Bankrupt clinic chain explores transferring operations

The board of trustees for the bankrupt Borrego Health is exploring options for transferring operations of its clinics to another federally qualified health center, the Desert Sun reported Nov. 10. 

The Borrego Springs, Calif.-based clinic chain will send notices to several federally qualified health centers to inform them of the process, according to the report. After offers come in, the board will select an initial bid on the assets of the bankrupt company, while others will have an opportunity to improve on the bid.   

The process will take place through Borrego Health's pending bankruptcy proceedings, according to the report. The board will also need approval from the Health Resources and Services Administration for a transfer to proceed.

California officials had planned to suspend Medicaid reimbursements Sept. 29 after alleging ongoing fraud and mismanagement at the health clinic, but Borrego Health filed for Chapter 11 bankruptcy Sept. 12, which prevented the payment suspension from taking effect. A bankruptcy judge in October blocked health officials from suspending reimbursements.    

The Borrego Health board is looking for an organization that is in a strong financial position, can pay creditors that have previously provided services to Borrego Health and has a track record of providing culturally competent care to farmworkers and LGBTQ and rural community patients, according to the report.

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