Two hospitals filed for bankruptcy protection in April as they look to keep operations running while awaiting potential buyers.
Marshall, Mo.-based Fitzgibbon Hospital filed for Chapter 11 bankruptcy protection April 21 after facing increasing financial pressures, such as rising operating costs, workforce shortages and reimbursement at less than cost from government payers.
Fitzgibbon’s board and management determined that filing for bankruptcy protection in concert with a proposed sale was the best path forward. The hospital said it has secured a partner for the sale of the facility, but has not disclosed the name of the prospective buyer.
Greenwood (Miss.) Leflore Hospital filed for Chapter 9 bankruptcy protection April 15, days after a WARN notice was sent to employees informing them the hospital could close June 15 if it is unable to stabilize its finances.
The Mississippi Division of Medicaid has been seeking to recoup millions of dollars in alleged overpayments from the hospital. To date, the division has recouped $2.5 million in payments that would have otherwise been received by the hospital, according to the WARN notice, and the division is seeking another $5 million. In March, a Mississippi judge granted a temporary pause on the repayment.
The hospital is in talks with University of Mississippi Medical Center in Jackson regarding a potential takeover of the facility. The hospital and UMMC signed a letter of intent in early March that gives both parties 180 days to negotiate exclusively, though either side may terminate the deal with 30 days’ notice.
Greenwood Leflore said its goal is to complete the potential acquisition this summer.
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