Northern Berkshire Healthcare Reports Less than $1M in Assets
NORTH ADAMS, Mass. — Northern Berkshire Healthcare's petition for Chapter 7 bankruptcy declares it has between $500,000 and $1 million left in assets, but owes up to $50 million.
Hearings on the bankruptcy proceedings for the health care system and its subsidiary, Northern Berkshire Healthcare Physicians Group, are set for Monday, April 7, at 3 p.m. in the Federal Courthouse in Springfield.
The board voted unanimously on April 2 to file Chapter 7, which allows an appointed bankruptcy trustee to sell of assets to pay the claims of creditors.
The case is being heard by Judge Henry J. Boroff.
On Thursday, the federal bankruptcy court assigned Harold B. Murphy of Murphy & King PC of Boston as an interim trustee to preside over the initial hearing of creditors in the U.S. Trustee's office on May 15.
Olga L. Gordon of Murtha Cullina LLP in Boston was hired as counsel at a cost of $18,666.67.
Northern Berkshire Healthcare closed abruptly last month, shutting down North Adams Regional Hospital on Friday, March 28, and its physician practices last week. The health-care system had been in talks for some time with Berkshire Health Systems based in Pittsfield for a merger or affiliation. The negotiations broke down when an agreement could not be reached between BHS and bondholders for NBH's debt, prompting the board of trustees to vote to close when it could not make payroll for the coming week.
The filings in Thursday's bankruptcy notice included the top 20 unsecured creditors for each nonprofit organization. The total number of creditors is between 200 and 999.
According to the filing, the health care system estimates that once exempt property and administrative expenses are excluded, "there will be no funds available for distribution to unsecured creditors."
NBH owes the most in unsecured claims to Berkshire Health Systems, at about $1.8 million; it also owes more than $600,000 to two Pension Benefit Guarantee accounts and another $129,000 to the NBH Plan Trust.
Other creditors range from Wells Fargo Bank ($71,882) to Margulies Peruzzi Architects Inc. of Boston ($64,843).
Northern Berkshire Healthcare Physicians Group lists the same assets and liabilities, but a much lower amount in unsecured debt. It owes the most, $20,000, to Berkshire Surgical Associates and the least, $424.98, to WB Mason Co.
There are, however, numerous other creditors for both organizations, including a significant amount of bonding debt for Northern Berkshire Healthcare that has been estimated between $20 million and $40 million.
In 2011, the health group failed to make payments on some $43 million in bonds issued for expansion and for renovations on the North Adams Regional Hospital campus in the decade before.
In August 2012, not long after re-emerging from Chapter 11 reorganization, some $36 million in bonds were issued through the Massachusetts Development & Finance Agency and Wells Fargo Bank, National Association, to replace the older bonds and backdated for interest to June that year.
Tags: bankruptcy, NARH, NBH,
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