Rural health center Nicholas County Hospital files for bankruptcy

Jul 21, 2014 | Healthcare Industry News

Nicholas County Hospital in rural Carlisle, Kentucky, announced that it plans to file for Chapter 7 bankruptcy protection. A spokesperson for the facility claimed "insurmountable financial challenges" are forcing the hospital to close its doors. 

The 14-bed hospital clinics have until Friday to close, with the exception of a rural health facility established in 2010 that is anticipated to continue operations. The facility stopped providing emergency room care on Monday, and the three remaining patients were transferred to other hospitals on Tuesday, according to hospital spokesperson Stephen Scalf. 

"It is only through the selfless dedication of our hospital employees that our hospital has been able to remain open this long," the hospital administration stated in a press release.

"Over the past months, the board members have been in almost daily contact exploring every possible option to keep the hospital open, however, when the financial situation reached a point that the hospital could no longer continue operating in accordance with its mission statement without jeopardizing patient safety, the board members had no other choice than filing for bankruptcy."

The hospital, operate by nonprofit organization JMHC Inc, has 44 full-time employees in addition to 40 part-time employees. All are being laid off once operations have ceased. 

Scalf explained that the hospital had enough funds to to make payroll for the current pay period, but there was no guarantee of having money beyond that. The news release also stated the the administration is looking for opportunities to reestablish an urgent treatment center on the county-owned property.

Many healthcare facilities are falling victim to a national trend of larger, urban-centered hospitals. If your facility is also struggling to continue providing care, consider outsourcing accounts receivable management. This can accelerate health insurance collections and increase cash flow at your facility.