Board member bankrolls hospital operator with $17M in loans

West Palm Beach, Fla.-based Rennova Health owes one of its board members $17.4 million, plus more than $1 million in interest payments, according to WBIR, which cited the company's latest financial filing. 

Christopher Eric Diamantis, who is one of four members of Rennova's board of directors, has guaranteed loans and lent Rennova millions for major purchases, according to the report. 

Though Mr. Diamantis made several loans to Rennova over the past year and a half, Rennova's hospitals have continued to experience payroll delays and critically low supplies. Rennova closed its hospital in Jamestown, Tenn. in June. The 85-bed hospital abruptly shut down just one day after its Medicare and Medicaid funding was cut off.

Mr. Diamantis serving as a director and lender could present conflicts of interest, University of Tennessee law professor Joan Heminway told WBIR. Another cause for concern is that Rennova's CEO also serves as acting CFO, she said.

Sen. Marsha Blackburn, R-Tenn., recently sent a letter to Rennova seeking information about the financial situation of its hospitals. In his response, Rennova CEO Seamus Lagan said he's working on securing capital for Rennova and its hospitals. He noted that the closure of the hospital in Jamestown, Tenn., in 2019 created a "significant disruption" to Rennova's business strategy.

More articles on healthcare finance:
'Critically understaffed': Lawmakers, patients and staff blast HCA's takeover of Mission Health
How a Massachusetts hospital's faulty data slashed Medicare payments statewide
Hospitals in Missouri, Kansas file for bankruptcy

 

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