Nacogdoches Memorial Hospital discusses bankruptcy possibility w - KTRE.com | Lufkin and Nacogdoches, Texas

Nacogdoches Memorial Hospital discusses bankruptcy possibility with hospital directors

Directors employed by Nacogdoches Memorial Hospital after an emergency called staff meeting to relay confirmation that their employer is considering filing bankruptcy. (Source: KTRE Staff) Directors employed by Nacogdoches Memorial Hospital after an emergency called staff meeting to relay confirmation that their employer is considering filing bankruptcy. (Source: KTRE Staff)
Gary Kendrick, Nacogdoches, Memorial Hospital CEO, tells staff bankruptcy filing could lay the foundation for a brighter future. (Source: KTRE Staff) Gary Kendrick, Nacogdoches, Memorial Hospital CEO, tells staff bankruptcy filing could lay the foundation for a brighter future. (Source: KTRE Staff)
Lisa King, Board President for Nacogdoches Memorial Hospital, says, "There will be no lock on our door." (Source: KTRE Staff) Lisa King, Board President for Nacogdoches Memorial Hospital, says, "There will be no lock on our door." (Source: KTRE Staff)
Nacogdoches Memorial Hospital is within a hospital district with legal protections in the face of insolvency. (Source: KTRE Staff) Nacogdoches Memorial Hospital is within a hospital district with legal protections in the face of insolvency. (Source: KTRE Staff)
NACOGDOCHES, TX (KTRE) -

Nacogdoches Memorial Hospital district is considering filing bankruptcy. Old and recent debts have escalated the hospital district's financial hardships. 

Directors were briefed on the situation Tuesday. On Thursday, the board will hear proposals from two law firms.

Some directors at Nacogdoches Memorial Hospital lingered behind after hearing confirmation that their employer, Nacogdoches Memorial Hospital, is considering bankruptcy. It's a new experience even for CEO Gary Kendrick. 

"We owe vendors about, between 10 and 11 million dollars, and most of that is old debts that we inherited,” Kendrick said.

First on employees' minds are their jobs and paychecks.

"Every day when we get money coming in, and we do have money coming in, we set aside so much per day so at the end of that two-week period we have enough for payroll, payroll taxes, for pensions, our contribution etc."

Vendors will likely have to wait for their payment if the board approves filing bankruptcy. 

"The plan is not to walk away from our vendors, both local and national,” Kendrick said. “The goal is to work out what's best for this hospital, so we can satisfy all those debts and continue to move forward."

The debt skyrocketed over a 2 ½-year period beginning in 2016 under previous management, according to Board President Lisa King. At the same time, King pointed to government reimbursement cuts, no Medicaid expansion in Texas and hospital construction creating a $50-million bond indebtedness.

Help was needed. Following a board-requested audit, the Community Hospital Corporation, a consulting firm, assumed full management services in February of last year.

"The board never at all had their head in the sand,” King said. “The board never ignored. The board did question. The board has asked. "

Now the board is asking for unity from staff. It begins with directors. 

"We are going to make it through this storm, and the only way we can do it is by working together,” said Almarie Henderson Shumake, the social service manager.

"We now feel kind of that united surge of energy,” said Mindy Winslow, Memorial Hospital’s revenue cycle director. Adrenaline going. And we're going to win."

"We'll pull together as a team,” said Linda Lawson, Memorial Hospital’s chief nursing officer. We still provide the same quality care that we always have."

"There will be no lock on our door,” King said. “We will be here tomorrow, and we will be here 10 years down the road continuing to take care of the people of Nacogdoches."

The Nacogdoches Memorial Hospital Board will meet with two law firms during Thursday night's board meeting.

If the board approves filing for bankruptcy, the lengthy process begins. The hospital district’s administration said town hall meetings will follow. 

For more information on Nacogdoches Memorial Hospital, click this link.

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