Business
Indiana physician-owned hospital in bankruptcy
NEWS IN BRIEF — Posted Sept. 13, 2004
A hospital in Indianapolis has been forced to seek bankruptcy protection less than six months after it was purchased by a group of doctors.
Winona Memorial Hospital announced Aug. 24 that creditors had filed a petition to force it to reorganize its debt under Chapter 11. Robert E. Mehl, MD, PhD, chair of the board of WMH Physicians Hospital LLC, said the hospital would remain open during the reorganization.
"It has always been the intent of the physician ownership to fulfill the hospital's financial commitments to its suppliers," Dr. Mehl said in a written statement. "Unfortunately, the distressed condition of the hospital when the physicians acquired it, and the inability to obtain adequate financing, has resulted in creditors filing the involuntary petition."
"We have constructed a reorganization plan that will allow us to continue operations and maintain control over our hospital, and ask for court-ordered relief from our creditors."
Winona owes about $400,000 to Indianapolis Power & Light Co., said Crystal Livers-Powers, a spokeswoman for the utility. She said the company had cut off electricity to two ancillary hospital buildings in early August, but the action did not result in anything "that would lead us to believe they were going to resolve their debt." She said the firm had filed the bankruptcy petition Aug. 23 with two other creditors.
Note: This item originally appeared at http://www.ama-assn.org/amednews/2004/09/13/bibf0913.htm.
