Why Getting Sick at St. Vincent's Hospital In New York City May Be Hazardous To Your Wealth

Did you know that getting sick and going to a hospital that has declared bankruptcy may be hazardous to your wealth? It's true.

Here's why: In cases where you are injured by a doctor or hospital, your only recourse is to bring a lawsuit to recover compensation for your injuries.

When the hospital has declared bankruptcy, it is impossible to bring a lawsuit against the hospital until the bankruptcy proceeding has been completed. Declaring bankruptcy means that the hospital does not have enough money to pay their bills; similar to a personal bankruptcy. Where a hospital is self-insured, which means that they do not buy malpractice insurance from an outside company to pay any judgments or settlements arising out of a lawsuit against them. Instead, they set up a fund (where they are self-funded) and set aside money in the event they have to pay out money for any lawsuits; both accident cases and medical malpractice cases.

In a bankrupcty proceeding, the bankruptcy court will try to work with the parties to re-structure the debt that is owed to the many creditors. In many bankruptcy cases involving a self-insured hospital, there may be no money left over to pay any judgment or settlement as a result of any injuries you suffered by that hospital.

Here's what you need to know if you've been the victim of wrongdoing by a hospital, like St. Vincent hospital in New York City that has declared bankruptcy:

1. You must file a claim within the specific time period required by the bankruptcy court.

When you file that claim, you are then listed as an unsecured creditor of the bankruptcy estate. This is legal-speak meaning that you are at the bottom of the barrel when it comes to getting paid for your injuries. In a bankruptcy proceeding, secured creditors are paid first. These are people with specific agreements with the hospital that demand they be paid first. Whatever money is left over is then used to pay "unsecured creditors" such as injured patients. Nice, isn't it?

Unsecured creditors are paid only after everyone else has been paid first. This means that whatever money is left over must now be distributed to the remaining people who are owed money by the hospital.

In reality, that means that if you are owed $1000, you'll probably receive 10 cents on the dollar, which means you'll probably wind up with $10 in your pocket after two years worth of litigation. The practical reality is that most experienced New York accident or medical malpractice attorneys will refuse to accept a case knowing that a patient has been harmed at a hospital that is currently in bankruptcy. That's not to say they won't; only that it's difficult to convince an attorney to take a case, knowing that there is a chance that you, their client, will receive very little, compared to what you should be entitled to receive if there were no bankruptcy.

The bottom line is that if you suffered injury as a result of improper medical care and treatment at a bankrupt hospital, it will be extremely difficult, if not impossible for you to get full and fair compensation for your injuries New York. Beware of going to a hospital for medical treatment that is known to be in bankruptcy.