Judge Orders Immediate Closure Of Hutcheson Medical Center; Assets To Be Sold Dec. 3

Thursday, November 5, 2015

A bankruptcy judge on Thursday ordered the immediate closure of Hutcheson Medical Center in Fort Oglethorpe after the bankruptcy trustee said it was no longer financially feasible to keep it up.

Judge Paul Bonapfel of Atlanta said the trustee "shall continue to take all appropriate measures to ensure the health and safety of all patients."

The assets of the hospital, which at one time had over 900 employees, are to be offered for sale on Dec. 3.

He said the closure would not affect the proposed pending sale of the Parkside nursing home located adjacent to the hospital. There have been offers of $7 million and then $7.2 million for that facility, which has over 100 residents. Maybrook Healthcare has the current high bid for the nursing home.

It does affect the Battlefield Parkway Ambulatory Care Center.

Attorneys said a "Stalking Horse Bidder" is being sought to make an initial offer that will serve as a floor for later bids.

Those interested in bidding must apply with the Guggenheim firm that was hired earlier by the hospital to seek a purchaser. That deadline is Nov. 24 at 4 p.m.

The auction will be in the office of GreenbergTraurig on Piedmont Road NE in Atlanta.

A hearing after the sale before Judge Bonapfel will be in Atlanta on Dec. 14 at 10 a.m.

Under terms of the auction, those allowed to attend will be limited to qualified bidders, Guggenheim, the bankruptcy trustee, the creditors committee, Regions Bank, the U.S. Trustee, and Erlanger.

Regions Bank was the major lender to the hospital, which was set up to serve Catoosa, Walker and Dade counties.

Erlanger put $20 million into Hutcheson during a period when it was managing it. Erlanger later filed suit to retrieve that amount, plus interest and other charges now calculated at over $30 million. Hutcheson counter-sued. The litigation between the two hospitals was finally put on hold as Hutcheson's fortunes sank.

Catoosa and Walker counties put up $10 million each to guarantee the $20 million provided by Erlanger. That guarantee has not yet been paid off.

 


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