Talk of closure comes a week after state Comptroller Tom DiNapoli issued a "scathing" audit saying that SUNY Downstate was on the verge of bankruptcy. The report said SUNY Downstate's decision to absorb LICH a colossal financial mistake.
As far back as 2008, doctors accused the hospital’s parent body -- which was at that time Continuum Health Partners -- of financial mismanagement and leaving the hospital in a precarious position.
According to the Brooklyn Eagle:
"While the audit said SUNY Downstate assumed both assets and “substantial” liabilities from LICH, Downstate President Williams asserted that LICH’s assets were higher than previously estimated – from "$280 million to $550 million," reports Crain’s New York.
Further, SUNY won’t be responsible for about $140 million worth of potential LICH medical malpractice claims. A trust set up from LICH endowment funds will cover those payments.
Also, according to DiNapoli’s report, $32.7 million was transferred from LICH’s accounts to SUNY's “Health Science Center at Brooklyn Foundation, Inc.” a not-for-profit corporation. (We notice the management fees for this foundation in 2011 alone are almost $6 million.)
This brings us back to 2008, when it was Continuum who was draining LICH of resources. Dr. Arnold Licht president of LICH medical staff, charged at that time: “Continuum has refused to account for money it has ‘borrowed’ from LICH’s endowment, for millions from the sale of LICH’s property, and even for bills it has imposed on LICH.”
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