Tuesday, April 29, 2014
HFN: 'When finances fall apart: Bankruptcy may lead to salvation'
"Last summer, the 40-bed hospital filed for Chapter 11 bankruptcy protection in July. But bankruptcy didn’t lead to closure for Kentuckiana [Medical Center]. It actually led to its salvation.
Shortly after a settlement agreement with the hospital’s creditors was reached in November, Galichia Hospital Group, a national healthcare development firm based in Wichita, Kan., took over the hospital. Galichia brought on a new management team led by chief executive officer Michael Phillips, but retained Kentuckiana’s 200 employees.
Galichia also added a couple more service lines and more employees, Phillips said, and it plans on launching a new emergency department and increasing the number of patient rooms, turning a desperate situation for Kentuckiana into a win.
'It was a smooth transition,' said Phillips. 'Sometimes it can be a rough transition when you are trying to identify where costs are being lost, or how to downsize in many cases.' Kentuckiana and its surrounding community were very fortunate in the way the takeover by Galichia turned out, said industry observers."
Link to Healthcare Finance News