The U.S. Bankruptcy Court for the District of New Jersey has approved a $5 million financing agreement for five Connecticut nursing homes that will allow the facilities to continue providing quality patient care during their Chapter 11 reorganization, HealthBridge Management LLC announced. HealthBridge, which manages but does not own the facilities, also said the Court approved an extension of interim modifications to the facilities' collective bargaining agreements.

"The approval of these two motions ensures that these valuable community resources will be able to carry on their vital work of caring for their elderly residents," said Lisa Crutchfield , Senior Vice President, Labor Relations, for HealthBridge Management.  "The new financing gives the nursing homes the financial stability to reorganize and emerge from Chapter 11 as a more vibrant group of facilities that will continue to serve residents for many years."

The financing, known as a debtor-in-possession financing, is being provided by Capital One and ensures timely payment to the nursing homes' vendors and employees during the reorganization. Each of the five facilities is a sub-acute and long-term nursing care home for the elderly in Connecticut.  The facilities are: Long Ridge of Stamford, Newington Health Care Center, Westport Health Care Center, West River Health Care Center, and Danbury Health Care Center.

The facilities filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code on Feb. 24 in order to reorganize and implement plans to create competitive and durable cost structures.  The nursing homes' plans include gaining relief from unsustainable union pension and medical benefits costs and other restrictive provisions in the union labor agreements that hamstring the facilities' flexibility.

The five nursing homes provide long-term care and short-term rehabilitation services.