Without a potential buyer stepping up, the financially troubled Madera Community Hospital filed for bankruptcy Friday.
The 106-bed hospital closed in late December, laying off more than 700 employees and eliminating a vital medical resource for a region with more than 160,000 people, many of whom are low-income and some who are uninsured.
The hospital also operated rural health clinics in Chowchilla, Madera and Mendota, all that closed on Jan. 10.
Hospital officials blamed several factors for its demise, including a shortfall in government reimbursement fees and health plan fees for the services it provides and the COVID pandemic that strained the hospital’s already anemic financial resources.
Despite efforts to increase revenue, the hospital was losing $2 million to $2.5 million a month during 2022, according to court records.
The hospital’s Chapter 11 bankruptcy filing shows assets of between $50 million to $100 million and debts between $10 million and $50 million.
Its largest secured creditors are Trinity Health, owner and operator of Saint Agnes Medical Center, that is owed $15.4 million; and New England Sheet Metal and Patterson Drywall, which are owed a combined $1.1 million. The hospital also owes its former employees $2 million.
Karen Paolinelli, the hospital’s chief executive officer, describes in court records how one of its last hopes for staying open fell apart. The hospital was negotiating a possible affiliation with Trinity Health but when the plan was presented to California Attorney General Rob Bonta, he proposed conditions that were unacceptable to Trinity Health.
This story was originally published March 10, 2023 6:26 PM.
