PRESS RELEASE FROM WALKER COUNTY HOSPITAL DISTRICT

November 1, 2019
Statement of the Walker County Hospital District
Regarding Walker County Hospital Corporation Bankruptcy

The following statement was issued by the Walker County Hospital District Board of Managers:
The Walker County Hospital District (District) is the government entity that created the hospital district and owns Huntsville Memorial Hospital. It is important that the public understand that the District and the Walker County Hospital Corporation (Corporation) are 2 separate, independent organizations with separate Boards and missions. The District is a governmental entity that created the taxing authority and owns certain assets, including the hospital facility and most equipment, which it leases to the Corporation. The Corporation is a private, nonprofit organization which has been solely responsible for operating Huntsville Memorial Hospital since 2004. There are no Board members in common between the District and the Corporation.

The District’s Board of Managers has been working to stabilize the hospital’s finances because the Corporation has been unable to operate the hospital so that it is financially viable. The Corporation is expected to declare bankruptcy this month.

The District Board has been doing everything in its power to address the Corporation’s dire financial situation, including providing substantial financial subsidies to the Corporation and deferring rent payments owed to the District. Even with millions of dollars in subsidies and rent relief provided by the District to the Corporation, the Corporation Board has informed the District that it cannot avoid bankruptcy and may close the hospital.

The District has proposed to serve as the Corporation’s lender during the pending of a bankruptcy if a bankruptcy is commenced, offering the Corporation Board very favorable terms. Notwithstanding this offer, the Corporation’s Board has chosen another lender, even though the other lender offered terms that are significantly less favorable to the Corporation than those offered by the District. If the Corporation Board had accepted the District Board’s offer to be the lender, the process would have ultimately saved the taxpayer money, the bankruptcy process would have been quicker and more streamlined and the Corporation’s bankruptcy estate would have benefited greatly from the favorable financial term. The District Board deeply regrets that the Corporation Board rejected the District’s offer.

The District Board remains committed to maintaining a viable hospital for the community and to improving hospital operations and services. The District Board is offering to purchase the Hospital Corporation’s assets in the bankruptcy process and is planning to enter into an agreement with an experienced nonprofit company to operate the hospital in conjunction with the District. The District Board’s priorities in making this offer are clear: maintaining a best-in-class facility here in Walker County that provides members of the public with the full range of medical services they require—and deserve.
District meetings are open to the public. Meetings and our agendas are posted on the District website at https://walkercountyhospitaldistrict.org/

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