1990 Symmes out of bankruptcy

Symmes Hospital released from intensive care. (emerges from chapter 11).

Boston Business Journal 10.n26 (August 20, 1990): pp5(1). (597 words)

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Author(s): Joe Clements.

Document Type: Magazine/Journal

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COPYRIGHT P&L Publishing Corp. 1990

Symmes Hospital released from intensive care

Less than a year after mounting debts forced it into bankruptcy court,

Symmes Hospital of Arlington emerged from Chapter 11 last week. With

the sales of its two sister facilities helping to repay creditors,

Symmes Hospital is the only remaining piece of the former

Choate-Symmes Health Service group.

Despite the loss of Choate Hospital in Woburn and its Wilmington-based

health center, Symmes Hospital spokeswoman Barbara Kimball said the

institution is pleased with the results of its reorganization plan.

That plan was approved two weeks ago by US Bankruptcy Court Judge

Harold Lavien.

"We filed with the objective of selling off our assets and hopefully

having one of the entities emerge as a stand-alone facility," said

Kimball, vice-president for patient services. "And fortunately, that

is what happened."

Choate-Symmes Health Services found itself floundering last year for a

combination of reasons, including $32 million in bond holdings which

it could not make payments on.

There were also compliance difficulties with the Massachusetts Rate

Setting Commission and a statewide hospital industry battle over

Medicaid reimbursements owed by the Dukakis administration.

Choate-Symmes ultimately filed for bankruptcy in October 1989.

Two buildings sold

The bulk of the repayment plan came from the sale of the two other

facilities, Kimball said. Choate Hospital, a 130-bed acute care

hospital, was purchased by a Woburn real estate developer for $3.1

million. The 12-year-old Wilmington property was sold for just over $5

million. Both institutions had been affiliated with Symmes since 1981.

Symmes' emergence from bankruptcy was hailed by Massachusetts Hospital

Association President Stephen Hegarty, who said the hospital's

survival will bolster investor confidence in the industry. Had Symmes

failed, those holding the tax-exempt bonds would have received very

little in return, he said.

"If a bond truly defaults, it puts a scar on the whole health care

industry," said Hegarty. "So it's very important that there are ways

out of these situations for a hospital to restructure and enable the

bondholders to be repaid."

Almost closed

Hegarty also said that Symmes was in danger of closing down earlier

this year because the state's hospital conversion board was

considering a recommendation that it not be allowed to continue. That

would have had a serious effect on hospital services for the

community, he said.

"Arlington is a very densely populated area for the elderly, and they

really depend on having that facility in such close proximity,"

Hegarty said. "Certainly the citizens of Arlington now have a better

sense of security knowing that those services will be available to

them."

Symmes Hospital appears to be on solid ground for the time being. As

part of the reorganization, the 148-bed institution has a new

president and chief executive officer in David Speltz, as well as a

new management team called Hospital Management Professionals.

"We really look at this as having another opportunity to provide

quality health care in an effective manner," Kimball said. "And we

intend to survive - we're really going to change the way we do

business."

Kimball also praised the hospital's 700 employees for standing behind

the administration during the past 10 months. She said there was less

turnover than in previous years, despite a salary freeze and no

cost-of-living increases.

Quick reorganization

Due to that cooperation and the new focus of the hospital, the

organization was able to complete its Chapter 11 plan quicker than

expected, Kimball said.

"It was a joint effort," she said. "It was a combination of hard work,

the cooperation of the bondholders, and the support of the employees

that helped us get through this."

Source Citation

Clements, Joe. "Symmes Hospital released from intensive care." Boston

Business Journal 20 Aug. 1990: 5. General OneFile. Web. 24 Dec. 2009.

<http://find.galegroup.com.ezproxy.bpl.org/gtx/start.do?prodId=ITOF&userGroupName=mlin_b_bpublic>.