Coalinga Regional Medical Center image via Wayne Allen
Written by The Business Journal Staff
The board of Coalinga Regional Medical Center announced the district has filed for chapter 9 bankruptcy protection.
The hospital first announced in May that it would be closing its emergency room. A plan to keep the hospital operating under new management failed soon after, and all hospital operations seized in June.
A chapter 9 filing is a type of bankruptcy reorganization available to municipalities and certain governmental agencies. The filing in U.S. Bankruptcy Court on Sept. 7 lists estimated assets as well as liabilities of between $10 million and $50 million.
â€œWe have struggled for several years due to low reimbursement rates and declining patient census,â€ said Sandy Beach, current board chairwoman who has served on the body for more than 15 years.
CEO Wayne Allen said the chapter 9 filing â€œwill best protect patients, employees and citizens of the district.â€
â€œWe are confident we can increase our revenues and address our expenses to the point we can reopen and provide health care services,â€ he added.
Fresno bankruptcy attorney Riley C. Walter represents the district. He said the hospital is the victim of similar forces that led to chapter 9 cases for rural hospitals in Dinuba, Avenal, Corcoran, Reedley, Tulare and Kingsburg.
â€œBy filing chapter 9 the hospital will receive breathing room from pending lawsuits and this will allow the board and staff to refocus on financial rehabilitation rather than putting out fires,â€ Walter said.
With nearly 16,600 residents, Coalingaâ€™s next closest emergency room is about 40 miles away in Hanford.
â€œThe people of the District need and deserve an acute care facility,â€ Allen said. â€œThis is more beginning than the end.â€