Emergency! St Joseph HPA Hospital for sale!

The fate of St. Joseph was questioned in June when HPA closed its River Oaks Hospital, which had two campuses in southwest Houston. This closure left pratitioners and employees shocked and scrambling for new facilties to continue serving the public. See my previous blog entry for that story.

HPA who operated the two campuses, filed for Chapter 11 bankruptcy protection in a Delaware court Wednesday. HPA purchased the hospitals from Tenet Healthcare and rebranded them under the River Oaks name. They are the former Twelve Oaks and Sharpstown General hospitals. HPA bought the River Oaks hospitals four years ago in conjunction with a group of physician investors who have lost their investments.

According to the bankruptcy petition, River Oaks notes it has more than 1,000 creditors that it owes between $100 million and $500 million. The hospital said it has between $50 million and $100 million in assets, but notes it does not expect to have funds available to pay unsecured debtors once administrative and other expenses are paid.

Court records list Medical Properties Trust, which owns the River Oaks hospital buildings and land, as an unsecured creditor, but doesn't list the amount owed. HPA paid $125 million for St. Joseph in 2006.

Now the historic St. Joseph hospital in downtown is for sale. Hospital Partners of America has retained Merrill Lynch to shop it around, after purchasing it only 2 years ago. HPA is suffering from liquidity problems and is trying to sell all of its hospitals, but a spokesperson said St. Joseph Medical Center is financially healthy.