Interfaith Medical Center in Brooklyn to File Chapter 11–Can’t Even Afford Malpractice Insurance and Payroll Might b
Posted Dec 03 2012 9:51pm
Back in August the hospital was looking for a bail out and now it just doesn’t appear it’s going to happen as even back then they didn’t know how much longer they could meet payroll. The hospital is just a few miles from Manhattan where the money they need is located. At that time they needed about $10 to $30 million to continue. Yes it sounds like I’m back in to blogging about “Desperate Hospitals” again, the series I ran a couple of years ago.
In order to get help from the government they had to merge with with Brooklyn Hospital but that didn’t work out and now the hospital can’t even afford it’s malpractice insurance either. Being self insured has it’s advantages but not when the reserves and bank balances have gone to zero. The 2010 cut in Medicaid rates caused the hospital to have a drop of 40% in revenue. BD
The hospital, Interfaith Medical Center , serving Bedford-Stuyvesant and Crown Heights, has been in and out of financial trouble for decades, with its survival dependent on infusions of state aid. In difficult economic times, however, the Cuomo administration has not indicated a willingness to continue bailing out failing hospitals.
Interfaith officials said on Sunday that they had no choice but to file for Chapter 11 bankruptcy reorganization, given the hospital’s precarious financial situation.
But they said the hospital had a better chance of surviving in the long term if the state would guarantee it about $20 million in what is known as debtor-in-possession financing to underwrite its operating costs during the reorganization.
The hospital, at 1545 Atlantic Avenue, is so poor that it cannot afford malpractice insurance. In August, hospital administrators said that it was running out of cash and that they feared they would soon be unable to meet its payroll.