Cold Spring Hills nursing home gets court-approved temporary receiver, keeping facility open
Cold Spring Hills Center for Nursing & Rehabilitation in Woodbury. Credit: Newsday / Steve Pfost
Long Island's second-largest nursing home will remain open after a bankruptcy judge Thursday approved a temporary receiver to run Cold Spring Hills Center for Nursing & Rehabilitation, with the expectation that the new operator will purchase the Woodbury facility.
The move came after 1199SEIU United Healthcare Workers East, the labor union representing Cold Spring Hills employees, finalized a modified labor agreement with Eliezer Jay Zelman, the nursing home's new receiver.
Zelman, who owns three other nursing homes statewide, previously said he would not move forward with the deal without the modified collective bargaining agreement with the union.
The state Health Department must still approve Zelman's application to purchase the facility for $10, although the agreement requires him to take on $72 million in mortgage debt on the property.
The developments, which were disclosed during a hearing Thursday in the nursing home's bankruptcy case, add a level of finality to Cold Spring Hills' yearslong saga, in which officials for the financially struggling Woodbury facility announced on three occasions in the past year that they would shutter its doors — only to reverse themselves.
As a result of the most recent closure plan, which was announced in February and has since been abandoned, the 588-bed nursing home had seen its resident population drop from just under 300 down to 188, court records show. Meanwhile, roughly 150 of the nursing home's 490 employees were terminated before the closure order was rescinded, records show.
It was not clear Thursday if the residents who were moved to other long-term facilities or the workers who lost their jobs would return to Cold Spring Hills.
U.S. Bankruptcy Judge Sean H. Lane approved a pair of motions on Thursday.
The first allows Zelman, who did not respond to requests for comment Thursday, to become the facility's temporary receiver — a move the state Health Department already approved. The second motion allows Zelman to buy the facility, pending department approval.
"Approval of these two motions will allow the facility to reinvigorate itself," nursing home lawyer Schuyler Carroll said Thursday. "The goal of the receiver and the buyer is to put in significant capital expenses, make significant improvements and allow the facility to once again be occupied at full capacity."
David Hillman, an attorney representing Zelman, said it will likely take two weeks to fully transition to Zelman as the facility's receiver.
"What I can say clearly and unambiguously is the receiver is going to take this transition and patient care very seriously and with utmost importance," Hillman said.
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.
Enid Stuart, special bankruptcy counsel at New York Attorney General Letitia James' office, expressed relief the nursing home would remain open.
"We are dealing with a vulnerable population," Stuart said. "DOH's role here is to ensure the health, welfare and safety of that population, and with the documents that we have, we're ready to proceed."
The Health Department is "reviewing the information" from Thursday's hearing and declined additional comment, said agency spokeswoman Erin Clary.
Newsday reported in February that Cold Spring Hills intended to close no later than May 15 after talks over a modified labor agreement between Zelman and the union 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.
Details of the modified labor agreement were not made available. A union spokeswoman did not respond to requests for comment.
In December, Cold Springs Hills threatened an "emergency evacuation" of its residents, and the intent to lay off its entire workforce and close its doors on Dec. 31.
But on Dec. 20, Nassau state Supreme Court Justice Lisa Cairo granted a temporary restraining order sought by James' office 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.
Long Island's second-largest nursing home will remain open after a bankruptcy judge Thursday approved a temporary receiver to run Cold Spring Hills Center for Nursing & Rehabilitation, with the expectation that the new operator will purchase the Woodbury facility.
The move came after 1199SEIU United Healthcare Workers East, the labor union representing Cold Spring Hills employees, finalized a modified labor agreement with Eliezer Jay Zelman, the nursing home's new receiver.
Zelman, who owns three other nursing homes statewide, previously said he would not move forward with the deal without the modified collective bargaining agreement with the union.
The state Health Department must still approve Zelman's application to purchase the facility for $10, although the agreement requires him to take on $72 million in mortgage debt on the property.
The developments, which were disclosed during a hearing Thursday in the nursing home's bankruptcy case, add a level of finality to Cold Spring Hills' yearslong saga, in which officials for the financially struggling Woodbury facility announced on three occasions in the past year that they would shutter its doors — only to reverse themselves.
As a result of the most recent closure plan, which was announced in February and has since been abandoned, the 588-bed nursing home had seen its resident population drop from just under 300 down to 188, court records show. Meanwhile, roughly 150 of the nursing home's 490 employees were terminated before the closure order was rescinded, records show.
It was not clear Thursday if the residents who were moved to other long-term facilities or the workers who lost their jobs would return to Cold Spring Hills.
U.S. Bankruptcy Judge Sean H. Lane approved a pair of motions on Thursday.
The first allows Zelman, who did not respond to requests for comment Thursday, to become the facility's temporary receiver — a move the state Health Department already approved. The second motion allows Zelman to buy the facility, pending department approval.
"Approval of these two motions will allow the facility to reinvigorate itself," nursing home lawyer Schuyler Carroll said Thursday. "The goal of the receiver and the buyer is to put in significant capital expenses, make significant improvements and allow the facility to once again be occupied at full capacity."
David Hillman, an attorney representing Zelman, said it will likely take two weeks to fully transition to Zelman as the facility's receiver.
"What I can say clearly and unambiguously is the receiver is going to take this transition and patient care very seriously and with utmost importance," Hillman said.
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.
Enid Stuart, special bankruptcy counsel at New York Attorney General Letitia James' office, expressed relief the nursing home would remain open.
"We are dealing with a vulnerable population," Stuart said. "DOH's role here is to ensure the health, welfare and safety of that population, and with the documents that we have, we're ready to proceed."
The Health Department is "reviewing the information" from Thursday's hearing and declined additional comment, said agency spokeswoman Erin Clary.
Newsday reported in February that Cold Spring Hills intended to close no later than May 15 after talks over a modified labor agreement between Zelman and the union 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.
Details of the modified labor agreement were not made available. A union spokeswoman did not respond to requests for comment.
In December, Cold Springs Hills threatened an "emergency evacuation" of its residents, and the intent to lay off its entire workforce and close its doors on Dec. 31.
But on Dec. 20, Nassau state Supreme Court Justice Lisa Cairo granted a temporary restraining order sought by James' office 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.
Robert Brodsky is a breaking news reporter who has worked at Newsday since 2011. He is a Queens College and American University alum.
NewsdayTV celebrates Women's History Month From a civil rights pioneer to history being made at the SCPD, NewsdayTV is celebrating Women's History Month with a look at changemakers and trailblazers with ties to LI.
Top Stories
NewsdayTV celebrates Women's History Month From a civil rights pioneer to history being made at the SCPD, NewsdayTV is celebrating Women's History Month with a look at changemakers and trailblazers with ties to LI.
