CMH reaches tentative deal to continue operations as bankruptcy process proceeds
Fri, 23 Mar 2012 00:00:44 GMT —
A tentative deal has been reached to keep Cheboygan Memorial Hospital open for now as a deal is negotiated surrounding the hospital's bankruptcy.
Cheboygan Memorial filed for Chapter 11 Bankruptcy earlier this month.
Just Wednesday, we were there as hospital officials were forced to close the long-term care facility to cut costs.
The hope now is that McLaren Health Care System will buy the struggling facility, saving it from closure.
That's what's being discussed in Bay City Federal Bankruptcy Court.
"i think the prospects are still looking very good that we'll be able to move forward, but it's yet to be decided," says Jamie McClurg, Chairman of the Board for CMH.
Thursday, more than 10 lawyers from different creditors, asset holders, McLaren, and Cheboygan Memorial Hospital were battling right up to the gun to try to work out a deal to keep the hospital open. Maybe in a string of luck, the hearing was delayed an hour and a half.
"We were probably minutes away from McLaren walking away from a possible purchase of the hospital, if it wasn't for Medicare and Medicaid stepping up to provide an additional $400,000 in funding and Citizen's National Bank stepping up to the plate and providing an additional $200,000 in funding, then McLaren would have no happened today, and while it's still not a done deal, we think we're a step closer," says Doug Damm.
Doug Damm was in Bay City representing Citizen's National Bank of Cheboygan. He wouldn't go into figures, but he did tell me his bank will lose millions if the sale with McLaren goes through. He says it's a price to pay to keep healthcare in Cheboygan. Without a tentative deal being in place this afternoon to fund operations for the next two weeks, it could be an entirely different ballgame going into tomorrow.
â??There would have been no more money to fund the operations of the hospital. That would have ensured the closure," says Damm.
Meaning as of Friday night, operations could end if the deal isn't cemented and accepted by the bankruptcy judge. Jamie McClurg says there are still three key elements to be worked out. I asked him if he feels confident.
â??Yeah, but you never know. There's always a little bit of uncertainty, but Iâ??m hopeful and optimistic and prayful that the hospital will continue to operate, I think it's in everybody's best interest to happen, now we just have to finalize details, get them before the judge, and hopefully get approval," says McClurg.
All parties will be back in court Friday afternoon.
Cheboygan also hopes to get an answer from the bankruptcy judge of whether the sale of the hospital to McLaren can move forward.
We'll continue to update you in this developing story.