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Northern Berkshire Healthcare Files Bankruptcy; Court Continues Restraining Order

Jim Levulis

Northern Berkshire Healthcare, the parent company of North Adams Regional Hospital, has filed Chapter 7 bankruptcy. The hospital closed on March 28th.

After being informed of the filing Thursday morning, Berkshire Superior Court Judge John Agostini continued a temporary restraining order put in place March 28th allowing Berkshire Medical Center to take necessary steps to operate a satellite emergency facility at North Adams Regional Hospital. The order holds until a hearing Tuesday in Northampton, where Agostini will be on other matters. Representatives from the attorney general’s office say they were informed Wednesday there was a possibility bankruptcy would be filed Thursday. The AG’s office was hoping to put in place an injunction to keep emergency services operating for 90 days during any transition or closure. Bart Hollander is with the AG’s office.

“Our goal remains unchanged from last week to this morning and that is to protect the public interest and to protect as well as we can, given the changing landscape from day to day, the public health emergency that exists from the sudden closing of the North Adams hospital,” said Hollander.

Attorney Dan Cohn, representing NBH, requested action be put on hold until the bankruptcy court appoints a trustee to be in charge of the company’s now liquidated assets. Cohn is hopeful the appointment will be made today. BMC can operate the satellite emergency facility once the Massachusetts Department of Public Health, the Centers for Medicare and Medicaid Services and the U.S. Drug Enforcement Administration give it authority. Massachusetts Governor Deval Patrick and the area’s federal delegation have said they are working as quickly as possible to get those licenses. Berkshire Health Systems attorney John Rogers says in the meantime, work is ongoing at North Adams Regional Hospital transferring medical records to BHS and preparing the satellite facility. Rogers says BHS has employed about 110 of the 530 former NBH employees. Cohn says NBH has prepaid a separate “skeleton staff” of company employees through the week to help transfer those patient records and assist BMC and the DPH during the transition.

“They’re in kind of a limbo status, if you will, until the trustee comes in and tells them what he wants to do,” said Cohn.

Cohn believes access to the facility will continue under the appointed trustee.

“At the moment our employees are still there and they will be there unless ordered by the trustee not to be there, but I would expect that the trustee would be pleased to have the staff in place to continue to perform our duties to patients,” said Cohn.

The Massachusetts Nurses Association, which represents about 100 former NBH employees, and Wells Fargo Bank, an indentured trustee of NBH’s assets, have also been accepted into the case as intervening parties in order to have a say in the proceedings. Attorney General Martha Coakley says her office will investigate whether NBH broke any laws in closing the hospital March 28th with less than three days notice, stating there are regulations requiring 90 days notice. Cohn says financial restructuring was not a viable option.

“You need to have the means to perform your obligations,” Cohn said. “The last thing in the world anybody would have wanted would have been to have a facility that was out of money and didn’t have the ability to provide high quality and safe healthcare. To be out there trying to provide some other kind of healthcare. So what we’ve done is we have performed our duties as best we can under the circumstances.”

Cohn says while NBH is now largely out of the picture after filing bankruptcy, the company hopes stable medical services can be provided. One of five family members who worked at the hospital, Susan Wood was employed by NBH for 37 years, most recently in financing. Not represented by a union herself, Wood joined a handful of MNA and SEIU1199 representatives at the hearing.

“I don’t know what the next step is, but I did get the feeling everybody is trying to work together even with all the different parties in the room today, I really feel like everybody does want a good outcome,” said Wood.

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