Bankrupt hospitals get new life amid COVID-19 pandemic

As states and cities across the U.S. prepare for an influx of COVID-19 patients, they're looking at troubled hospitals working through the bankruptcy process as one way to expand capacity, according to The Wall Street Journal.

Astria Regional Medical Center in Yakima, Wash., closed in January, about eight months after its parent system filed for Chapter 11 bankruptcy. The hospital, which didn't have enough revenue to stay afloat just a few month ago, is reopening under a lease deal with the state of Washington to expand capacity for COVID-19 patients.

In Los Angeles, COVID-19 has brought new demand for St. Vincent Medical Center's 366 beds. El Segundo, Calif.-based Verity Health System, which entered Chapter 11 bankruptcy in August 2018, closed St. Vincent in January. Verity agreed to lease the hospital to the state in late March to add beds for COVID-19 patients. The hospital has also secured a $135 million bid from a family foundation created by Patrick Soon-Shiong, MD, the billionaire owner of the Los Angeles Times.

The rapid spread of COVID-19 in some states doesn't leave much time to expand hospital capacity. In the cases involving Astria Regional, St. Vincent and other bankrupt hospitals, judges are acting quickly to ensure these hospitals can be used to help relieve pressure on other medical centers amid the pandemic, according to WSJ.

More articles on healthcare finance:
Tennessee hospital to close April 15
New York hospitals face $400M in cuts
Quorum Health faces bankruptcy as COVID-19 bears down

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