm paying at a DO school within an hour drive of my immediate family. Thats just one of many reasons I (and pretty much everyone) would (and did) choose a DO school over SGU.