Huntsville Memorial Hospital Expected to File Bankruptcy

Sharon Raissi

The following story is largely based on reporting from The Huntsville Item.

On Oct. 31, Walker County Hospital Corporation rejected an offer to fund the near-bankrupt Huntsville Memorial Hospital.

Walker County Hospital Corporation is responsible for the operation of the Huntsville Memorial Hospital. Walker County Hospital District, the governmental body that offered the funds, is trying to keep the doors of the Huntsville Memorial Hospital open to the public.

The agenda called for the hospital district to agree to become the corporation’s debtor, which helped the transition process to bankruptcy by better control of asset pricing and fees. However, the corporation had another plan in mind with using a bank out of California as the secured creditor.

Hospital district officials confirmed that the corporation is expected to file a Chapter 11 Bankruptcy by the end of the month.

Hospital Financial Ruin

In 2017, under former Walker County Hospital Corporation CEO Shannon Brown, the corporation became involved with a laboratory scheme that overcharged for routine tests. The scheme led to one hospital closing its doors. At the same time, the corporation expanded their network of facilities to Madisonville, Riverside and Coldspring.

In September 2018, the corporation could not meet payroll and the interim CEO of that time, Micheal Morgan, requested that the district provide subsidies to assist with financial issues.

During this time, the corporation owes $5.4 million in missing rent.

The People

If Huntsville Memorial Hospital ends up closing its doors, the act would change the dynamic of the surrounding areas.

Huntsville Memorial Hospital acts as one of the few hospitals for not only Huntsville, but also the surrounding towns of New Waverly, Willis, Centerville and Madisonville.

The hospital’s services go further than just medical clinics, it has specialists in fields of women’s health, rehabilitation and heart and vascular services.

This is all while trying to keep the bills and pricing open to a wide variety of incomes. According to the 2018 census, the median household income in Huntsville is $32,715 with 34.4% of the community living under the poverty level. On top of the lack of funds, 19% of the Huntsville community under the age of 65 does not have health insurance, according to the census.

Another group of people affected by the doors closing is prisoners living in the local prisons. The prisons do have in-house clinics, but large medical issues are handled on hospital property.

Last Plan

The district has negotiations with Community Hospital Corporation, a non-profit hospital management group, to create a joint-venture. These negotiations will stop in their final stages to wait for the conclusion of the bankruptcy process.

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