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Bankruptcy proceeding is planned in Sharon Regional sale

There is a hearing planned Wednesday in a U.S. bankruptcy court in Houston on whether to extend the closure notice deadline by two weeks for Sharon Regional Medical Center, part of the Steward Health Care bankruptcy.

The status conference was sought by the Pennsylvania’s top elected attorney, Michelle Henry, who asked for the 14-day extension after, according to court documents filed Sunday, her attorney general’s office was informed by Steward Health it wanted $3 million to pay for the hospital’s losses to keep it open through December or it would begin closing the facility Monday.

As it stands now, the closure notice was extended from Monday to 5 p.m. Wednesday, according to a notice filed Monday afternoon.

The demand — twice the monthly amount Pennsylvania committed to keep Sharon Regional open in September, October and November — was relayed by Steward Health by phone around 4:30 p.m. Wednesday, the start of the four-day Thanksgiving holiday, the filing states.

The request was “very troubling” and “unreasonable,” the filing states.

“In effect, it is a negative notice demand for another $1.5 million, or ‘we start the process to shut down the hospital,'” the filing states.

Documentation to support the larger request was not sent to Pennsylvania until Friday, the filing states.

Meadville Medical Center submitted a letter of intent Aug. 16 to acquire Sharon Regional, contingent on financial support from various third parties and the commonwealth. In early September, Pennsylvania agreed to fund $4.5 million to keep Sharon Regional open through the end of November pending its purchase by Meadville Medical Center, which the document indicates was really the only bona fide nonprofit entity that made an offer.

Other parties, the document states, expressed an interest, but they “were new, much smaller, and undercapitalized start-up for-profit entities.”

Pennsylvania and Meadville Medical Center have been in talks with Medical Properties Trust, the Alabama-based company that owns the land beneath Sharon Regional, but there has been no agreement, the filing states.

The document called the negotiations between Pennsylvania and MPT “advanced” with a resolution “in the near future.”

Talks were slow at first, the filing states, but Pennsylvania filed a lawsuit against MPT in Mercer County Common Pleas Court claiming the sale of the land on which Sharon Regional sits violated a court order approving the sale of the hospital’s nonprofit charitable assets by Steward Health, a for-profit entity.

Pennsylvania wants the real estate returned to the foundation that owned Sharon Regional. A hearing is set for Friday.

Also Monday, Meadville Medical Center joined with the attorney general’s office in the request to extend the closure notice deadline by two weeks.The commonwealth’s motion states the time is needed to continue negotiations with MPT, address Steward Health’s demand of $3 million and “most importantly, save Sharon hospital,”

The hospital, which consists of the 163-bed acute care facility and 19 satellite centers, has more than 750 employees, making it the largest employer in Mercer County, Pa., the filing states.

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