The shuttered Madera Community Hospital is seen in this March 2023 photo by Ben Hensley

This story was originally published by Fresnoland, a nonprofit news organization.

A community advocacy group hopes to reignite the legal debate over plans to reopen Madera’s bankrupt hospital, citing alleged gaps in the turnaround plan presented by the hospital’s new operators, American Advanced Medical, Inc.

In a scathing court filing Tuesday, the Madera Coalition for Community Justice, represented by Fresno attorney Patience Milrod, claimed that AAMI does not have the track record to reopen the Madera hospital successfully — or any time soon.

“Like everybody, we want the hospital to be reopened,” Milrod told Fresnoland on Tuesday, “and our concerns about good faith can be set at rest if there were conditions on the approval of the plan that will allow the public to feel comfortable that there’s oversight and that the hospital will reopen truly with a mission to serve Madera County residents.”

AAMI’s Chief Strategy Officer Matthew Beehler fired back, saying no other company has reopened more hospitals in California than AAMI and any claim it would not be able to reopen the Madera hospital is baseless.

“We are well prepared and already making progress towards a future licensing survey,” Beehler wrote to Fresnoland via email.

The coalition’s objection states that the creditors’ liquidation plan was not proposed in good faith and does not commit to restoring health services to Madera’s residents. It also claims AAMI has fallen short of meeting community health needs with its Madera reopening plan.

“Moreover, AAM’s true solvency is untested;” the court filing stated, “the apparent frequency with which it has failed to pay taxes timely and to meet financial obligations short of litigation, give rise to legitimate concerns that if confirmed the Plan would put MCH at risk for liquidation.”

It also calls for California Attorney General Rob Bonta to instate specific conditions on AAMI’s acquisition of the hospital to require current gaps in services be bridged. That includes addressing how AAMI does not plan to open a labor and delivery room at the Madera hospital — a detail Fresnoland revealed back in February.

The Madera hospital had between 700 and 800 births a year, according to state data cited in the court filing, demonstrating a health need that would be unmet with AAMI’s current reopening plan. Additionally, the court filing states that none of AAMI’s eight hospitals in California have a labor and delivery room.

“To assert that this Plan will “reopen” MCH as a safety-net hospital, when the proposal in fact commits to no more than a stripped-down facility offering few of the essential services needed and serving a much-reduced patient population, amounts to a bait and switch scheme rather than a good faith proposal,” the court filing reads.

Beehler pushed back against criticism over not reopening a labor and delivery room. He said the attorney general’s office recognized the challenge of restoring maternity care in the initial stages of reopening a hospital and signed off on it.

“The other proposed operator, Adventist Health, did not have a labor and delivery unit as part of their earlier reopening plan, and in fact, is currently in the process of closing multiple L&D departments in Tulare and Simi Valley,” Beehler said via email. “Trying to target AAM with this criticism is unwarranted.”

At the core of the Tuesday objection is that the creditor’s Chapter 11 liquidation plan is incomplete since it fails to require the consideration of the already shot-down UCSF-Adventist proposal in case the AAMI plan fails.

Milrod said this comes down to whether Madera County’s only general acute care hospital will be sustainably restored.

“We don’t care who does it,” Milrod said. “As long as it’s done right, that’s all we care about.”

It’s unclear whether the objection could impact AAMI’s acquisition of the Madera hospital, and whether a court hearing — on April 16 — could yield yet another unexpected turn for the hospital.

That depends on whether the objection draws the concern of U.S. Bankruptcy Judge René Lastreto.

Bonta’s office was also not immediately available for comment.