Cold Spring Hills Center for Nursing & Rehabilitation will close May 15 unless a new agreement is reached with labor union, records show

The financially troubled Cold Spring Hills Center for Nursing & Rehabilitation has told the state Health Department it plans to close its doors as early as May 15, unless the facility’s proposed new operator reaches a modified collective bargaining agreement with the labor union representing the nursing home’s nearly 500 employees, court records show.

The move comes after Cold Spring Hills, Long Island’s second largest nursing home, last month sought bankruptcy protection and appears to have found an operator willing to take over — and ultimately purchase — the Woodbury facility.

Court records filed Monday in the nursing home’s bankruptcy case indicate the state Health Department on Jan. 23 approved Eliezer Jay Zelman, who owns three other nursing homes in the state, as the facility’s temporary receiver. Zelman would take over operations and payroll obligations.

Zelman also submitted an application to the department seeking to purchase the facility for $10, although the agreement calls for him to take on $72 million in mortgage debt on the property.

But court records stipulate that Zelman has informed Bent Philipson, Cold Spring Hills’ primary owner, and his son, Avi Philipson, the business’ managing member, that he will not move forward with the receivership until he receives a modified collective bargaining agreement with 1199SEIU United Healthcare Workers East, which represents most of the facility’s employees.

Schuyler Carroll, an attorney for Cold Spring Hills, said the Philipsons are incurring about $625,000 in losses per week and are expected to run out of money by Feb. 10.

“Closing the facility is in the estate’s best interest due to the substantial losses being incurred on a daily basis to operate the facility,” Carroll wrote in a Jan. 31 court filing. “As much as the debtor wants to consummate the receivership and sale, it is no longer certain whether that will happen and it depends on events entirely outside of the debtor’s control. The debtor simply cannot continue incurring these losses and, therefore, must proceed to obtain approval of the closure plan as an alternative.”

Barring a modified agreement — the two sides are scheduled for mediation on Thursday — the nursing home would shutter its doors on May 15, records show. All remaining residents would be relocated to alternative long-term care facilities. The facility is down to 299 residents and another 65 enrolled in an Adult Day Health Care program.

In a statement, 1199SEIU President George Gresham said the union continues to work toward an agreement.

“The caregivers at Cold Spring Hills have continued to provide outstanding care to residents despite the owner’s refusal to meet their obligations, including for the workers’ contractually required health benefits,” Gresham said. “We continue to meet with a potential buyer to reach an agreement that will provide good wages and benefits and ensure stability in the workforce which is essential to providing proper resident care.”

In Jan. 24 court paperwork, the union said it has discussed modifications to the bargaining agreement with Zelman, but that he wants “to eliminate all scheduled wage increases and drastically slash benefits,” including adopting a more expensive employee-funded health insurance plan.

In addition, Zelman wants to remove positions from the bargaining unit, the union said, including registered nurses, physical therapists, physical therapy assistants, occupational therapists, certified occupational therapy assistants, respiratory therapists, respiratory technicians and dietitians.

Carroll said the nursing home submitted a closure plan to the State Department of Health, which must still approve the plan, on Jan. 31. A department spokeswoman did not immediately respond to a request for comment.

“The closure plan calls for personnel at the facility to use their best efforts to provide each resident/registrant with at least three alternative providers, and to assist each resident in identifying appropriate alternate placement,” he wrote. “Pursuant to the closure plan, if at all possible, each resident will be transferred to the facility of resident’s choice.”

The facility has submitted an application asking U.S. Bankruptcy Judge Sean H. Lane, who is overseeing the nursing home’s case, to sign off on the closure plan during a Tuesday afternoon hearing.

This is not the first time Cold Spring Hills has announced plans to close its doors.

The facility first asked the Department of Health for approval to close on April 23, 2024 but elected not to proceed with the plan, instead seeking instead to find a new operator and buyer. At the time, the 588-bed facility had seen its resident census drop to 423.

In late December, with the facility buried in debt, unwilling to take on new residents and requiring $15 million in upgrades, the nursing home announced plans for an “emergency evacuation” of its residents only days before Christmas and Hanukkah. The plan called for the nursing home to close its doors on Dec. 31 and to lay off its entire workforce.

On Dec. 20, Nassau State Supreme Court Justice Lisa Cairo issued a temporary restraining order sought by state Attorney General Letitia James, blocking the nursing home from discharging or transferring its residents and ordering the facility to remain operational.

Days later, Cold Spring Hills, struggling to meet its $1.4 million weekly payroll, filed for Chapter 11 bankruptcy protection from its creditors.

The attorney general’s office declined to comment on the most recent closure plan.

Cold Spring Hills has been in financial peril for years, records show. In December 2022, a lawsuit from James’ office charged that 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.

Check back for updates on this developing story.

Robert Brodsky is a breaking news reporter who has worked at Newsday since 2011. He is a Queens College and American University alum.