Quorum's Financial Difficulty Affect On KCH Unknown
July 28, 2016 at 4:25 p.m.
In anticipation of a multimillion-dollar lawsuit settlement Quorum Health Group is expecting to pay within a year, the company recently announced it is exploring various alternatives to ownership and financing options.
Those alternatives include the possibility of a merger, sale or recapitalization.
Kosciusko Community Hospital is one of six northern Indiana hospitals owned by Quorum.
Wayne Hendrix, CEO of KCH, said he is "not too sure" the settlement is the only reason Quorum is looking at alternatives, and the lawsuit goes back many years.
"This is a very old lawsuit and I don't know where we are with that," Hendrix said Wednesday.
Quorum was named in a civil Medicare fraud lawsuit stemming from a whistle-blower's complaints. The lawsuit was unsealed in 1998 and alleges Quorum filed inflated Medicare cost reports. The settlement could be up to $200 million, but Quorum hasn't yet announced any settlement amount.
As for what it all means for KCH, Hendrix said, "It's too soon." However, he said, the results could be very positive. The board of directors is looking for the best means to raise capital for the future, he said.
Hendrix said he is not surprised by the announcement as the board of directors continues to build on the company's strengths as part of their commitment to the hospitals.
"If there was another owner," he said, "I'm sure they'd be very pleased with what they see here. That's only my own personal opinion."
The focus has always been health care, he said, and "we're just going to continue that trend without question."
He said he had no "insights" to what the Quorum board of directors is planning, but "as soon as I know something, I'll be willing to share that with you."
Quorum will review all their options, he said, and any decision they make will be disclosed because they are a public trading company.
"I do have faith in our company. They are a very moral company. They're a strong supporter of the community. Quorum allows decisions to be made 100 percent in Kosciusko County," he said.
Quorum owns 21 hospitals and manages approximately 215 nationwide. The fourth largest investor-owned hospital chain, it is also the largest manager of nonprofit hospitals.
The company was created in 1989 when HCA Management Co. was spun off to a group of investors and employees by Hospital Corp. of America.
The hospital industry has been receiving lower Medicare and Medicaid reimbursements from the government in the last two years, Hendrix said, and may be another reason Quorum is looking toward financial alternatives.
Quorum bought KCH in 1999. [[In-content Ad]]
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In anticipation of a multimillion-dollar lawsuit settlement Quorum Health Group is expecting to pay within a year, the company recently announced it is exploring various alternatives to ownership and financing options.
Those alternatives include the possibility of a merger, sale or recapitalization.
Kosciusko Community Hospital is one of six northern Indiana hospitals owned by Quorum.
Wayne Hendrix, CEO of KCH, said he is "not too sure" the settlement is the only reason Quorum is looking at alternatives, and the lawsuit goes back many years.
"This is a very old lawsuit and I don't know where we are with that," Hendrix said Wednesday.
Quorum was named in a civil Medicare fraud lawsuit stemming from a whistle-blower's complaints. The lawsuit was unsealed in 1998 and alleges Quorum filed inflated Medicare cost reports. The settlement could be up to $200 million, but Quorum hasn't yet announced any settlement amount.
As for what it all means for KCH, Hendrix said, "It's too soon." However, he said, the results could be very positive. The board of directors is looking for the best means to raise capital for the future, he said.
Hendrix said he is not surprised by the announcement as the board of directors continues to build on the company's strengths as part of their commitment to the hospitals.
"If there was another owner," he said, "I'm sure they'd be very pleased with what they see here. That's only my own personal opinion."
The focus has always been health care, he said, and "we're just going to continue that trend without question."
He said he had no "insights" to what the Quorum board of directors is planning, but "as soon as I know something, I'll be willing to share that with you."
Quorum will review all their options, he said, and any decision they make will be disclosed because they are a public trading company.
"I do have faith in our company. They are a very moral company. They're a strong supporter of the community. Quorum allows decisions to be made 100 percent in Kosciusko County," he said.
Quorum owns 21 hospitals and manages approximately 215 nationwide. The fourth largest investor-owned hospital chain, it is also the largest manager of nonprofit hospitals.
The company was created in 1989 when HCA Management Co. was spun off to a group of investors and employees by Hospital Corp. of America.
The hospital industry has been receiving lower Medicare and Medicaid reimbursements from the government in the last two years, Hendrix said, and may be another reason Quorum is looking toward financial alternatives.
Quorum bought KCH in 1999. [[In-content Ad]]