Salvation may be on horizon as Peninsula plans to shutter

A representative from a Chicago-based hospital group is drumming up support to save Peninsula Hospital as the Far Rockaway facility plans to close its doors Friday.
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As Peninsula Hospital made final arrangements to shutter its doors, a possible savior for the embattled Far Rockaway facility was touching down on the other end of Queens.

A representative at Peninsula said Tuesday the hospital’s clinics would remain open and the emergency room would be accepting walk-in patients until Friday.

As the Rockaway’s 100,000 residents braced for what many characterized as a health-care crisis, the president of a Chicago-based group with intentions of taking over and rehabilitating the hospital was landing at LaGuardia Airport.

Dr. Seth Guterman, of the People’s Choice Hospital group, said if he could convince Peninsula’s court-appointed bankruptcy trustee, Lori Lapin Jones, to re-evaluate her decision to close the facility, his organization could have it up and running within a matter of weeks.

“I’m confident that we could have it reopened in eight weeks, and assuming we get through all the due diligence of the bankruptcy court, from the moment we take over we could open the lab in six months with all the latest technology and be completely paperless,” he said.

Peninsula filed for bankruptcy protection last year after it had accumulated $13 million in debt. In February, the state Department of Health shut down the hospital’s lab after an inspection noted 66 “serious deficienci­es.”

In early March, a judge appointed Jones as the hospital’s bankruptcy trustee, and last week she filed bankruptcy documents noting it would take months to get the lab back up to snuff.

Guterman said his group has 12 years of experience revamping troubled hospitals, and he has a three-pronged plan to get Peninsula back online.

The first, he said, is the People’s Choice financing arm, which can offer reasonable interest rates to pump some much-needed cash into the hospital. The second arm is an experienced management team and the third is $10 million worth of health care IT resources at the group’s disposal, according to Guterman.

“I cannot overstress the importance of the technology component,” he said. “The technology will dramatically improve efficiency. We can apply the appropriate software and with a reasonable operating budget, we can make Peninsula look like a 21st-century hospital.”

The challenge, Guterman said, would be convincing Jones to give Peninsula another chance.

“One person wields enormous power in bankruptcy. Unfortunately, in the legal system, the one responsibility is to the creditors. The court has zero responsibility to the patients, the citizens or the community,” he said.

Jones did not return a request for comment.

Guterman noted that as the trustee, Jones stands to receive 3 percent of every $1 million she can recoup for creditors, and he questioned whether her plans to meet with him were made in good faith.

State Assemblyman Phil Goldfeder (D-Rockaway Beach) said he had not had any luck reaching out to Jones.

“She hasn’t returned any of my phone calls. Hopefully, we can exert some pressure and someone can hold her feet to the fire,” he said, adding Peninsula had submitted its closure plan to state officials. “Nothing is final until its final.”

Reach reporter Rich Bockmann by e-mail at or by phone at 718-260-4574.

Posted 5:05 pm, April 4, 2012
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