This is one hospital who got lucky…in a sense…as the article states, this was not the ideal situation but it beats the alternative of an empty building of service to nobody. The council had to eat the 19.3 billion owed by the hospital, not to mention the city itself has a 6.2 million deficit at the same time. In 2007 there were cuts of up to 24 million, still not enough to bring solvency. Around half of the hospitals in the US are balancing on not becoming insolvent. Things could also stand to change quite a bit when the facility becomes a “for profit” organization. If not for the concessions, the hospital would not be able to be sold…BD
The vote paves the way for a very complicated process involving Chapter 11 reorganization bankruptcy and sale to a private group of physicians who would operate the facility as a for-profit hospital. Oakland Physicians Medical Center LLC is a collection of 72 physicians and would operate the 178-bed hospital, which employs more than 800, as a for-profit venture. They have said they would invest $20 million in the facility. There's also the question of $38 million in bonds, and a deal will have to be struck with bondholders as well.
Gary Gosselin: Sale right Rx for North Oakland Medical Center -
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