The U.S. trustee who oversees the bankruptcy case filed by Hutcheson Medical Center in Fort Oglethorpe, Ga. said the case should be dismissed because the financial condition of the hospital is too far gone.
Guy Gebhardt asked a judge this week to terminate the hospital's Chapter 11 bankruptcy. He wrote that Hutcheson Medical should lose its bankruptcy protection because it has incurred another $5 million of debt since November and has yet to file a reorganization plan - the ultimate goal for a company in Chapter 11 bankruptcy. The hospital's condition in the last three months, meanwhile, has created a "grave concern" for the health of its patients.
With approximately $80 million in liabilities, Hutcheson Medical filed for bankruptcy in November to keep creditors at bay. If the judge agrees with Gebhardt and the hospital loses bankruptcy protection, those creditors likely would return. They include Regions Bank, which is waiting for approximately $30 million, and Erlanger Health System, which is waiting for $22 million.
Gebhardt has asked for an expedited hearing. Last week he met with Susan Goodman, a court-appointed hospital ombudsman, to discuss conditions at the hospital and any risk to patients caused by the current financial strain. He said the ombudsman told him there is concern about the "increased strain on the debtors' clinical lab as evidenced by increasingly tight staffing patterns, delayed supply delivery necessitating borrowing of standard items from other facilities to meet patient care needs and analyzer equipment problems.
Analyzers are machines that break down the blood samples drawn from patients. The machines are complicated, requiring employees to calibrate them often and keep a stock of required chemicals and solutions. Most hospitals keep two analyzers, Goodman said. But Hutcheson has only one.
Farrell Hayes, president and CEO at Hutcheson Medical, said the trustee's statements about the hospital's problems are untrue.
"As a community hospital, we by definition make top priority the well-being of every community member that walks through our doors. We can confidently say that these recent allegations are baseless and we look forward to discussing our case with the court," Hayes said in a statement. "Hutcheson has been nationally accredited, awarded for its quality care and a critical healthcare partner in North Georgia for generations."
Hayes said the hospitals medical staff and patients will be the "first to tell you that our patient care fully meets the needs of this region and places the safety and comfort of our patients front and center. As a community hospital, we by definition make top priority the well-being of every community member that walks through our doors.
Goodman expressed concerns about the hospital in a July 9 court filing, writing that employees expressed "significant leadership concerns" about the hospital. She also wrote that the radiology department doesnt work fast enough. Sometimes the emergency room staff has to read the scans themselves, even though they aren't trained to pick up minute but important details.
Hutcheson Medical currently also is locked in a complex lawsuit with Erlanger Health concerning an earlier period when Erlanger Health managed the hospital. The case involves a number of attorneys with high legal costs. Attorneys for the hospital last Friday filed a 134-page complaint asking that the Erlanger Health lawsuit be stayed.