Black Magic?

[KCSteve]

Is Magic Healthcare going under? Last week's Friday check was not paid till the following Tuesday. Then, they sent out letters stating that "due to the company's financial constraints," there are "outstanding payments owing to your healthcare providers" and that they are "currently working on a time schedule for making these payments." They sent a list of $800 of my own medical bills that weren't being paid, but would be "within approximately the next 30 days." It made me nervous at the time that they ended the letter by telling me that they would notify me "as the time frame for these payments is solidified."

But, the check came Tuesday and I was placated. Dodgey, but I can ride out the remainder of the contract. And besides, I was told that it would be made up to me, the implication financial.

Forward two weeks to another payday. No check. I understand that no traveller signed with Magic in the entire country received a check today. Their office phones go straight to an answering service, and when finally patched through to the president's mobile phone, I was told there were no answers to be had and that the parent company couldn't be reached.

If they go under, what? then? Would the hospitals eat the fees they paid Magic and pay travellers directly for the remainder of their contracts in order not to lose valuable parts of their staff?

Very worried. Others with magic, do tell your version of today's events. And, anyone else with info on the status of Magic Healthcare, please enlighten us all . . .

[suzanne4, RN]

Unfortunately, your contract as is is with the agency, not the facility. The bigger issue is your housing, etc., if the agency was actaully paying for it, or were you with a stipend? Can you afford to continue to pay it?

I would consult an attorney immediately, as the employees actually need to be paid first.

Sorry, but I have never heard of this agency, where are they based? How long have they been in business, etc.? The type of contract that the agency has with the facility will determine if the facility is permitted to keep you on. This again needs to be discussed with an attorney.

[KCSteve]

Thanks for getting back. Personally, I'm on stipend, and no, I couldn't afford living where I do without it.

To your questions, Magic Healthcare is a subsidiary of Diversified Corporate Resources (DCRI) out of Dallas, which trades publicly under the AMEX symbol "HIR." Magic itself was based in Palm Desert, CA, but fairly recently moved to Arizona. Their websites are magiccorp.com, dcri.net, and magictravel.com. Through luck and negotiation, I am being paid more than any of the larger agencies that I have been with before could afford to pay, and until last pay period, I haven't had any problems with Magic worth posting about on the forum.

I have a source that told me the IRS just collected on back taxes owed them by DCRI, the parent, and that it left Magic in a bad place. Would the IRS, though, take a significant enough a chunk of a corporation's available assets as to jeopardize the jobs of people in a sector so vital to national security? Only slightly tongue in cheek. One would think that the IRS would take it incrementally. Anyone??

[KCSteve]

My source just forwarded me a link to an article about the IRS problem, and yes, the IRS worked out a deal whereby each of DCRI's subsidiaries will have to pay $20k/month. Magic isn't a huge operation. This may flush it, and with it, the contracts of a lot of travellers.