Deal to keep Lake Shore open through August
BUFFALO – A deal has nearly been reached which will allow Lake Shore Hospital to remain open through August.
At TLC Health Network’s bankruptcy hearing Monday, attorney for TLC, Jeff Dove, said an agreement has been drawn up that TLC, Brooks Memorial Hospital and its partner UPMC and the Dormitory Authority of the state of New York have agreed upon. He said there is only one part of the agreement that still needs to be signed off on – the budget.
Dove explained due to increased revenues from operations, the hospital is expected to be able to stay open until late July. The agreement would extend the use of cash collateral and allow TLC to borrow $500,000 from DASNY until July 16.
He explained there are conditions within the agreement, which includes a schedule for an appraisal, bid process procedures and other benchmarks.
“DASNY is considering our request. We have not received a letter yet, but based on conversations … we are confident we will receive a commitment,” Dove said.
Chief Judge Carl L. Bucki asked if the creditors committee supports the agreement. Attorney Sara Temes, representing the committee, confirmed it has discussed it and does support it.
He added the schedule will allow TLC to explore all offers.
“Are you looking to sell the hospital in bulk or piecemeal?” Bucki asked.
Dove said TLC is considering all offers, which to date include three interested in one segment of the business, one soft offer for the entire operation and several offers for refinancing the hospital’s debt to allow it to continue its own operation of the facility.
Dove asked for another hearing on June 9, but also for a hearing on June 16 to finalize the agreement with DASNY and Brooks. Bucki said due to two judges’ conferences he will not be available June 11 to 18.
Brooks Attorney James Thoman said he and Dove will work diligently to get the agreement finalized with DASNY by June 9. Dove said they will make that date their goal but may have to change some dates in the schedule to accommodate the issue.
After the hearing Dove said the soft offer has not solidified yet.
“Some things have changed as they have become more familiar with New York regulations. I think it will move forward,” he said.
At the last hearing Dove noted the offer comes from an organization in the health care delivery field, but could not name the organization.
Judge Bucki also approved the order for the Hill Group’s broker contract which was discussed at the last hearing on May 12. Dove said the only change to the contract during that time was excluding the Gowanda and Forestville clinics from a commission because these clinics may be leased by Brooks if the hospital is sold to an entity not qualified to run them.
The next hearing was scheduled for June 9.
Lake Shore Hospital submitted a closure plan to the New York State Health Department last year in October and in December filed for Chapter 11 bankruptcy. No closure date has been set and hospital officials have expressed a desire to keep the facility open for a seamless sale. No offer to purchase the hospital has been accepted, or considered by the TLC board, Lake Erie Regional Health System Board or the bankruptcy court.