Articles Tagged: Mercy Iowa City

In arguing its appeal of a Mercy Iowa City liquidation plan that releases thousands of people and entities from potential lawsuits tied to the community hospital’s demise, its former manager MercyOne said a judge erred and overstepped in confirming the plan.

Continuing its outreach and expansion, in concert with an explosion of health care services in North Liberty, Mercy Medical Center Cedar Rapids is considering offering services at an “off-site location” in Johnson County — where University of Iowa Health Care is building a new 469,000-square-foot hospital and Steindler Orthopedic is constructing a new 35,880-square-foot ambulatory surgical center.

After six months of focusing on transition and “maintaining access” for patients of the former Mercy Iowa City it bought for $28 million in January, the University of Iowa is starting to hone a longer-term vision for its new Medical Center Downtown that includes possible relocation of its obstetrics and midwifery, family medicine, and sleep disorders services.

In the days since Mercy Iowa City’s bondholders raised concerns about dwindling assets available for distribution through a liquidation trust, attorneys, consultants, and advisers for the bankrupt hospital, its creditors, and its pensioners have inundated the court with “final” fee requests totaling nearly $13.4 million.

Three days after asking a judge to get involved in the delayed distribution of Mercy Iowa City’s liquidated assets -- accusing the bankrupt hospital’s management team of poor communication and miscalculation in stalling payments -- Mercy’s bondholders last week finally got back some of the long-sought $62.8 million they’re owed.

Nearly two months after a bankruptcy judge confirmed a liquidation plan for the former Mercy Iowa City’s tens of millions in assets, and more than a month after that plan went into effect, secured bondholders “have yet to receive a single ‘effective date’ distribution.”

After taking over Iowa City’s 150-year-old Mercy Hospital and its handful of clinics in January with a $28 million bid in a contentious bankruptcy auction, the University of Iowa has sold the Mercy clinic in Kalona that it obtained through the process to Washington County Hospital and Clinics for $425,000.

A federal bankruptcy judge on Friday swiftly shutdown a request to pause implementation of a Mercy Iowa City liquidation plan that exposes its former financial manager MercyOne to future lawsuits.

MercyOne — former managing partner of the bankrupt Mercy Iowa City — plans to appeal a judge’s decision earlier this month to confirm a Chapter 11 liquidation plan for the insolvent community hospital that leaves MercyOne vulnerable to lawsuits.

A federal bankruptcy judge on Friday afternoon confirmed a Chapter 11 plan of liquidation for the former Mercy Iowa City hospital, despite push back from its former managing partner MercyOne — which now, under the plan, remains exposed to future lawsuits.

In the face of objections from MercyOne — the Des Moines area health care system that for six years provided management over a troubled Mercy Iowa City — a federal judge is leaning toward approving a long-negotiated liquidation plan for the now-bankrupt community hospital that exposes MercyOne to liability and lawsuits.

Facing concerns and objections from pensioners and other entities owed millions in “unsecured” claims, a bankrupt Mercy Iowa City – by means of attorneys burning through thousands by the hour – have negotiated a proposal for how to distribute the hospital’s limited resources.

Three months after hiring a leader for its complex integration with Mercy Iowa City, University of Iowa Health Care this week announced she has accepted another job and will be leaving in May -- compelling UIHC to initiate a search for a permanent chief administrator of its new downtown campus.

Including $28 million it bid in a bankruptcy auction to buy Mercy Iowa City, $8.5 million it covered of the hospital’s “cash-based operating losses,” and $3.4 million it spent resolving Mercy’s unpaid contract obligations, the University of Iowa’s total cost to acquire the 150-year-old community hospital is expected to reach nearly $40 million.

As part of the University of Iowa’s takeover of Mercy Iowa City – which became official Wednesday and continued UI Health Care’s accelerating expansion statewide – it’s assuming more than 1,000 of Mercy’s contracts, costing $3.4 million to “cure” amounts the former community hospital owed under those agreements.