The parent company of Galesburg Cottage Hospital is filing for bankruptcy, but plans to keep the hospital open.
Quorum Health Corporation filed for Chapter 11 bankruptcy in federal court on Tuesday. The company cites $373 million in assets and more than $1.2 billion in liabilities.
“This decision comes at a critical time when all hospitals are facing unprecedented challenges related to the coronavirus pandemic,” said Bob Moore, chief executive officer of Galesburg Cottage Hospital in a statement. “This is an important step toward long-term financial stability and will ensure that our hospital has the resources and cash flow needed to address the COVID-19 crisis and continue caring for patients and the community.”
Hospitals across the country are experiencing financial shortfalls as elective surgeries and other revenue-generating procedures are canceled en masse to prepare for surges of COVID-19 patients. So far, Knox County has one confirmed positive case.
OSF HealthCare, the parent company of OSF St. Mary Medical Center,recently announced furloughs for some employees as the network faces down a potential $330 million revenue loss through the end of its fiscal year.
The hospital plans to maintain services, continue paying wages and benefits to employees, and maintain payments to suppliers during the period of financial struggle. Quorum Health said it inherited a large debt load with a high interest rate when the company formed in 2016.
The financial reorganization is expected to be completed in about two months. In Illinois, Quorum Health also operates hospitals in Waukegan, Granite City, Red Bud, Mt. Vernon, Marion, and Anna.
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