What happened Wednesday at the Hutcheson hearing in Rome?
There are now only two arguments: should the hospital be foreclosed on now, as a whole, by Erlanger, to cover its debts to them, or should it remain open for a while to be sold off a piece at a time to pay some of its debts to other companies?
The first option is the one Erlanger wants, the second is what Regions Bank, other creditors, Hutcheson’s leaders who got the hospital into its current shape, and Walker County want to see done.
A courtroom account from a local who drove down and witnessed:
“There were attorneys respresenting various creditors including Regions Bank. All of them want Hutcheson to continue in Chapter 11 so the hospital can be sold. The hearing went for 5 hours with a couple of small breaks. Below are highlights:
“The patient ombudsman stated patient census at Hutcheson this past Tuesday was 7 inpatients and 1 in ICU. She stated concerns over equipment malfunctions such as MRI and CT machines. She also noted shortages in supplies in the lab which hampered staff’s ability to serve the patients. She also said there were morale issues, especially related to employee health claims not being paid. She stated staff was execptional but the hospital facilities and equipment were antiquated.
“Dr Lori Emerson, the Medical Director of the Lab testified of supply shortages and equipment malfunction like the analyzer, which tells staff if someone’s white or red blood counts are high/low. She also testified the new administrative director of the lab has no background in that role and the hospital has a self audit of the lab coming up and this person has no compliance training to do this. The new director was promoted from the hospital’s blood bank where he still serves as supervisor. Dr. Emerson stated he was a great person and does good work in the blood bank but is out of place in the lab. Riveting testimony and very credible.
“Dr. Ashburn, the Medical Director of Hutcheson testified that the staff was great and he was not aware of any equipment shortages or supply shortages. When pressed by the attorney representing the trustee, Dr. Ashburn indicate that between his private practice in pulmonology and the hospital, he would make appoximately 600K this year. And he testified he has not missed a paycheck from the hosptial.
“Farrell Hayes, the CEO of Hutcheson also testified. He went over various financials of the hospital and other issues. He was challenged as to why he had not taken action soon to help the hospital – his answers were not very direct. He did state he makes $280,000 and he has not missed a paycheck.
“Two things from the judge – he said he had heard of a lot of problems about the hosptial but none of the attorneys on either side has suggested how creditors get paid. The other – he wants the hospital sold – in his words ‘if the dirt is worth more than the buildings, just sell the dirt.'”
Per the Times Free Press, Hutcheson’s CEO (remember, he’s still getting paid) thinks the hospital should stay in bankruptcy for another eight months while they wait on a buyer, because letting Erlanger take over will cost 700 jobs (they don’t have 700 employees left) and harm the hospital’s remaining patients, who wouldn’t half fill a small school bus.
He insists they have a buyer, lots of buyers, buyers lined up to buy the hospital whole.
Hutcheson’s “unsecured creditors” who are second on the list to get paid after Erlanger IF there’s a foreclosure think this mess needs to drag on forever as they each get paid tiny bits of everything Hutcheson sells off. They want another trustee brought in and more layers of supervision to complicate things further, all of which costs more money.
Meanwhile Hutcheson is adding about a million a month to its debts, and every day it stays open grows that pile.
$1.3 million in debt in just three weeks.
So yeah lets keep the place running like that for ANOTHER year, why not? As long as the CEO and the top administrators (and the lawyers) keep getting paid.
Hutcheson will eventually close down either way, but the decision a judge makes will make the difference between Hutcheson’s current properties and services being split up among many different owners as debt keeps growing and conditions worsen, or kept together and changed to another owner all at once now.
Patient care is deteriorating badly, employees are suffering, and debt is piling up fast. The best option is to put Hutcheson out of its misery now and hand the whole thing over, whole, to Erlanger before the situation (and county-backed debts) get worse.
All sides are back in a Rome courtroom again today to further argue these points.
Today CEO Hayes, again being paid his full salary for every week Hutcheson scrapes along in business, testified in Rome that the hospital has a buyer ready to take over within a week.
Based on THAT testimony, the bankruptcy trustee decided to drop his argument that the hospital should lose bankruptcy protection. The judge never ruled either way because the matter he was ruling on has been dropped.
If no buyer surfaces in a week, will Hayes go to jail for perjury? Will this whole process start over again?
Either way, patients and employees continue to suffer – and the taxpayers’ bill keeps growing. Hutcheson continues to drag along, dangerous, dying, and in debt.
Meanwhile, another judge has ruled the hospital may sell its walk-in clinic to Dade County for $200,000 less than the land it sits on is worth. That deal will soon be done and Memorial will take over the Trenton facility.