Fort Oglethorpe, Ga. -based Hutcheson Medical Center has announced its board of directors has voted to file for Chapter 11 bankruptcy organization.
In a news release, officials with the hospital said they hope by filing for bankruptcy reorganization the hospital will be able to restructure debt to help ensure long-term viability.
"The primary reasons we are filing for reorganization is to implement a reorganization plan that allows the hospital to continue its primary mission of serving the healthcare needs of North Georgia residents," Farrell Hayes, president and CEO of Hutcheson, said in the release. "We also hope that our filing for reorganization will stop the Erlanger foreclosure, give us a fresh start, and allow us to continue taking care of the 160,000 residents in Walker, Dade, and Catoosa."
According to a Times Free Press report, Hutcheson has not repaid a $20.5 million loan from Chattanooga, Tenn.-based Erlanger Health System and is facing possible foreclosure. A civil suit was filed earlier this year against Hutcheson, according to the report. However, Hutcheson claims Erlanger didn't do what it was supposed to while it managed the hospital, according to the report.
While Hutcheson's debt to Erlanger is $20.5 million, its total debt is $60 million, according to the report.
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