Trinity Regional Hospital Sachse, a full-service hospital and emergency room near Dallas, filed for bankruptcy with plans to sell itself just two years after opening.
(Bloomberg) — Trinity Regional Hospital Sachse, a full-service hospital and emergency room near Dallas, filed for bankruptcy with plans to sell itself just two years after opening.
The hospital’s parent entity listed assets of as much as $100 million and liabilities of as much as $500 million in its bankruptcy petition. The hospital is in default on nearly $70 million of municipal bonds issued in 2020, according to data compiled by Bloomberg.
Hospitals — particularly those in rural areas — have suffered tremendously in recent years as they contend with higher labor costs and staffing shortages exacerbated by the pandemic. Meanwhile, rating downgrades have plagued the nonprofit medical sector as facilities continue to struggle.
“This is an example of a hospital faced with competition, the cost of construction and the cost of starting up being enough that it’s really created a very top-heavy balance sheet,” Jon Nash, the chief restructuring officer for the hospital and managing partner at MeadowLark Advisors, said in a phone interview.
The Chapter 11 filing protects Trinity from creditors while it works out a way to repay them. It also allows the hospital to keep operating.
Trinity has been shopping itself prior to the bankruptcy filing and now that process will move into “high gear,” Nash said. The facility is brand new and boasts state-of-the-art equipment, he added.
–With assistance from Lauren Coleman-Lochner.
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