PAULS VALLEY — Unable to reach payment arrangements with some of its creditors, the Pauls Valley Hospital Authority filed for Chapter 9 bankruptcy protection Friday.
The authority runs the 64-bed Pauls Valley General Hospital, one of two hospitals in Garvin County.
One of the hospital's largest unsecured creditors is electronic billing software company McKesson Provider Technologies, which the authority owes more than $571,000, according to court documents.
Federal mandates required the hospital to upgrade its billing record system with new software. However the nonprofit, municipal hospital has been unable to negotiate a payment arrangement with McKesson, and the company has threatened to cut off its access to patient medical records for nonpayment, said Tim Gamble, Pauls Valley mayor and chairman of the hospital authority.
Attempts to reach a representative from McKesson were unsuccessful on Friday.
St. Anthony Hospital parent company SSM Health Care Oklahoma was in the process of negotiating to purchase Pauls Valley General as recently as October, but the deal has since fallen through, Gamble said. SSM has managed Pauls Valley General since February 2012.
“Due to unforeseen circumstances, they have decided that it was in their best interest not to buy the hospital,” Gamble said.
Gamble declined to comment further on why SSM has decided not to purchase the hospital. The deal would have saved the hospital from bankruptcy, as well as paid for $1.5 million in renovations to the hospital operating room and emergency room, he said.
“SSM had offered to bring in enough money that we would have been able to pay off all of our debt — we were counting on that to save our hospital,” Gamble said.
SSM will continue to manage Pauls Valley General, the company said in a statement.
“Consistent with the existing agreement, SSM Health Care Oklahoma is committed to support Pauls Valley General Hospital as it navigates the bankruptcy process,” SSM said in the statement. “Our goal is to work with the Pauls Valley General Hospital Board and Pauls Valley Hospital Authority to find the best long-term solution to provide for the health care needs of the community.”
The hospital authority voted unanimously Friday to approve a bankruptcy filing at a public meeting.
The authority has filed for Chapter 9 bankruptcy, which refers to the section of U.S. Bankruptcy code that allows municipalities and other governmental bodies to seek bankruptcy protection from creditors.
Pauls Valley General will continue to operate as it seeks to restructure its debt, Gamble said.
The authority estimated its total assets and liabilities between $1 million and $10 million, according to a 98-page bankruptcy filing filed Friday in U.S. Bankruptcy Court for the Western District of Oklahoma. Pauls Valley Hospital Authority owes more than $468,500 in state and federal taxes, according to the bankruptcy filing.
SSM Health Care Oklahoma is committed to support Pauls Valley General Hospital as it navigates the bankruptcy process.”
SSM Health Care Oklahoma,