BMC Not Out of the Woods Yet

by Barbara Mastriania

BMC SignSOUTH RENOVO – Bucktail Medical Center administrators have been working diligently to cut costs and pay off debt but filing for Chapter 11 bankruptcy is still a possibility, Chief Executive Officer Timothy Reeves said Monday night at special meeting held to update the community on the health care provider’s financial picture. According to information at the meeting two vendors have filed actions against the medical center for outstanding debt. One has a judgment against it.

Reeves said BMC has until October 15 to either work out a settlement with the vendor or file for Chapter 11 bankruptcy relief. BMC has offered 10 cents on the dollar but has not received a response from the vendors yet.
BMC officials have talked with an attorney to who specializes in health care facilities’ debt and financial options.
Despite its financial problems, Reeves said he expects the medical center to survive. “I see no risk that the hospital is not going to survive,” he said.

Although the center’s debt is significant, BMC has been meeting payroll and needs of residents and patients. There have been no layoffs or job eliminations. 

Most provided services have been brought back in house. The physicians
service is the last outsourced service. Last November BMC officials held a special meeting to inform the public the medical center was in dire financial condition and filing for bankruptcy was a serious consideration.

BMC Corporate members and the board of directors voted at the time to approval the bankruptcy move if necessary. Since then, BMC officials have been taking steps to cut costs and avoid filing for Chapter 11 relief. While they are meeting current expenses they are in default on debt from thepast. “If we had our way we would pay all vendors,” Reeves said. But the center’s total debt is $3,158,000. It does not have three million plus in assets. While the medical center has made strides in cost cutting, income, particularly that from Medicaid and the state lag behind when
services are provided. The state’s payment share for some services provided in 2013 was not received until February 2015. The center in the meantime continues to provide services to keep its Critical Care status.

There have been improvement and progress made. The center showed a loss of $1,281,991 for the fiscal year 2014. Fiscal year 2015 the picture improved some with the loss reduced to $320,482, a swing of $1 million in less than a year. “Yes, we’re better off than we were a year ago,” chief financial officer George Gerber said. “This is a big hurdle, we still have challenges,” Reeve said. “We’ve generated as much savings in house as we can.”

Payment to vendors used for daily services is current within 30 to 45 days, the nursing side census is currently 92 percent occupancy, an agreement is in place to bring a CT Scanner to Bucktail thus adding another income generating service, he said.

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