Skilled Nursing Problems In Connecticut?
April 18, 2008
April 18, 2008
It was bad enough when Haven Healthcare, operator of 25 skilled nursing facilities, of which 15 are in Connecticut, filed for bankruptcy protection late last year, but a second local chain also filed for bankruptcy protection a few weeks ago, Marathon Healthcare. This company is much smaller, with just six nursing facilities in Connecticut and one in Massachusetts, but it was the Massachusetts facility that was causing most of the problems for Marathon.
According to one report, $4.2 million had been "drained" from the Connecticut facilities to cover the losses at the Springfield, Massachusetts facility, which Marathon stated they planned to sell. Now we hear that the facility will be closing no later than June 10 because negotiations with a potential buyer fell through. There has been no word where the 88 or so residents will be going, but if history serves us correctly, the Springfield market has been overbedded and there should be room in other facilities, even though it will be quite disrupting for the residents. What will happen to the 100-plus employees at the facility is anyone's guess, other than an unemployment check for the immediate future.
Marathon paid about $2.5 million for the Springfield facility two years ago, but we don't know what the debt on the building is and how the lender/lessor will get paid off. That's for the bankruptcy court to deal with, but if anyone wants to do a quick deal and has a good relationship with the Massachusetts Department of Health, the time to act is now. We believe, however, that the Commonwealth will not be too sad to see this one close.