In order to make sure there is no lapse in services provided at the Gowanda Urgent Care and Forestville Primary Care clinics, Brooks has asked for approval to lease the clinics from TLC.
Adolph Iannaccone, U.S. Bankruptcy Court Chief Judge Carl L. Bucki's law clerk, said the court adjourned the motion for Brooks to lease the clinics so the federal government could look into the matter because the clinics receive specific federal funding. He said this will be discussed at the Feb. 19 hearing.
Lake Erie Regional Health System of New York Interim CEO Gary Rhodes explained the clinics must be run by a hospital.
"The clinics are classified as Article 28 clinics, which means they are hospital-based and operated as an outpatient service of the hospital. We (LERHSNY) offered to lease the clinics in case TLC closes or it is sold and it is not operated as a hospital. That would be the only way we would lease them. Because of the type of clinics they are, they cannot be operated under anything but an Article 28 hospital," he explained.
According to Rhodes, there is a 90-day opt out period written into the lease in case TLC finds a buyer that would like and is able to run the clinics.
"(The lease) is a place holder to be sure the clinics will continue to be open. Even if it is sold, it is better that there is no interruption in service. If it is sold and the buyer decides not to operate an Article 28 hospital, the clinics would close if we did not have the lease. It is a bit unusual. The lease would continue unless they find a buyer who wants to operate the clinics," he said.
Rhodes added that after Brooks financed renovations to the Gowanda clinic, it has a vested interest in seeing it stay open.
The U.S. Bankruptcy Court in Buffalo must still approve the lease and according to Scott Butler, divisional director of business development for TLC Health Network, the TLC board also has to approve the action.
"It is my understanding that a motion to that effect will be heard on February 19. However, I should make it clear that it would still be up to TLC's discretion as to whether or not we actually wanted to pursue that option. And, it would likely only be an option if we were unable to get a deal done for the sale of the entire organization. So, we really only see it as a contingency option at this point," Butler explained in an email.
Lake Shore Health Care Center operates five outpatient clinics: Forestville primary care, Gowanda urgent and primary care, Cassadaga and Derby chemical dependency and Conewango Medical Center.
LERHSNY filed a closure plan for Lake Shore Hospital, including its clinics, in October. In December it entered into a Chapter 11 bankruptcy reorganization process.
According to hospital officials, since that time there have been about 150 layoffs at the hospital. Three of these positions were at the Conewango clinic which closed on Jan. 31.
"That decision was made based on the severely reduced volume of patients being seen there which led it to it no longer being financially sustainable. There are no plans to reopen that site at this time," Butler said in an email, noting all the other clinics are in operation.
The bankruptcy court will hold a hearing on the lease of the clinics and further funding of Lake Shore's operations on Feb. 19.
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