Hawaii Medical Center files Chapter 11 bankruptcy
The Hawaii Medical Center has filed for Chapter 11 bankruptcy reorganization, blaming skyrocketing health-care costs and a slower-than-expected implementation of its turnaround plan because of a cash shortfall.
Hospital officials filed in U.S. Bankruptcy Court in Delaware Friday on behalf of its two subsidiaries, HMC East and HMC West, which were the previous St. Francis hospitals in Liliha and Ewa Beach.
“We remain confident in our long-term prospects for success,” said Hawaii Medical Center CEO Danelo Canete in a prepared statement. “These filings will permit us to continue to serve our patients as usual while we remain on the path to financial stability.”
The hospital announced earlier this month that it would lay off approximately 80 of its 890 employees.
Hawaii Medical Center bought the two hospitals from St. Francis Health Systems in January 2007.
Hospital officials said Hawaii Medical Center was forced to file for bankruptcy because its lender refused to extend existing loan agreements.
“We faced the threat that our lenders would freeze our cash, creating a liquidity crisis that would force the hospitals to shut down,” Canete said payday loan low fee. “We are seeking protection so that we can continue to operate and provide care to our patients, with no noticeable changes or interruptions.”
Officials said Hawaii Medical Center has enough cash to pay all of its employees and will keep wages and benefits as they are. In addition, it is proposing to sell its accounts receivable in order to fund full payment to its vendors and other unsecured creditors.
Hawaii Medical Center is a partnership of CHA Hawaii, an affiliate of Cardiovascular Hospitals of America, a leading U.S. hospital management company, and the more than 130 Hawaii-based physicians who form Hawaii Physician Group LLC.
Filed under: news by Guru