THE BLOG
02/09/2009 02:15 pm ET Updated May 25, 2011

Hollywood Betrays its Own

Something doesn't smell right at Hollywood's retirement home for actors, technicians and studio workers. The stench isn't coming from the corridors or the bathrooms of a facility widely admired for its impeccable nursing standards. Rather it's coming from the executive offices of the Motion Picture & Television Fund, the endowment established 87 years ago by Mary Pickford and Charlie Chaplin that now says it is in deep financial trouble.

Last month, the MPTF announced it was closing its long-term care facility and hospital -- effectively ending the organization's pledge to "take care of its own" and make sure rank-and-file entertainment industry workers would have their every need attended as they reached the end of their lives. The move means the eviction of more than 100 physically and infirm people in their 80s and 90s over the next several months.

The MPTF said then -- and has repeated since -- that the closures are inevitable because it is losing $10 million a year and faces bankruptcy if it does nothing to stop the flow of red ink. The shortfall, it says, is because reimbursements from Medi-Cal and Medicare keep going down, while the cost of providing care keeps going up.

The problem with this explanation is that it is contradicted both by the MPTF's own audited accounts, posted at its website, and by its tax returns. Those documents show no losses, at least up to the end of 2007 (the last year for which figures are available). They show that the fund's assets were growing in 2006 and 2007 -- not "draining... at an alarming rate" as one MPTF news release said. They also suggest that reimbursement rates have been going up, not down, in the same period.

Clearly, somebody is not shooting straight about all this. The real reasons behind the closures remain a mystery -- it could be to do with the meltdown on Wall Street, or it could be something else. The news, meanwhile, has infuriated both the families of the home's residents, who are planning a lawsuit to try to reverse the decision, and the Hollywood community at large, which used to see the home as a rare island of stability and security in a notoriously volatile industry.

I've done quite a bit of digging and posted the first of at least two reports at Sharon Waxman's new Hollywood news website TheWrap. Seems to me that David Tillman, the home's chief executive, and Jeffrey Katzenberg, who chairs the MPTF's fundraising arm, have some explaining to do.