October 16, 2018 10:42:33 AM
JACKSON -- A bankrupt company warned on Friday that it might close a hospital in the Mississippi Delta if it can't transfer ownership within weeks.
Curae Health filed papers Friday in U.S. Bankruptcy Court in Nashville, Tennessee, saying Northwest Mississippi Regional Medical Center in Clarksdale is losing so much money that it could pull down the bankrupt company before it can sell hospitals in Amory and Batesville. Curae filed for Chapter 11 bankruptcy reorganization in August, saying it would sell all three hospitals.
The company cites $57 million in liabilities against $12.6 million in assets, saying revenues fell below levels needed to make debt payments.
The Knoxville, Tennessee, company sent a letter to the 484 employees of the Clarksdale hospital on Friday warning of possible closure in December.
Curae leases the hospital from Coahoma County for $500,000 a year. Coahoma County Supervisor Paul Pearson said supervisors on Monday hired a consultant to help them seek a new operator.
"Closing the hospital is unacceptable," Pearson said.
Pearson said Curae is willing to transfer the lease to a new operator at no cost if the new operator will assume the liabilities. He said at least two groups have expressed interest in taking over the hospital and that a third possible bidder may emerge in coming days.
One hurdle for a new operator would be a need for four to six months of working cash. Pearson said the hospital costs $5 million a month to run, and that revenue might not flow reliably to a new operator setting up billing systems for up to six months.
U.S. Bankruptcy Judge Charles Walker has set a hearing for Oct. 23 on Curae's request for a quick transfer.
Curae plans to auction Amory's Gilmore Memorial Hospital on Nov. 15. Walker has approved a plan naming Tupelo-based North Mississippi Health Services to act as an initial bidder offering $10.5 million in cash. Others could take part in the auction as well. State Sen. Hob Bryan, an Amory Democrat, is calling for the creation of a community non-profit to buy the Amory hospital, saying that would maximize the medical services available in Amory over time. North Mississippi Health Services CEO Shane Spees tells the Northeast Mississippi Daily Journal that the hospital system doesn't plan to strip services from Amory, with Spees saying he envisions growth.
Amory Mayor Brad Blalock and the Monroe County Chamber of Commerce aren't favoring one proposal over another, but Blalock stressed the importance of maintaining a strong medical community.
Curae hasn't disclosed sale plans for Panola Medical Center in Batesville.
The hospitals are the latest to struggle in Mississippi. Magee General Hospital is also in Chapter 11. Five rural Mississippi hospitals have closed since 2013, while the North Carolina Rural Health Research Program says 87 rural hospitals have closed nationwide since 2010. Curae closed a hospital in Haleyville, Alabama, in January.
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