Issue link: https://beckershealthcare.uberflip.com/i/1219854
10 CFO / FINANCE Los Angeles hospital closes after purchase deal falls through By Ayla Ellison I t took Verity Health less than three weeks to wind down services at St. Vincent Medical Center, a 366-bed hospital in Los Angeles. El Segundo, Calif.-based Verity, which en- tered Chapter 11 bankruptcy in 2018, an- nounced Jan. 6 that it planned to close St. Vincent Medical Center. Three days later, the bankruptcy court approved the closure plan. Over the following two weeks, St. Vincent Medical Center closed its emergency de- partment, discharged and transferred all pa- tients, referred and coordinated follow-up outpatient appointments to other providers, notified kidney transplant patients about the closure of the transplant program and noti- fied governmental agencies of the closure, according to a Jan. 23 status report. Though the hospital has ended all services, about 20 employees will remain at the facility to assist with maintenance, security and any final wind- down measures. Verity, a nonprofit health system, shut down St. Vincent after a deal to sell four of its hospitals fell through. Officials exhausted all options to keep St. Vincent open before deciding to shut it down, Verity Health CEO Rich Adcock said in a Jan. 6 news release. Since the closure announcement was made, the city and county of Los Angeles have ex- pressed interest in buying the facility and re- purposing it to provide housing for the home- less, according to KCRW. "LA County is best suited to take the lead in turning St. Vincent Medical Center into a facil- ity that could help address our need for more affordable housing, interim housing, and wraparound mental and medical health ser- vices," County Supervisor Hilda L. Solis said in a news release. "Part of my strategy has been to repurpose underutilized or unused County assets to offset our lack of affordable housing. If we are to effectively combat our homeless- ness crisis, we must be innovative and creative in our approach." The closure of St. Vincent does not affect Veri- ty's other three hospitals in California: St. Fran- cis Medical Center in Lynwood, Seton Medical Center in Daly City, and Seton Coastside in Moss Beach. n Tenet on track to meet $450M cost- cutting goal this year, CEO says By Alia Paavola T enet Healthcare improved operational efficiencies last year, cutting $300 million in expenses, its CEO Ron Rittenmyer said during a presentation at the J.P. Morgan Healthcare Conference in San Francisco. The 65-hospital system based in Dallas made the cuts through cen- tralization, overhead reductions, external spend management and off-shoring, Mr. Rittenmyer said, and it is on track to meet its long-term $450 million cost-reduction target this year. Last year, the system refinanced $5.7 billion of debt, which is expected to generate cash interest payment savings of $18 million annually. It plans to scale its ambulatory surgery business in the U.S. via acquisi- tions and spend about $150 million to $175 million annually expand- ing its ASC footprint, Mr. Rittenmyer said. The system also is working in 2020 to turn Confir, its revenue cycle unit, into an independent, publicly traded company. n Aggressive creditor forced hospital chain into bankruptcy, CEO says By Ayla Ellison A mericore Health and its affiliated hospitals were forced to file for Chapter 11 bankruptcy in late December 2019 aer a lender hijacked the compa- ny's bank accounts, Americore Founder and CEO Grant White alleged in court documents filed in January. Mr. White claims Delray Beach, Fla.-based ird Friday Total Return Fund and its principal officer, Michael Lewitt, took control of Americore's bank accounts on Dec. 27 and tried to oust him from his company. Americore and ird Friday formed a loan and security agreement in January 2018. Since then, ird Friday and Mr. Lewitt have had some control over Americore's use of cash, according to the Ellwood City Ledger. Mr. White claimed ird Friday transferred $130,000 out of Americore's bank ac- count on Dec. 30. Without access to those funds, Americore couldn't pay employ- ees or vendors and had to file for bankruptcy. In a Dec. 31 email to Americore's lawyer, Mr. Lewitt said Americore's bankruptcy filing was an "imprudent move that is going to reflect extremely badly on you and your firm when we reverse it." In other emails included in court documents, Mr. Lewitt said he was taking action at the request of states' attorneys general who were investigating Mr. White, according to the report. e bankruptcy case isn't the only legal matter Mr. White and Mr. Lewitt are both linked to. In July 2019, a Tennessee businessman filed a lawsuit alleging Mr. White, Mr. Lewitt, and Jim Biden, a younger brother of former Vice President Joe Biden, each played a role in a scheme to steal his company's business model. n