Cold Spring Hills Center for Nursing & Rehabilitation calls off closure plans after dozens of residents moved, workers laid off

Long Island's second-largest nursing home has reversed its plans to close after the labor union representing most of the employees at Cold Spring Hills Center for Nursing & Rehabilitation and the Woodbury facility's proposed buyer reached an agreement, court proceedings showed Wednesday.

A new plan to keep the nursing home open still requires approval from state health officials and the judge overseeing its federal bankruptcy case.

The surprise announcement during a hearing in the bankruptcy case came more than a week after health officials approved a closure plan. It also followed the transfers of about 77 residents to other long-term care facilities and the layoffs of about 150 employees in what had been a workforce of about 500.

It wasn't immediately clear Wednesday how the shift in plans would affect the residents who had been moved out or the workers who had lost their jobs.

Pending approvals, the modified labor agreement will allow proposed purchaser Eliezer Jay Zelman to become temporary receiver of Cold Spring Hills and eventually become the facility's owner, nursing home lawyer Schuyler Carroll said in a letter Tuesday to U.S. Bankruptcy Court Judge Sean H. Lane.

"This is particularly important because the debtor has just barely managed to fund payroll and other ongoing expenses — having been required to manage cash flow day by day," Carroll wrote in the letter. "Immediate approval of the sale and receivership will allow the debtor to avoid administrative insolvency."

Bent Philipson, Cold Spring Hills' primary owner, and his son, Avi Philipson, the business' managing member, have said in court papers they're incurring $625,000 in weekly losses and cannot afford to continue operating the facility.

A state Health Department spokeswoman said Wednesday officials are reviewing one application to rescind the 588-bed nursing home's closure plan, which it approved last month, and another application for Zelman to become Cold Spring Hill's temporary receiver and take over operations.

The department previously approved Zelman as temporary receiver but indicated Wednesday a second approval now would be needed. A decision on the applications isn't expected before the parties return to court on Monday.

'Deeply concerning'

The reversal of plans has created confusion and frustration, said Andrea Parker, 44, of Provincetown, Massachusetts, whose mother, Cathleen Parker, 75, lives at the nursing home.

The daughter said she still will try to relocate her mother, who has lived Cold Spring Hills since 2018, has dementia and can no longer feed herself.

But Parker, who said she has wanted to transfer her mother to a different facility for a long time, said she also is worried about the potential impact of such a change in surroundings.

Following a visit to Cold Spring Hills on Wednesday, Parker said her mother is the "thinnest I've ever seen her" and she's grown increasingly concerned about her care and nutritional health since plans to close the nursing home were announced.

Parker said her mother’s "acceptance is pending at another facility and if she gets in there I’m having her transferred immediately."

She added Cold Spring Hills has been "scrambling to get rid of people," saying: "That brought a little stress onto me, thinking time is of the essence here."

On Wednesday afternoon, ambulettes came and went from the front of the facility, as members of two other families also told Newsday they're making arrangements to relocate their loved ones.

Nursing home advocates said the entire process undoubtedly has traumatized the residents — many of whom are elderly and disabled.

"It is deeply concerning to think about what the residents who have been pushed out of this facility are now experiencing," said Richard Mollot, executive director of Manhattan-based Long Term Care Community Coalition, which advocates for nursing home residents. "How many are suffering unnecessarily — fear, confusion, missed medications or treatment — because the public trust was broken?"

Agreement 'in principle'

Newsday reported in February that Cold Spring Hills intended to close its doors no later than May 15 after talks over a modified labor agreement between Zelman and 1199SEIU United Healthcare Workers East fell apart following a week of negotiations. 

The central holdup, officials said at the time, was about worker health care.

Nursing home employees had insisted they be allowed to return to their union-operated health insurance plan and opt out of a privately run health plan put in place last year — a move Zelman rejected, a union attorney said in an email Newsday previously obtained. 

The details of the modified collective bargaining agreement the union now has agreed to weren't available Wednesday.

Union attorney Ryan Barbur confirmed during the court proceeding that the union and proposed owner had "reached an agreement in principle." He added: "Labor counsel for the union is drafting and reviewing that document as we speak."

Enid Stuart, special bankruptcy counsel at New York Attorney General Letitia James' office, represented the state Health Department in court Wednesday. She told the judge the proposed plan to save the facility came as a "surprise" and health officials needed time to assess the latest developments.

"The Department of Health is the regulator," Stuart said. "Their sole purpose here is to ensure the health and safety of the patients. There are, most importantly, questions that the department has to understand in terms of what is going to happen to the patients that have been moved."

David Hillman, an attorney representing Zelman — who owns three other nursing homes in New York — agreed during Wednesday's hearing there are many questions that cannot be answered until the labor deal is formalized in a memorandum of agreement and signed by the parties. 

"People ... need facts, and right now ... we don't have those facts yet," Hillman said.

Court records show Zelman previously agreed to purchase the nursing home for $10, although the agreement, which would require Health Department approval, called for him to take on $72 million in mortgage debt on the property.

More uncertainty

Hillman and Carroll said in interviews after Wednesday's hearing they didn't know how negotiations between the union and Zelman got restarted. The attorneys also said they didn't have information about what would happen with the residents who've already been moved out and the staff members who had lost their jobs.

Before residents began moving out last week, the nursing home's population had dipped to just under 300.

This isn't the first time Cold Spring Hills has been on the brink of closure, only to remain open. In December, Cold Springs Hills threatened an "emergency evacuation" of its residents, a Dec. 31 facility closure and the intent to lay off its entire workforce.

But on Dec. 20, Nassau State Supreme Court Justice Lisa Cairo granted a temporary restraining order James' office sought that blocked the discharge or transfer of residents and required the facility to remain operational.

The facility then filed for Chapter 11 bankruptcy protection on Jan. 2.

Cold Spring Hills has been in financial jeopardy for years, records show. In December 2022, a lawsuit from James' office alleged the nursing home neglected resident care and skirted state laws through a fraudulent business setup designed to enrich its owners.

In April, Cairo imposed a $2 million penalty as part of the lawsuit's resolution and appointed an independent health monitor for the facility.