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To: Amots who wrote (61419)	9/13/1999 12:59:00 PM
From: Tim McCormick	Respond to of 86076

CMB is trustee on unsecured 300Mill. in Vencor chpt. 11 filing. Wilmington, Delaware, Sept. 13 (Bloomberg) -- Vencor Inc., a nursing home and hospital operator, filed for bankruptcy protection from creditors after changes in government payments led to falling revenue and losses. More than 100 of the company's units also filed a Chapter 11 petition with U.S. Bankruptcy Court in Wilmington, Delaware. Vencor listed $1.71 billion in assets and $1.4 billion in debts in court papers. Vencor said it's reached agreements for $100 million in financing from a bank group headed by Morgan Guaranty Trust Co. of New York, a unit of J.P. Morgan & Co. ''Filing for reorganization was necessary to enable us to create a sustainable capital structure while we continue to provide high-quality healthcare services,'' said the company's chairman, president and chief executive, Edward Kuntz, in a statement. Vencor also said it's working with the U.S. Justice Department to settle the government's pending claims against the company. The department is representing the federal Health Care Financing Administration and the Department of Health and Human Services. The Justice Department accused Vencor of Medicare fraud in a whistleblower lawsuit unsealed in May. Vencor and other nursing home operators have suffered from a change in the way the government determines payments from Medicare, the federal health plan for the elderly. Under the new system, mandated by the balanced budget law of 1997, nursing homes receive a fixed amount per patient, rather than being reimbursed for their costs. The company was one of the first in the U.S. to provide nursing home services under the new system. Nursing homes have said that the reimbursements aren't enough to keep up with costs, especially in cases involving patients with complicated illnesses. Louisville, Kentucky-based Vencor, which started implementing the new payment system in July 1998, lost $650.8 million, or $9.53 a share, last year and $64.1 million, or 92 cents, in the first half of this year. Among Vencor's largest unsecured creditors listed in court papers are Chase Manhattan Bank of New York, trustee for $300 million in senior subordinated notes; and Health Care Financing Administration of Mutual of Omaha Insurance Co., owed $82.3 million.