Montgomery, Ala.-based Jackson Hospital & Clinic and investor group HumanityCorp have mutually agreed to no longer pursue an affiliation between the two organizations. However, HumanityCorp affiliate Capta Health Partners will continue to provide revenue cycle management services for the hospital.
Jackson Hospital has appointed Allen Wilen, a partner with Eisner Advisory Group, as its chief restructuring officer, according to a statement from retired Brig. Gen. Edward Crowell, chair of the hospital's board. He is joined by Ronald Dreskin, partner in charge of Eisner's healthcare services practice.
"Wilen and Dreskin are leading a team of professionals who are assisting the hospital through the healthcare restructuring process to help accelerate a turnaround," Mr. Crowell said in an Oct. 21 statement. "The addition of Wilen and Dreskin to the leadership team allows other senior leaders to focus on the hospital's day-to-day management while they dedicate themselves to the restructuring."
Last month, Jackson Hospital defaulted on about $60 million worth of bonds, which comprises 86% of its long-term debt, leading S&P Global to lower the hospital's bond rating from "CC" to "D" — the rating agency's lowest bond rating, according to al.com.
The bondholder requested full payment after the hospital failed to make interest payments, but S&P said the hospital's liquidity "is very thin and insufficient to meet the bondholders' demand for full payment," al.com reported.
Mr. Wilen has taken steps to stabilize the hospital's cash position, including arranging for additional financing through the existing lenders and bondholders.
"Negotiations are underway with bondholders to cure the bond interest payment default. The cash infusion will provide the liquidity and runway needed for Wilen, Dreskin, and the senior leadership team to evaluate operations, devise a strategic plan for recovery and growth, and position the hospital for long-term success," Mr. Crowell said.
Next steps for the hospital include:
- Evaluating operations to identify performance improvement opportunities.
- Renewed focus on improving clinical utilization across the hospital, as well as improving internal processes.
- Addressing provider gaps to meet market demand and recruiting staff to increase top-line revenue.
- Building greater engagement from all key constituents, including community, philanthropy, government and payers.
Jackson Hospital said there have been no layoffs as a result of these events.