Another Hospital Threatens to File for Bankruptcy

In a world where the pandemic continues, forcing hospitals to cancel elective surgeries and other procedures, it’s odd to see that so many are having financial difficulties. However, that’s the status of many of them today. Despite help from the federal government, these hospitals are laying off workers and planning to file for bankruptcy, if they haven’t done so already. One new hospital to add to the list, Montefiore St. Luke’s Hospital in Newburgh, NY, is also facing financial difficulties.

New York Hospital Warns of Financial Issues

Montefiore St. Luke’s Hospital in Newburgh, N.Y., is facing a potential financial crisis because lenders are calling in loans worth $40 million, President and CEO Joan Cusack-McGuirk told the Times Herald-Record.

Ms. Cusack-McGuirk said KeyBank is calling in a pair of loans worth $22.2 million, a move that she says led HSBC and Assured Guaranty to call in loans that are part of the same debt package. Bankruptcy and mass layoffs are possibilities if hospital officials are unable to get the banks to reverse course, Ms. Cusasck-McGuirk told the Times Herald-Report.

Though KeyBank can’t discuss the specifics of the hospital’s case because of client confidentiality, a spokesperson told the Times Herald-Report that “many of the facts as presented are inaccurate.” The bank said it’s working with the hospital to reach a resolution.

The financial institutions called in the loans after the hospital slipped into “technical default,” Ms. Cusack-McGuirk said. In recent years, the hospital entered a forbearance because it violated its liquidity and cash flow covenants, according to the report.

One Good Solution

If your hospital has any aged claims, filing Federal ERISA appeals on them is one good way to add extra funds to your coffers. Even if those aged claims – including the ones that have gone through their three state-level appeals – make up a small percentage of your overall claims, every penny counts. Contact us today to see what we can do for you.