The U.S. Department of Labor is investigating whether the former administrators of Fort Oglethorpe, Ga.-based Hutcheson Medical Center defrauded employees of their retirement and healthcare benefits, according to the Times Free Press.
Hutcheson Medical Center filed for Chapter 11 bankruptcy protection in 2014. Without enough cash flow to support itself, the hospital closed Dec. 4, 2015. However, after securing a buyer, the hospital was able to reopen just three weeks later under new ownership.
The Department of Labor's criminal inquiry focuses on whether Hutcheson's former administrators defrauded employees. Hutcheson was self-insured and employees paid the company every two weeks for their benefits. However, the hospital allegedly failed to pay employees' healthcare claims. In a court document filed in September, Hutcheson's bankruptcy trustee estimated the unpaid claims had reached $2.8 million, according to the report.
In a recently issued subpoena, the Department of Labor requested Hutcheson's bankruptcy trustee meet with an investigator and asked for various documents, including records of payments to former executives, severance packages, bonuses and board of directors meeting minutes.
The subpoena also confirmed the Department of Labor is investigating whether the hospital defrauded employees of retirement benefits, according to the report.
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