Indiana hospital files for bankruptcy, scales back services

Fayette Regional Health System, a single-hospital system based in Connersville, Ind., filed for Chapter 11 bankruptcy protection Oct. 10.

"After exhausting other possibilities, it was clear that Fayette Regional could not continue to operate under mounting debt and tightening financial resources," the hospital said in a press release. "Fayette Regional will now be able to restructure its debt in an effort to obtain financial stability while still maintaining its high level of patient care."

As part of the restructuring, the hospital is closing its obstetric service line on Oct. 19.

"Programs which have offered us the ability to provide these services are no longer in place, and the number of deliveries at our hospital has declined over the last several years," Fayette Regional Health System CEO Randy White told the Connersville News Examiner. "This limited demand for services, declining reimbursements and the need to upgrade our labor and delivery department, have made it hard to continue to provide the deliveries in an effective and efficient manner."

In its bankruptcy petition, the hospital listed its assets as between $10 million and $50 million and listed its liabilities in the same range. Mr. White said Fayette Regional is working with vendors to minimize disruptions of services during the restructuring process.

"This is a reorganization process, we're not closing the doors," Mr. White said. "Reorganization will allow us the ability to align our operations under [the] current healthcare industry to meet the needs of the community."

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