Iron County Medical Center, USDA seek repayment deal

A federal hearing was held Tuesday morning at the Rush H. Limbaugh Sr. Federal Courthouse in Cape Girardeau for Iron County Medical Center’s (ICMC) Chapter 9 bankruptcy proceedings.

Tuesday’s hearing was held specifically to address the stance that the USDA has taken with regard to payback of a loan issued by the USDA for the ICMC structure once the bankruptcy agreements are complete.

The bankruptcy judge opened the hearing and then immediately called the Department of Justice and ICMC attorneys into a chambers conference. The court continued Tuesday’s hearing until Aug. 6 at 9 a.m. to allow the hospital’s effort to reach a resolution with the USDA to continue.

Although the attorneys are keeping the chamber’s discussion confidential at this point, the hospital’s attorneys are confident a definitive agreement will soon be reached to ensure the hospital will stay open, according to a statement released by ICMC which filed for Chapter 9 bankruptcy in February of last year after many years of financial losses. As part of that court filing, the organization was required to meet with creditors to restructure debts and future payments. 

According to ICMC, the only organization that wouldn’t come to the table in good faith was the USDA.

The USDA threatened to torpedo previous agreements through the court system, according to a statement issued last week by ICMC officials in which ICMC CEO Joshua Gilmore wrote, “Like many rural critical care hospitals around the country, we have been struggling financially for many years. Last year, our board took a major step in filing for Chapter 9 bankruptcy protection as we work toward a more sustainable future while keeping the hospital open. We reached agreements with Medicaid and Medicare to restructure our debt, but USDA officials’ unresponsiveness has been appalling,” said Gilmore.

Three other area rural hospitals have closed in recent years, leaving ICMC, located in the city of Pilot Knob, as the nearest source of medical care for many residents in a large area of the rural Missouri region.

“We are doing everything we can to keep this hospital open and settle our debts in an equitable way,” Gilmore continued in his earlier statement. “We are disappointed that a USDA program designed to help the struggling, impoverished rural communities is actually a bully in disguise, threatening the very healthcare services they are supposed to help provide to our patients.”

The hospital serves the healthcare needs of the residents of Iron County and the surrounding region. Iron County was recognized by the USDA for persistent child poverty and ranks in Missouri’s lowest quartile for life expectancy. 

Iron County was recently ranked by the Missouri Department of Health and Senior Services as having the second highest need for healthcare services among the state’s 115 counties and independent city (St. Louis).

The area has the highest death rate from chronic lower respiratory disease in the state, and its pain management clinic is dealing with an opioid crisis, according to hospital officials.

A hearing was held Tuesday morning at the Rush H. Limbaugh Sr. Federal Courthouse in Cape Girardeau in hopes that the Iron County Medical Center — currently in Chapter 9 bankruptcy proceedings — could reach a repayment deal with the United States Department of Agriculture (USDA) that holds the original loan on the hospital. The hearing has been continued until Aug. 6.

Bobby Radford is a reporter for the Daily Journal. He can be reached at 573-518-3628, or at bradford@dailyjournalonline.com.