New Plan Emerges to Save De Queen Hospital

by Mark Friedman  on Wednesday, Oct. 13, 2004 11:54 am  

The De Queen Regional Medical Center has announced that Pacer Health Corp. of Miami is interested in buying the hospital, which filed for Chapter 11 bankruptcy protection in September.

For the sale to go through, the city of De Queen would have to pay Pacer Health a one-time fee to handle its indigent care, the price of which is still being negotiated, said De Queen Hospital Administrator Bruce Bennett. The city then would recoup its money through the 1 cent sales tax the voters passed in May to save the hospital, he said.

Pacer then would operate the hospital.

The De Queen City Council is expected to vote on that plan on Oct. 19, which then would be subject to the approval of the Bankruptcy Court.

Another option the city will be deciding Oct. 19: its original plan to pass a 1 cent sales tax to help the hospital. The tax is expected to generate more than $1 million a year, but the city has to buy the hospital first before it receives the money.

At a September De Queen City Council meeting, the council approved buying the hospital using bonds backed with the hospital sales tax money and future hospital revenue. De Queen Mayor Dale Kesner vetoed the sale because he said the city would be on the hook if the hospital continues to lose money.

The third option the hospital has is closure, Bennett said.

On Sept. 3, De Queen Regional Medical Center filed for Chapter 11 bankruptcy protection, listing nearly $7 million in claims. Board chairman Jay Bunyard said the hospital is on the verge of shutting its doors if the city or someone else doesn't step in and buy it for $5.25 million.

Bunyard said the hospital was placed on life support because it — along with other hospitals across the state — have lost millions of dollars from Medicare payment reductions sparked by the Balanced Budget Act of 1997. It also has been without a full-time surgeon for about two years, which hurt revenue, he said.

Bunyard projected a loss of $1.2 million for the fiscal year that ended Sept. 30.

 

 

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