A cash-strapped Long Island nursing home is threatening to shut its doors in a few months if its potential buyer and its workers fail to reach a labor deal “immediately.”
Cold Spring Hills Center for Nursing and Rehabilitation has notified the Department of Health that unless a new owner takes over, it plans to shut down by May 15 to eliminate growing financial losses, according to legal documents filed this week. The state has approved the nursing home’s new owner, but the sale has been delayed because the buyer has yet to reach a deal on pay and benefits with labor giant 1199SEIU, which represents the majority of the facility’s roughly 500 workers, legal filings say.
The union and the new buyer are scheduled to go back to the bargaining table with a mediator on Feb. 6. But if they can’t come to a deal quickly, Cold Spring Hills says it will have no choice but to close its doors, according to a letter the nursing home sent Wednesday to the mediator.
“I cannot overstate the importance of reaching an immediate agreement,” Martin Cauz, the nursing home’s chief restructuring officer, said in the letter, which was obtained by Crain’s. Cauz said the closure of Cold Spring Hills would force relocation of more than 300 residents and terminate 500 workers, adding that the sale was the “only viable strategy” to save the company and avoid disruption.
The labor talks come nearly a month after Cold Spring Hills filed for chapter 11 bankruptcy to settle more than $50 million in debt. The facility’s owners, nursing home magnates Bent Philipson and his son, Avi, say they’ve lost money because of a sprawling state fraud investigation as well as declining patient admissions. Attorney General Letitia James brought a lawsuit against the nursing home in December 2022 for shady business practices and patient harm, leading a judge to appoint oversight bodies for the home’s finances and patient care operations.
Now, the facility is losing $625,000 a week and expects to run out of money by Feb. 10, court documents show.
Cold Spring Hills sought out a buyer last year to take over its ailing facility. The Health Department approved Eliezer Jay Zelman, who owns a handful of other nursing homes in New York, as the receiver on Jan. 23, according to court documents. But Zelman’s company has not reached a deal on wages and benefits with the union.
“The caregivers at Cold Spring Hills have continued to provide outstanding care to residents despite the owner’s refusal to meet their obligations, including for the workers’ contractually required health benefits,” 1199SEIU President George Gresham said in a statement. The union will continue to meet with the potential buyer to reach a deal that will offer “good wages and benefits and ensure stability in the workforce,” he added.
