St. Vincent’s Med Centers Declare Bankruptcy

Saint Vincent’s Medical Centers, a staple in the Catholic health care system in New York State, filed for Chapter 11 bankruptcy amidst an atmosphere of severe financial decay, lack of revenue and about $1.1 billion in debt.
The hospital system serves about 600,000 patients annually, generating about $1.6 billion in revenue with a net loss of $143.5 million. Despite its financial woes, Saint Vincent’s provided $104 million in charity health care to poor and uninsured patients last year alone.
“Due to operating losses, debt levels, cash flow and accounts payable issues, and a severe liquidity crisis, Saint Vincent Catholic Medical Centers voluntarily chose bankruptcy protection at this time,” said Davis Speltz, president and CEO of Saint Vincent’s Medical Centers, in a statement released this week. Speltz’s firm, Speltz & Weis, was hired by Saint Vincent’s in 2004 to restructure the failing system.
Saint Vincent’s Catholic Medical Centers consists of seven hospitals throughout the greater New York area, including two remaining hospitals in Queens — Mary Immaculate Hospital in Jamaica, and Saint John’s Hospital in Elmhurst — and four nursing homes. The bankruptcy proceedings list two hospitals for closure — Bayley Seton on Staten Island and Saint Mary’s in Brooklyn.
“During this process, our hospitals, nursing homes, and home health care agency will remain open and operating as usual. The system will retain its excellent physicians, maintain nursing levels for high quality care, and make capital investments in plant and equipment,” said Speltz. Saint Vincent’s officials maintain that the remaining hospitals in the system will stay open but it is speculated that the move will undoubtedly affect a minimum of 1,300 employees out of the 11,500 employed throughout the system.
Saint Vincent’s had already begun the closure of Saint Joseph’s’ Hospital in Flushing after an announcement last August and the approval of the Department of Health. Saint Vincent’s is amongst a growing trend of local hospitals who have sought Chapter 11 protection under the bankruptcy laws.
Parkway Hospital in Forest Hills made a similar announcement this past week citing the need to “reorganize and restructure.” Many hospitals in New York face a grim future due to rising health care costs, lack of insured patients, the dominance of HMO coverage in the private sector and increases in malpractice insurance.
Saint Vincent’s Catholic Medical Centers was formed in 2000 after a merger of Catholic Medical Centers of Brooklyn and Queens, Saint Vincent’s Hospital and Medical Center of New York and Sisters of Charity Healthcare in Staten Island.
The system’s namesake, Saint Vincent’s Hospital Manhattan, has served the New York community for over 150 years since its opening in 1849.