Between 1993 and 2003 60 hospitals in California closed their doors. The Community Hospital in Granada Hills opened in 1965 was just one of those and shuttered it’s doors in August of 2003. I always wondered what it would look like to see inside the doors of one of those closed hospitals…
After the hospital was plunged into Chapter 11 bankruptcy because of the unexpected failure of a national accounts receivable management firm in 2002, trustees heeded the advice of the hospital’s bankruptcy counsel, its bondholders and a committee of unsecured creditors and hired a turnaround/crisis management firm to handle day-to-day operations while it attempted to reorganize. Over the next seven months, board members were told the hospital was making real progress, verified by reports showing apparent gains in admissions, physician support and nurse staffing.
But the picture was not nearly as rosy as the turnaround company’s CEO and CFO painted. Within hours of learning that payroll taxes had not been paid, board members met in emergency session and immediately terminated the contract with the turnaround company for cause. A week later, faced with stark financial numbers showing that the hospital could not survive, the board agreed to file for Chapter 7 insolvency and the hospital closed in August of 2003.
The hospital was demolished in 2007 and will be replaced with a public school after the Los Angeles Unified School District prevailed over a health care bidder for the property.
The school district paid $22.5 million for the 11-acre site at a Feb. 23 auction in U.S. Bankruptcy Court, beating out a $21.5 million bid from Namco Financial, a Pasadena real estate investment and financial firm that promised to reopen the hospital under a new operator.
The 155-bed community medical center filed for Chapter 11 bankruptcy protection in November 2002 following the failure of National Century Financial Enterprises, an Ohio-based factoring firm that bought receivables from hospitals at a discount, supplying them with a stable source of cash. Two executives with the-factoring firm have pleaded guilty to fraud in the failure.
In 1991 the Community Hospital in Granada Hills had to evacuate its top floors and treat people in the parking lot and in debris-strewn hallways. At the Granada Hills Community Hospital, a makeshift emergency room was set up in the parking lot. Nurses treated more than 1,000 patients there on Monday after the Northridge earthquake.
Date Established: 1965
Number of beds: 201 (144 Medical/Surgical, 16 Obstetrical, 18-bed Critical Care Unit, and 23-bed Transitional Care Unit)
* First hospital in the San Fernando Valley to perform open heart surgery and to establish freestanding surgery and laser centers.
* More than 2,000 heart surgeries performed.
* CARE services provided for more than 10,000 patients and family members.
* More than 31,000 babies born
Ranked as the 24th largest employer based in the Valley, (San Fernando Valley Business Journal, 7/96, based on number of employees).
Why it closed?
According to the report, between 1993 and 2003, 60 California hospitals closed because half their services became unpaid. Another 24 California hospitals verge on closure, the author writes. According to her study, 84 California hospitals are closing their doors as a direct result of the rising number of illegal aliens and their non-reimbursed tax on the system.
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