Court Steps In to Restore Order in Hadassah Hospital Crisis

Hadassah Ein-Kerem Hospital on Tuesday, with a sign indicating the hospital was closed. (Yonatan Sindel/Flash90)
Hadassah Ein-Kerem Hospital on Tuesday, with a sign indicating the hospital was closed. (Yonatan Sindel/Flash90)

The Yerushalayim District Court began imposing order on the chaotic affairs of the bankrupt, strike-hobbled Hadassah Medical Organization on Tuesday, freezing its debts and appointing trustees to help put things back together.

Hadassah doctors withdrew their threat to walk off the wards if malpractice insurance was not settled, after they received the policies for review, also following a court directive. Hadassah has been running on a limited schedule, handling mostly emergencies.

The Court ruling was issued amid the ongoing tumult of protests and work sanctions that swept hospitals across the country for two hours on Tuesday morning as medical staff for the second time stopped work to show their solidarity with employees at Hadassah’s two hospitals, in Ein Kerem and Mount Scopus, who have received only half of their pay for January.

According to the ruling, the current hospital management will retain authority over the hospitals’ affairs, but trustees were appointed to help rehabilitate the hospital’s finances. Creditors will be put off for 90 days.

Negotiations on the hospital’s recovery plan will begin in a few days. The hospital will receive a NIS 50 million grant from the government and NIS 50 million from Hadassah Women’s Zionist Organization of America, according to Globes.

Meanwhile, the other major hospital in Yerushalayim, Shaare Zedek Medical Center, was receiving more patients than usual due to the partial sanctions at HMO. With Hadassah’s problems, Prof. Jonathan Halevy, SZMC’s director, said the patient load was up by 15-20% and that it had bolstered its staff to cope with the crisis.

At the court hearing on Monday, it emerged that the hospitals’ biggest creditors by far are their employees. Some 70% of Hadassah’s NIS 1.3 billion debt, or NIS 917 million, was owed to employees.

Hadassah CEO Avigdor Kaplan told the court, “It is possible to cure Hadassah and bring it to safe haven, but both parties — the government and the workers — must dig into their pockets.” He promised “to do everything to save Hadassah, with all its 54 years experience. I will try not to disappoint this time too.”

Hadassah Hospital, with the backing of the Ministries of Finance and Health, is seeking to fire scores of administrative and support staff, cancel benefits included in collective labor contracts, make across-the-board and differential pay cuts to doctors and employees, rein in private healthcare services, limit doctors’ private practice to the afternoon, and raise the hospital’s take from these services from 15% to 40%.

Opposition leader Isaac Herzog (Labor) said in a statement that “It’s impossible that the workers should pay the price, that those who get up at 4 a.m. and wash the bathrooms should pay the price [along with] nurses and doctors.”

Herzog said he was “worried” by what Health Minister Yael German had said about the  crisis. “She said ‘there will be dismissals,’ but I say there will not be dismissals,” the MK declared. “I fear that human lives will be lost if the government does not allocate money to the hospital.”

The Hadassah Women’s Zionist Organization of America (HWZOA), which owns HMO, issued a statement from New York saying that the decision to file for restructuring was a “difficult moment.”

“For over a century, HMO has been a world-leading medical center serving the people of Israel,” the statement said. “While HMO has achieved so many wonderful things, today it faces a fiscal crisis that allows for no other solution than an organized restructuring process.”

In an apparent rejoinder to Israeli Prime Minister Binyamin Netanyahu’s statement on Monday that HMO’s problems were the result of managerial failure, HWZOA national president Marcie Natan said that similar to the financial crisis that faced the American auto industry, Hadassah’s problems had “no single root cause.”

“This crisis is the result of dynamics that have been building for years, including unsustainably low reimbursement rates for services; unaffordable union contracts; and unrealistic commitments to the university that trains their students and conducts research at HMO facilities,” Natan said. “We will do our part to help see HMO through the restructuring process. It is our expectation that HMO’s other stakeholders — the government of Israel, the unions, the university, and the hospitals’ creditors and suppliers — will join us in that effort.”

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