The victim of financial calamity, Northern Berkshire Healthcare, the parent company of North Adams Regional Hospital, is shut down.
As part of that move, the company soon will file for Chapter 7 bankruptcy, just two years after emerging from Chapter 11 bankruptcy protection, which allowed it to hit a financial "reset" button with creditors by restructuring its debt payments.
But what will Chapter 7 allow Northern Berkshire Healthcare to do?
According to Pittsfield attorney Richard Isacoff, Chapter 7 will allow the company to liquidate its assets, such as equipment and facilities. After a judge grants the provision, a trustee would be appointed by the state to oversee the dispersal of those assets, the voiding of certain contracts, and the payments to creditors.
For Northern Berkshire Healthcare, "It’s going to be a very expensive bankruptcy," Isacoff said. "It’s going to be a mess."
While the hospital might be insolvent on its balance sheets due to its debt, the hospital should still have money coming in through insurance companies, Medicaid and Medicare reimbursements and other avenues, Isacoff said.