Revival Home Health Care and 1199 Devise Plan to Save Financially-Distressed Facility
A FROM THE G-MAN EXCLUSIVE
Peninsula Hospital Center sources informed From The G-Man that a meeting was held between investors, revealed to be Revival Home Health Care, and SEIU/1199 members on August 31 at the Union Hall building on West 42nd Street in Manhattan.
Two independent sources confirmed the meeting ran from 1 p.m. to 5 p.m. and that the sides reached a tentative agreement that there would be a 60-40 split in absorbing financial risks.
Two independent sources confirmed the meeting ran from 1 p.m. to 5 p.m. and that the sides reached a tentative agreement that there would be a 60-40 split in absorbing financial risks.
The union would take 60 percent -- when broken down amounts to $4.8 million -- and Revival Home Health Care would take the remaining 40 percent, estimated to be $3.2 million. The $8 million total represents money that Revival Home Health Care will invest to help place Peninsula Hospital Center on the road to fiscal recovery.
"The risk factor came into play when Revival Home Health Care proposed they be put ahead of the union, as far as creditors were concerned, and that if their efforts failed, they would be paid back the $8 million invested, first, before any money went to the union," said one source.
"The union didn't accept that because if they were not fully reimbursed, then the $8 million debt would fall on them. Thus, 1199 members felt they would bear a larger share of the financial responsibility and Revival Home Health Care would have nothing to lose in the deal."
By meeting's end, a decision was made that Revival Home Health Care would take over Peninsula Hospital Center and file for Chapter 11 restructuring.
The Plan - Revival Home Health Care owns a home care network that consists of approximately 3,500 patients that are contacted on a daily basis for health updates. Should a patient need to be admitted to hospital, they would be referred to Peninsula Hospital Center.
Revival HHC also owns an ambulance company called Revival Care, which they intend to link directly to the hospital. Plans are also underway to establish an emergency call center at the hospital to allow a greater number of patients to be brought into the facility.
A second source noted that the Brooklyn-based healthcare company has established relationships with a number of nursing homes, many of which would send their residents to Peninsula.
"They also have a network of physicians that would refer their patients to the hospital," said the source.
"Remarkably, Revival HHC feels they can have the hospital census at full capacity in about three weeks."
The Deal - Revival Home Health Care will pay the SEIU/1199 $150,000 a week towards the debt the hospital owes the union, rather than the $250,000 a week requested by the union. The union will continue to work with Revival HHC as long as the monthly payments are made.
Union breakdown of payments from the hospital to the union to sustain funds are as follows: Percentages of payroll - benefit fund is 28%, Pension fund 9.3%, Training & upgrading fund .5%, Child care fund .5% and Job security fund .25%.
The Peninsula Hospital source stated, unequivocally, that Robert Levine, CEO of Peninsula Hospital Center, and current Board members would be replaced by Revival Home Health Care representatives or other healthcare officials.
"The hospital will definitely be open for 90 days while a three-phase plan is enacted," the source said.
"The first phase will involve taking over and reviewing the finances of the hospital, which Revival said had been poorly managed for years. The second phase will focus on implementing changes to various areas, starting with billing and receiving, to help bring money back into the hospital," the source added.
"Remarkably, Revival HHC feels they can have the hospital census at full capacity in about three weeks."
The Deal - Revival Home Health Care will pay the SEIU/1199 $150,000 a week towards the debt the hospital owes the union, rather than the $250,000 a week requested by the union. The union will continue to work with Revival HHC as long as the monthly payments are made.
Union breakdown of payments from the hospital to the union to sustain funds are as follows: Percentages of payroll - benefit fund is 28%, Pension fund 9.3%, Training & upgrading fund .5%, Child care fund .5% and Job security fund .25%.
The Peninsula Hospital source stated, unequivocally, that Robert Levine, CEO of Peninsula Hospital Center, and current Board members would be replaced by Revival Home Health Care representatives or other healthcare officials.
"The hospital will definitely be open for 90 days while a three-phase plan is enacted," the source said.
"The first phase will involve taking over and reviewing the finances of the hospital, which Revival said had been poorly managed for years. The second phase will focus on implementing changes to various areas, starting with billing and receiving, to help bring money back into the hospital," the source added.
"Revival will also be working with their partners and existing businesses to bring more patients in and improve hospital services and equipment during the second phase, and the final 30 days will be used to determine if the overall plan has proved to be successful and viable for Peninsula Hospital."
Information on Revival Home Health Care is available at http://www.revivalhhc.org/.
Information on Revival Home Health Care is available at http://www.revivalhhc.org/.
From The G-Man will continue to closely monitor this story and report on any new developments as they become available.
Image courtesy of http://classroomclipart.com.
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