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  • Last modified 153 days ago (April 17, 2019)

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Attempt to move bankruptcy case out of state denied

Staff writer

An attempt by Hillsboro Community Hospital owner CAH Acquisition Company #5 to have bankruptcy proceedings moved from Kansas to North Carolina proved unsuccessful Thursday.

CAH filed a motion April 4 in United States Bankruptcy Court in the Eastern District of North Carolina seeking to have an HCH bankruptcy case earlier filed in federal court in Wichita, as well as the bankruptcy cases of two other hospitals, transferred to Greenville, North Carolina and consolidated with a bankruptcy case filed there.

The other two hospitals CAH attempted to move into the North Carolina bankruptcy case are Fairfax Community Hospital, Fairfax, Oklahoma, and Lauderdale Community Hospital, Ripley, Tennessee.

On Thursday, after hearing argument from lawyers for HCH, mortgage holder Bank of Hays, bankruptcy trustee Brent King, and lawyers for the Fairfax and Lauderdale hospitals, the North Carolina bankruptcy judge issued a ruling that HCH and the Lauderdale hospital will not be merged into the North Carolina case.

“A separate order will be entered with respect to Fairfax,” judge Joseph Callaway, bankruptcy judge in North Carolina, said in his ruling.

Other hospitals affiliated with hospital management company EmpowerHMS in the bankruptcy case in North Carolina include Oswego Community Hospital, Oswego; Horton Community Hospital, Horton; Washington County Hospital, Plymouth, North Carolina; I-70 Community Hospital, Sweet Springs, Missouri; De Queen Medical Center, DeQueen, Arkansas; and Drumright Regional Hospital, Prague Community Hospital, and Haskell County Community Hospital, all in Oklahoma.

HCH, Prague Community Hospital, Lauderdale Community Hospital, and Fairfax Community Hospital remain open. The others are closed.

CAH in February filed an appeal of the Jan. 18 Marion County district court decision placing HCH into receivership. On March 14, the company notified the Court of Appeals of bankruptcy filing and the appeals court stayed the receivership case. This month CAH filed a motion to dismiss the appeal, but the request was denied because of the bankruptcy case.

HCH remains in receivership by Cohesive Healthcare Management and Consulting until the bankruptcy is resolved.

Last modified April 17, 2019

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