SYRACUSE, New York (WWNY) – North Star Health Alliance faces a significant shortfall in cash and needs urgent help, with a last-minute court date set for Thursday.
North Star filed for Chapter 11 bankruptcy on Tuesday, saying it did so to protect the services it provides and keep its 1,600 people on the job. But the hospital group doesn’t have the cash to make payroll next week.
So North Star will be in federal bankruptcy court in Syracuse on Thursday at noon, asking a judge to let it use a pot of money that is held as security for its lenders.
Court documents filed by North Star say that without the ability to tap this cash, employees won’t get paid next week, and its hospitals and medical care operations are likely to close.
The documents show North Star is $2.5 million short for next week’s payroll, although that number can improve as revenue comes in over the next several days.
Since North Star lost state funding in December, it has made payroll and twice needed state help. But it has made its $5.5 million payroll. (That payroll amount was with 1700 workers, and a figure provided before North Star laid off 120 people in January. It now has 1600 workers.)
All of North Star’s hospitals and facilities are open as it files for chapter 11.
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