Cabrini Medical Center, a not-for-profit acute care voluntary hospital in New York, NY formally filed for Chapter 11 bankruptcy protection on July 9, 2009. Cabrini closed its doors early in 2008. The Chapter 11 petition was filed in United States Bankruptcy Court in the Southern District of New York. The medical center was founded in 1892 by Saint Frances Xavier Cabrini, and was a member of the Mount Sinai Health System in New York City.

According to legal documents filed with the Bankruptcy Court, including the bankruptcy petition, and an affidavit filed by Cabrini's Chief Operating Officer, as of May 2009 net book value of Cabrini's assets was $46 million, and its liabilities totaled approximately $167 million. Prior to its closing, Cabrini had a decline in inpatient treatment due to factors including regional over-concentration of medical/surgical beds, financial pressures caused by cuts in Medicare and Medicaid funding, declining indigent pool payments, and an increase in managed care penetration at lower rates.

Cabrini's attempts to sell or lease some of its building assets fell through due to the global credit crisis, as well as mounting litigation and judgment against the corporation, impacting financing. Cabrini is asking the court for approval to utilize real estate brokers Grubb & Ellis to market the property through a sale, lease or other transactions, while addressing obligations to creditors under a Chapter 11 plan.

The top five secured creditors are: Sun Life Assurance Company of Canada ($35.1 million); Missionary Sisters of the Sacred Heart (Chicago, IL) ($33 million); Missionary Sisters of the Sacred Heart (New York, NY) ($18.7 million); 1199 SEIU National Benefits Fund ($5.1 million); and an affiliate of Saint Vincent Catholic Medical Centers (New York, NY) ($4 million).

The Medical Center was known for its inpatient medical/surgical, psychiatric and rehabilitation services, state-designated AIDS center, and hospice program. Pax Christi Hospice, Inc. has assumed operation of the hospice program.

Report based upon public documents filed in U.S. Bankruptcy Court, Southern District of New York.

More Industry Headlines