An Ohio hospital that temporarily suspended services had its application for Chapter 9 bankruptcy rejected, CBS affiliate WTOL reported May 22.
Hicksville, Ohio-based Community Memorial Hospital suspended its services May 19.
Interim CEO Bill Cherry told the news outlet that over the last several months the hospital "put together a plan which we thought was the best way forward for the hospital" and filed papers for bankruptcy reorganization in April, but the tax commissioner did not accept the application.
Chapter 9 bankruptcy allows financially distressed cities, hospital districts and other public entities protection from their creditors while they develop and negotiate a plan for adjusting their debt.
The hospital is continuing to look at other options, including partnerships with other organizations and obtaining funding from external services, according to the report. The hospital's goal is to avoid permanent closures.
The staff was furloughed, and Mr. Cherry said they are working with other area providers to find openings for staff members, according to the report.
The hospital's financial challenges stemmed from an electronic medical records conversion. The 2021 conversion caused Community Memorial to lose six months of revenue. The hospital is also recovering from $25 million in loss due to participating in a commercial lab fraud that hurt its representation and billing abilities.
Community Memorial Hospital did not respond to a request for comment from Becker's.