Case Studies

Debt Restructuring Creates Solid Footing: North Texas Medical Center, Gainesville, Texas

The Situation

Gainesville Hospital District saw light at the end of the tunnel—a new beginning for North Texas Medical Center (NTMC). The district had leveraged bankruptcy to get the legal protection and time it needed to develop a plan to restructure $40 million in debt, pay creditors, and keep the hospital open. The district secured debtor-in-possession financing and filed a bond validation to enhance the appeal of its bonds as investments. Gainesville Hospital District was on the right track to emerge from Chapter 9, but the district needed to...


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Blog

Hospital Districts Provide Critical Financial Support for Community Hospitals

Stemming the closure rate of rural hospitals may depend in part on the financial support provided by hospital tax districts. This can be difficult to swallow for many who are reflexively against higher taxes. However, voters may come around when the case is made that a modest property- or sales-tax levy or hike could provide the necessary financial support to keep their hospital open and sustainable for their community.

Hospital Tax Districts Fill a Funding Gap

Tax districts help ensure the survival of hospitals that may be at risk of...


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News Room

A Turnaround Story: Southwest Health System

A recent blog post by Community Hospital Corporation (CHC) details the situation that caused Southwest Health System to reach out to CHC for assistance in early 2018, the plan they created to turn around the hospital, and the final results to date.

When the Southwest Health System (SHS), in Cortez, Colorado, contacted Community Hospital Corporation (CHC) early in 2018, the hospital had violated various bond covenants associated with its $30 million expansion and renovation project. In fact, the organization had failed to meet the 80 days-cash-on-hand requirements for four consecutive...


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News Room

Lessons for Leaders of Distressed Hospitals

A recent guest blog by Community Hospital Corporation (CHC) featured tips for successful turnaround by Anthony Sudduth, CEO of Southwest Health System.

Last year, Southwest Health System (SHS), in Cortez, Colorado, found itself in the midst of a significant financial crisis. The hospital had violated bond covenants associated with a $32 million building project, failing to meet the 80 days cash-on-hand requirement for four consecutive quarters. This violation triggered technical default, which could have led to bankruptcy and closure. Instead, SHS acted swiftly and decisively, becoming not a cautionary tale...


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Blog

Lessons for Leaders of Distressed Hospitals

GUEST BLOG

By Anthony Sudduth, CEO, Southwest Health System

Last year, Southwest Health System (SHS), in Cortez, Colorado, found itself in the midst of a significant financial crisis. The hospital had violated bond covenants associated with a $32 million building project, failing to meet the 80 days cash-on-hand requirement for four consecutive quarters. This violation triggered technical default, which could have led to bankruptcy and closure. Instead, SHS acted swiftly and decisively, becoming not a cautionary tale but a comeback story and an inspiration.

The SHS turnaround is a bright...


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Case Studies

A Turnaround Story: Southwest Health System

The Situation

When the Southwest Health System (SHS), in Cortez, Colorado, contacted Community Hospital Corporation (CHC) early in 2018, the hospital had violated various bond covenants associated with its $30 million expansion and renovation project. In fact, the organization had failed to meet the 80 days-cash-on-hand requirements for four consecutive quarters. This violation triggered technical default, which could have led to hospital bankruptcy
and closure.

Lenders concerned with the financial situation communicated with the board directly and required an outside consulting firm to evaluate the situation and develop a...


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Blog

Overseeing Without Overstepping: The Board’s Role in Hospital Operations

To what degree should boards be involved in the finances and operations of their hospitals? This is an important question, because effective hospital boards are clear on their roles and responsibilities. That role is hospital governance while management is the responsibility of the hospital leadership team. That means board members must focus on strategy and leave operations to hospital leadership. Yet, it’s not only appropriate but also imperative that board members understand the finances and operations of their hospital.

That means board members must discern the financial situation; education about...


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News Room

The Future of Rural Hospitals

How to remain relevant and sustainable by meeting challenges with change by Jim Kendrick, President & CEO, Community Hospital Corporation

At rural hospitals coast to coast, business practices that hospital leaders once counted on as tried-and-true are uncertain or unreliable. Today, a renaissance of fresh approaches and change is occurring. Since the landscape is so different for rural hospitals today, it’s time to consider innovative ways to serve communities. In this interview, Jim Kendrick, president and CEO of Community Hospital Corporation, urges rural hospital leaders to rethink community healthcare. His...


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Blog

5 Ways Rural Hospitals Are Beating the Odds

Rural hospitals are critical to the communities they serve, but in many areas their role is changing. Demographics tell the story. Patients tend to be older, and many are uninsured. Populations are declining. The decreases result in fewer inpatient admissions, but they have not reduced the need for emergency care or primary care physicians. The U.S. Census Bureau reports that 20% of the U.S. population is rural, but only 12% of primary care physicians are working in rural areas — and their numbers per capita are declining.

All of these...


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