Lion Star Nacogdoches (Texas) Hospital, the group that operates Nacogdoches Memorial Hospital, has filed for Chapter 11 bankruptcy in the Northern District of Texas, according to The Daily Sentinel.
The filing outlines that the hospital owes as much as $50 million to creditors, according to the report. At least 200 creditors have claims against Lion Star, and the largest 20 credit claims total more than $8 million.
In the last three months, two other Texas hospitals have filed for bankruptcy: Trinity Regional Hospital Sachse and the Hospital at Westlake Medical Center in Westlake Hills.
Despite the filing, the hospital is showing signs of profitability and its assets outweigh its liabilities, CEO Sean Fowler told the publication. "We have some entities that we deal with and this is an opportunity to protect our operation. I’m going to leave it at that," he said.
Mr. Fowler said that the bankruptcy process will allow time for the hospital to renegotiate contracts with its landlord, the Nacogdoches County Hospital District.
As part of a 10-year deal, Lion Star took over management and operation of the hospital in July 2021, according to The Daily Sentinel. Lion Star paid the hospital district $3 million for assets including accounts receivable, licenses and inventory, but the hospital district retained ownership of the buildings.
Nacogdoches Memorial Hospital is the only Level III trauma center in Deep East Texas, according to its website. The hospital's breast care center's mammography facility is accredited by the American College of Radiology and its rehabilitation Center is an internationally accredited Center of Excellence.
The hospital district will meet Nov. 27 to discuss next steps.
The hospital did not respond to Becker's request for comment.