The closure of Hahnemann University Hospital last summer disrupted the lives of thousands who lost jobs there, but a separate, potentially career-altering threat looms for nearly 1,000 medical residents who trained there during the 18 months that California businessman Joel Freedman was running the Philadelphia hospital, the Philadelphia Inquirer reported. The bankrupt hospital has not agreed to buy medical malpractice insurance for residents and fellows that would cover the doctors into the future for incidents while they worked at the hospital. The cost of buying the insurance on their own “ranges from prohibitive at best to impossible depending on their specialties," according to a filing last week by the Ad Hoc Committee of Hahnemann Residents and Fellows. U.S. Bankruptcy Judge Kevin Gross scheduled a hearing for today in Wilmington, Del., at which he will gather evidence on whether the bankruptcies should be converted to a liquidation as opposed to a reorganization. In his order, Gross cited the failure of the bankrupt companies to buy the insurance sought by the residents and their advocates. According to U.S. bankruptcy law, “failure to maintain appropriate insurance that poses a risk to the estate or to the public” provides grounds for converting the case to a chapter 7 liquidation from a chapter 11 reorganization.
