Citing issues with liquidity and losses of tens of millions of dollars over the past decade, officials from DRMC decided that filing for reorganization would be the best action for the long-term interest of the hospital. DRMC has been in the process of implementing a new business model for the past two years and has had no cash reserves since March 2008, according to the report.
Under Chapter 11, DRMC will receive financial stability, tools for improvement and protection from lawsuits and creditors’ actions. The hospital will continue normal operations and expects to re-emerge within a year, according to the report.
Read the release about Downey Regional Medical Center’s filing for Chapter 11 reorganization.
