Grant Hospital in Lincoln Park and Edgewater Hospital in Edgewater announced Monday that they will sell their facilities to a south suburban cardiovascular surgeon and a medical finance company. The two North Side hospitals are reportedly losing money and do not have the capital for needed expansion.
Edgewater Hospital, 5700 N. Ashland Ave., also had two of its staffers plead guilty to federal racketeering charges on Oct. 1 for their role in alleged health care fraud. Grant Hospital, 550 W. Webster Ave., has not been linked in anyway to the fraud charges at Edgewater Hospital.
The terms of the sale have not yet been disclosed and the sale must be reviewed by the Illinois Health Facilities Planning Board before a sale can be executed.
Both Grant and Edgewater hospitals have had management problems of late with Indiana-based Bainbridge Management LP, which was fired in May by the facilities’ board of directors, being the most recent. Shortly after Bainbridge was fired federal indictments were announced relating to hospital management and physicians at Edgewater defrauding government and private insurance companies of more than $5 million over the last ten years. One administrator and three physicians pleaded guilty to the charges last week, while Bainbridge Management has pleaded not guilty and is now waiting for a trial date. Last week a fourth Edgewater physician was charged.
The charges allege that Bainbridge kicked back money to physicians who admitted patients to Edgewater who were not in need of medical services.
Media reports state that Vital Community Health Services, which replaced Bainbridge Management, said the sale was intended to return the for-profit Edgewater Hospital to being a respected provider of medical services. The two partners in the buyout are reported to be Dr. Abel Garibaldi, a Homewood cardiovascular surgeon, and GSI Securitization, Inc. of New Jersey.
Neighbors in both Lincoln Park and Edgewater have long wondered if both hospitals’ underlying real estate values may not some day be their undoing. Columbus Hospital in Lincoln Park closed just last week and its real estate is now in play as a proposed residential development. Both hospitals are located in highly competitive health care market areas where other competing providers struggle for profitability.
Printable Version