The Hadassah women’s organization first noted the hospital’s deteriorating finances in 2008 and asked administrators to make changes. At the time, the executive vice president of the women’s organization, Barbara Goldstein, said the hospital had no idea which departments were making money and which were losing.
The women’s organization funds nearly all of the hospital’s research and development budget, including $250 million toward the construction of the Davidson tower. It funds 4 percent of the hospital’s daily operations budget, and over the years also has stepped in to cover deficits in the $570 million operating budget.
From 2000 to 2012, the organization gave $885 million to the hospital.
The 2008 recession and the Bernard Madoff Ponzi scheme, which cost the women’s organization tens of millions of dollars, hurt the group’s ability to funnel large sums to the hospital.
Goldstein told JTA that the women’s organization has appointed a representative to attend hospital board meetings in an effort to exercise greater oversight. But she also acknowledged that the organization’s willingness to make up for past budgetary shortfalls contributed to the current crisis.
“They always think we’ll always come through,” Goldstein said. “There were many times when a director-general called and said, ‘Maccabi owes us 20 million, can we borrow it from you?’ It’s like loaning money to kids.”
Unlike his predecessors, Kaplan is not a physician. He holds a doctorate in medical administration and previously served as the CEO of Israel Aircraft Industries. He told JTA that the key to resolving the crisis is cutting staff and salaries.
Goldstein predicted that Kaplan will have the hospital on a sound financial footing within five years. Hospital staffers understand that cuts will be a necessary part of the restructuring, she said.
“I don’t think they’ll strike again,” Goldstein said. “Either they’re going to survive and move forward, or there’s going to be nothing.”