Little River Healthcare's primary- and specialty-care clinic King's Daughters Clinic was closed to patients Wednesday. The clinic's voicemail greeting did not say why the clinic was closed.
"Due to an unfortunate turn of events, Little River Healthcare will be shutting its doors immediately," said the recorded message, which then gave patients instructions for obtaining copies of their medical records.
Rockdale-based Little River filed for Chapter 11 bankruptcy in July, and last week sought to convert the case to Chapter 7, under which a trustee would liquidate its assets. Little River Chief Restructuring Officer Ronald Winters wrote in a letter to employees that the company has been unable to find a buyer to take over. In addition to hospitals in Rockdale and Cameron, the company operates imaging centers, surgery centers, rehabilitation centers and physician practices, mostly in central Texas.
Court records show commercial insurers are clawing back money or refusing to pay for lab tests billed by Little River Healthcare. The company apparently was engaged in a scheme to charge for high volumes of lab tests out of its flagship critical-access hospital in Rockdale. Critical-access hospitals receive higher reimbursement for services, including labs.
A Modern Healthcare investigation found the company's Rockdale hospital reported extremely high lab outpatient lab charges in 2015 and 2016: $213.6 million and $372.2 million, respectively. Outpatient labs accounted for 62% of the hospital's total charges in 2015 and 86% in 2016. Other hospitals that Little River previously managed showed similar spikes.
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