May 30 (Reuters) - Sound Shore Health System Inc of suburban New York City filed for Chapter 11 bankruptcy, blaming government spending cuts, and plans to sell its business to Montefiore Medical Center for $54 million.
The company provides healthcare services through its Sound Shore Medical Center of Westchester, Mount Vernon Hospital Inc and a nursing home and extended care facility.
Sound Shore said it was struggling due to cuts in government spending.
“As is true with many community hospitals serving a working-class constituency, the Medical Centers have been beset by the financial pressures caused by cuts in Medicare and Medicaid funding,” the company said in documents filed in Manhattan’s U.S. Bankruptcy Court on Wednesday.
The company said it had assets worth $159.6 million at the end of last year and liabilities of approximately $200 million. The company reported 2012 revenue of $241.8 million.
Bankruptcy lawyers and advisers have said they expect a wave of restructuring among healthcare providers as governments look to rein in their medical spending.
Earlier this month KidsPeace Corp of Pennsylvania, which operates a psychiatric hospital, filed for bankruptcy and also blaming cuts in Medicaid.