Two members of Congress have spoken out on behalf of 50-bed Dickenson County Medical Center, Clintwood, Va., which closed its doors earlier this month as a result of the bankruptcy of National Century Financial Enterprises.
Dublin, Ohio-based NCFE, which filed for bankruptcy protection Nov. 18 in U.S. Bankruptcy Court in Columbus, Ohio, carried the medical center's receivables.
NCFE purchased accounts receivable at a discount from providers. It then sold bonds and used the proceeds to front the hospitals cash for payroll, sparing them the wait to be reimbursed by the government and private insurers. NCFE collected the receivables and assessed the provider clients various fees and interest for the money advanced. The company stopped making payments to providers in October.
In a letter this month to the judge presiding over NCFE's bankruptcy case, Sen. John Warner (R-Va.) requested that the court take action to "enable the continuing operation" of the hospital pending a sale to the Dickenson County Industrial Development Authority, which has said it will pay "fair value" for the facility. Rep. Rick Boucher (D-Va.) sent a similar letter.
"I'm hopeful and optimistic, but until they can have a hearing scheduled before the bankruptcy court, I don't know how it's going to turn out," said Benjamin Peak, the hospital's chief executive officer. The hospital has annual revenue of roughly $10 million. Warner and Boucher told the bankruptcy judge the hospital is in a remote location and its closure would make it difficult for patients to find care, in addition to putting some 200 people out of work. The hospital discharged all patients before closing, Peak said; its last census was 11.
At deadline, the bankruptcy judge, Donald Calhoun, had not replied to Warner and Boucher. Warner hopes the hospital can re-open soon, without the need to recruit a new staff of nurses, physicians and other personnel, according to a Warner spokeswoman. "Time is of the essence," she said, adding Warner may seek to provide financial assistance to the hospital but not if the money would go to NCFE's creditors instead of the hospital itself.