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The Southern Regional Medical Center near Atlanta filed for bankruptcy on Thursday while executives look for buyers for the 331-bed hospital, Dow Jones Daily Bankruptcy Review reported today. Officials who put the nonprofit hospital into chapter 11 protection said that the Riverdale, Ga.-based facility faces more than $100 million in debt. The 685,475-square-foot hospital's operations have already drawn interest from potential buyer California-based Prime Healthcare Services, which operates roughly 35 hospitals and has made offers for other bankrupt hospitals. Prime Healthcare would continue to operate the hospital, one of Clayton County's largest employers with about 1,350 people, according to documents filed in U.S. Bankruptcy Court in Atlanta. Read more.  (Subscription required.)

For more on hospital and health care insolvency issues, be sure to pick up a copy of ABI’s Health Care Insolvency Manual, Third Edition.

University Medical Center of El Paso asked a bankruptcy judge to consider a restructuring plan that essentially would allow it to take over El Paso Children's Hospital, the El Paso Times reported yesterday. Under the current bankruptcy proceedings, Children's Hospital has the sole right to file a restructuring plan. In the 35-page motion, the county hospital asked U.S. Bankruptcy Judge H. Christopher Mott to waive that exclusivity and allow UMC present its own plan. The proposed plan is similar to the one previously presented by the county hospital when mediation between the two hospitals failed. UMC said it intends to oversee the pediatric hospital's operations.

A private investment firm will make a $250-million cash infusion in a struggling chain of six Catholic hospitals in California under a deal announced Friday, The Los Angeles Times reported on Friday. BlueMountain Capital Management in New York would also oversee management of the chain, called Daughters of Charity Health System, which would keep its nonprofit status. The Daughters of Charity's properties include St. Vincent Medical Center in Los Angeles and St. Francis Medical Center in Lynwood. BlueMountain also would receive an option to buy Daughters of Charity outright after three years. The proposed deal comes four months after Prime Healthcare Services Inc. backed out of plans to purchase Daughters of Charity for $843 million. Daughters of Charity's future has been closely watched because its hospitals employ 7,600 workers and provide needed medical services to a number of lower-income communities.

Despite earlier predictions that the El Paso (Texas) Children's Hospital bankruptcy would be completed this year, consultants and lawyers for the hospital Wednesday asked that deadlines be extended into next year, the El Paso Times reported today. Children's Hospital asked Bankruptcy Judge H. Christopher Mott to double the hospital's "exclusivity" period. If it is granted, Children's Hospital will have the sole right to file a restructuring plan until Jan. 13. Until March 14, it will have the sole right to negotiate in an attempt to get the hospital's creditors to accept it. In its court pleading, Children's Hospital said that it needs the time because the consultants running the hospital have been preoccupied with other tasks related to the hospital's financial woes.

A federal judge has reversed the orders of a bankruptcy court that had allowed a troubled St. Petersburg, Fla., nursing home to continue receiving Medicare and Medicaid funds, the Tampa Tribune reported today. On appeal, the U.S. District Court in Tampa ruled the bankruptcy court did not have jurisdiction to prevent federal health officials from terminating Bayou Shores SNF, operating as Rehab Center of St. Petersburg, from Medicare. The St. Petersburg facility operated under Medicare and Medicaid agreements until the Florida Agency for Health Care Administration found conditions there constituted immediate jeopardy to patient health and safety, U.S. Attorney Lee Bentley said.

A prominent Kentucky health-care company that once featured University of Kentucky basketball coach John Calipari in its TV ads filed for bankruptcy protection in the face of accusations from Medicare officials that it paid illegal kickbacks to doctors, Dow Jones Daily Bankruptcy Review reported today. Nurses' Registry and Home Health Corp. filed for bankruptcy on Friday in U.S. Bankruptcy Court in Lexington, Ky., demanding that Medicare officials release $1 million in payments for health-care services it provided. The 200-worker company, which provides skilled nursing, physical therapy and occupational therapy to roughly 1,350 patients, takes in nearly $1.3 million a month in Medicare payments, or about two-thirds of its revenue, according to documents filed in U.S. Bankruptcy Court in Lexington, Ky. Medicare officials suspended payments to Nurses Registry earlier this year after suing the company over alleged kickbacks and improper billing. Nurses Registry has denied wrongdoing. Read more. (Subscription required.)

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After a prolonged battle for patients in the midcoast area, Parkview Adventist Medical Center has filed for bankruptcy and intends to merge with its former rival, Mid Coast Health Services of Brunswick, Maine, the Portland (Maine) Press Herald reported today. Parkview said yesterday that its chapter 11 filing includes a plan to merge with Mid Coast. The two hospitals for years have vied for leadership in the Brunswick, Bath and Topsham, Maine region, and in its filing, Parkview suggested that Mid Coast has been winning more patients. Under the proposal, inpatient and emergency services will be consolidated at the Mid Coast campus. Read more. 

For further analysis of hospital bankruptcies and health care insolvency, be sure to pick up a copy of the ABI Health Care Insolvency Manual, Third Edition. 

Health Diagnostic Laboratory Inc. has proposed to spend a $30 million loan from private-equity giant Cerberus Capital Management LP to keep the Virginia lab operating while leaders figure out a survival plan, Dow Jones Daily Bankruptcy Review reported today. Health Diagnostic Laboratory officials said that the Richmond lab, which tests for cardiovascular diseases like diabetes, is low on cash after business slowed and a bank froze the company's account last month, making it tough for the firm to pay suppliers. Health Diagnostic Laboratory filed for bankruptcy on June 7, several months after agreeing to pay nearly $50 million to settle civil allegations filed by the U.S. Department of Justice that it paid doctors to send the company patient blood samples. Justice Department officials said the fees were illegal kickbacks; the lab has denied wrongdoing.