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Hillsboro Community Hospital sold to its onetime operators

Staff writer

A Wichita bankruptcy court judge Thursday approved the sale of Hillsboro Community Hospital after learning that no objections had been filed to the proposed sale and no qualifying competing bids had been made.

The hospital was sold to a company with officers who formerly operated the hospital under the company name Rural Community

Hospitals of America and filed bankruptcy in 2011.

Kansas City, Missouri-based Rural Hospital Group Consolidated last month bid $6.9 million to buy the hospital out of bankruptcy.

Larry Arthur, Jim Shaffer, Trent Skaggs, and Dennis Davis, officers of Rural Hospital Group Consolidated, which formed in 2017, previously ran Rural Community Hospitals of America, the firm that managed Hillsboro’s hospital before it was taken over by a receiver that filed for bankruptcy.

Arthur, chief executive officer of the new company, was CEO of the former one. Skaggs, president of the new company, was executive vice president of the former.

Davis, chief legal officer, said the $6.9 million bid for HCH actually was submitted by Hillsboro Hospital, LLC, a subsidiary of Rural Hospital Group’s management company, RHG Consolidated LLC.

Davis told the Pittsburg Morning Sun that Schaffer and other company managers cut ties with former hospital owner Empower HMS in early 2017 because they did not want to be associated with the way Empower was being operated.

Empower formerly owned several hospitals across the country which are now closed amid criminal investigations, lawsuits, and bankruptcy.

HCH has been in bankruptcy court since court-appointed receiver Cohesive Healthcare Management and Consulting filed for Chapter 11 bankruptcy protection in March.

Cohesive was appointed receiver in January after the city of Hillsboro and mortgage-holder Bank of Hays petitioned district court to appoint a receiver.

So far, legal proceedings related to the case have cost the city of Hillsboro $81,465.

Last modified Nov. 21, 2019

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