PA Hospital Changes Course, Now Pursuing Chapter 7

Margaret Dick Tocknell, for HealthLeaders Media , April 18, 2012

The trustee for Saint Catherine Medical Center does not believe that "a Chapter 11 reorganization is possible" due to debt and undercapitalization and has requested that the medical center be placed in Chapter 7 bankruptcy instead. That means assets will be liquidated to pay off debts.

Motion to convert Ch.11 case to Ch.7

Motion to convert Ch.11 case to Ch.7


A hearing on the request is scheduled for Wednesday, April 18.

The move comes just a week after attorneys for the Ashland, PA facility filed emergency Chapter 11 bankruptcy papers on behalf of the 67-bed medical center.

Attorney William G. Schwab serves as trustee. On Monday he filed the Chapter 7 papers in the US Bankruptcy Court for the Middle District of Pennsylvania. According to the trustee report filed with the Chapter 7 request, Saint Catherine Hospital of Pennsylvania LLC (dba Saint Catherine Medical Center) has $45,000 on hand and debt in excess of $5.8 million.

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