The Motion Picture & Television Fund -- a charity started by Charlie Chaplin, Mary Pickford and other Hollywood luminaries to care for entertainers who fell on hard times -- said Wednesday that it was closing a hospital and nursing home by year's end.
With more than 500 hospital admissions last year and about 100 long-term residents, the Woodland Hills facilities have been a $10-million annual drain on the fund's budget for the last four years. The fund administrators projected the shortfall would only grow as a result of the deteriorating economy.
The origins of the "motion picture home," as it is commonly referred to by people in the entertainment industry, date to 1940, when actor Jean Hersholt, who played Shirley Temple's grandfather in the film "Heidi," planted 48 acres of walnut and orange trees in Woodland Hills on the site of the future Motion Picture & Television Country House and Hospital, opened eight years later.
Residents have included DeForest Kelley, who played Dr. Leonard "Bones" McCoy on "Star Trek"; Dick Wilson, of Mr. Whipple fame; and producer-director Stanley Kramer, whose credits include "High Noon" and "Judgment at Nuremberg." He died there in 2001 at 87.
The closures, which will cost 290 workers their jobs, will not affect about 185 residents of the fund's independent- and assisted-living facilities and six area health centers that serve some 60,000 industry workers.
Founded in 1921 with the motto "We take care of our own," the fund began with a coin box in Hollywood into which industry workers deposited spare change. It grew into one of Hollywood's favorite charities, with a $120-million annual budget.
But even modern-day Hollywood's biggest names couldn't script a happy ending for the hospital and home. DreamWorks Animation SKG chief Jeffrey Katzenberg, filmmaker Steven Spielberg and stars such as Jennifer Aniston, Katie Holmes, Tom Cruise, Angelina Jolie, Brad Pitt and Reese Witherspoon each year host an annual pre-Oscar fundraiser bash at the Beverly Hills Hotel for the home.
Katzenberg, chairman of the MPTF Foundation Board, said the fund concluded that it had no choice: "Although we are in good shape today, the acute-care hospital and long-term-care facility are generating operating deficits that could bankrupt MPTF in a very few years."
The decision wasn't getting great reviews Wednesday.
"This is a very sad moment for an important institution, which has been part of the golden and final years of so many working people in Hollywood, both famous and not so famous," said Martin Kaplan, Norman Lear professor at USC's Annenberg School for Communication.
Hollywood historian Marc Wanamaker said the decision flew in the face of the fund's mission. "They have many members that are worth 100 million bucks each. Why can't they give a little more to close that deficit?"
The fund's high-profile fundraising generates $12 million to $15 million a year, fund Chief Executive David Tillman said. The pre-Oscar bash, with sponsors such as Target Corp., typically raises $6 million to $7 million alone.
But fundraising was not enough to cover the hospital and home shortfall, plus millions more the fund spends annually on direct financial assistance to needy entertainers, Tillman said.
Katzenberg and Spielberg are both major donors to the fund. Both men were victims of the alleged $50-billion fraud run by New York money manager Bernard Madoff. Spielberg's Wunderkinder Foundation was among some 400 U.S. nonprofit groups that invested with Madoff. Wunderkinder contributed $77,000 in 2007 to the motion picture fund.
Tillman said the decision to close the facilities was made in October, well before the Madoff scandal hit. The fund itself did not make any investments with Madoff.
Casey Wasserman, chairman of the Wasserman Foundation, one of the fund's biggest benefactors, said he and Katzenberg realized 18 months ago that it was no longer sustainable to continue operating the money-losing hospital and nursing home, and closing the facilities was necessary to support the fund's other programs.
"The recession was maybe the straw that broke the camel's back, but we've been operating in a deficit for the last five years," said Wasserman, grandson of the legendary movie mogul Lew Wasserman. "What we're doing will allow us to thrive for generations."
The primary sources of funding for the home and hospital are Medicare and Medi-Cal, the government healthcare programs for elderly and poor patients. Tillman said the home and hospital cost $30 million a year to operate but received only $20 million in reimbursements.
The shortfall is a problem shared by similar, if less celebrated, facilities across the country. On average, for every dollar of care that hospitals deliver, Medicare pays 87 cents and Medi-Cal pays 78 cents, said Jim Lott, executive director of the Hospital Assn. of Southern California.
"That's a losing proposition for any hospital over the long term," he said.
More than 70 hospitals have closed in California in the last 12 years, and many are reeling from the effects of the economic downturn, the troubled financial markets and government budget problems.
The fund's Tillman said the decision "reflects some sobering economic realities that are affecting healthcare institutions nationwide. With costs skyrocketing and government reimbursement declining, operating our own acute-care and long-term-care facility is draining our resources at an alarming rate."
Tillman said the home planned to transfer about 100 residents to other long-term-care facilities. The transfers would begin in about 60 days.
The decision hit close to home for entertainment attorney Mark Fleischer, who serves on the board of the fund and whose mother has been a resident of the long-term care facility since October 2005. His father, "Doctor Dolittle" director Richard Fleischer, lived there until he died in 2006, as did his late grandfather Max Fleischer, who created the cartoon character Betty Boop.
"It's a sad thing, because when people move out here they do it with the expectation that it will be their final move," Fleischer said. "The level of care is unique. I suspect we'll find a facility that will be perfectly fine for my mother, but I don't think we'll ever see the same level of human care and compassion."
The closure of the hospital is expected to have little effect on nearby hospitals because it admits fewer than two patients a day on average and doesn't have an emergency room.
The fund will offer severance packages and help the laid-off employees find jobs. Still, the news hit workers hard as many considered the prospect of looking for new positions in a recession.
Los Angeles Times obituaries chronicle the lives and deaths of hundreds of actors, writers, publicists, directors, dancers and screenwriters -- headliners and the obscure -- who spent their final years at the country home and hospital.
Comedian Robert Cummings, the bachelor photographer in the 1950s television comedy "The Bob Cummings Show," died there in 1990 at 80. Actor-cowboy Joel McCrea died there in 1990 at 84. Comedian Jerry Colonna, remembered for his 6-inch walrus mustache, died there in 1986 at 82. House Peters Jr. -- Mr. Clean in the 1950s and 1960s -- died there in October at 92. Dick "Mr. Whipple" Wilson passed away there in 2007 at 91.
Entertainment industry workers and union officials were stunned by the news.
"I'm heartbroken," said Sharon Smith Holley, a visual-effects editor who serves on the board of the Motion Picture Editors Guild. "It's such a wonderful facility, and they have very caring and amazing doctors. This is just ripping apart our sense of community."
Added Steve Dayan, business agent for Local 399 of the Teamsters: "Our industry has always been committed to taking care of our retirees. This is a sad day."
Times staff writer Claudia Eller contributed to this report.