Jerusalem’s Hadassah Medical Center was given a 10-day reprieve yesterday by a Jerusalem District Court judge to reach a bailout agreement.
The cash-strapped medical facility, which is sponsored by the New York-based Hadassah women’s organization, had been granted a three-month court order protecting it from creditors that is due to expire on May 11. But the court-appointed trustees in the hospital’s case had set a deadline of next Tuesday for an agreement, after which they said they would present their own restructuring plan.
The trustees, Lipa Meir and Asher Axelrod, threatened earlier this week to liquidate the medical center’s two hospitals if the parties did not accept the plan, but Axelrod told the court yesterday that substantial progress had been made since the most recent prior hearing in the case.
The judge has now ordered the trustees to put together a document by next Wednesday summarizing the points of contention and agreement between the parties. In practice, the judge gave the parties 10 days, until May 4, at which time the trustees are to report on whether the talks have been a success or a failure. At that point, the trustees will be allowed to present the document or any other proposal as the basis for resolving the hospital’s plight.
All of the parties involved in the case, including hospital administration and Hadassah employees, expressed opposition to the trustees’ recovery plan, while a representative of the Justice Ministry’s Official Receiver said the trustees and the involved parties were only 50 million shekels ($14.4 million) apart, making the liquidation of the medical center an avoidable failure.
Hadassah Medical Center has an accumulated deficit of 1.25 billion shekels ($360 million), and its situation has become even more dire since the request for protection from creditors was filed, due to a decline in revenues since. That was partly the result of a 16-day strike by employees.
Judge David Mintz gave the hospital’s administration permission yesterday to pay employees their April salaries without deducting pay for strike days or for nine days in February for which they were allegedly overpaid. Hadassah Medical Center director general Avigdor Kaplan said employee morale was already low and if they were not paid in full, things would completely deteriorate, as otherwise their April paychecks would be negligible.
The Histadrut labor federation has threatened to declare a labor dispute at all of the country’s public hospitals if a solution at Hadassah is not found.
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