Mediator appointed in UMC, Children’s Hospital dispute; healthcare ombudsman approved

El Paso Children’s Hospital had a Chapter 11 bankruptcy hearing Thursday afternoon in the U.S. Bankruptcy Court, Western District of Texas in El Paso with Judge H. Christopher Mott presiding.

Mott appointed Judge Tony Davis to serve as the mediator between Children’s and University Medical Center (UMC).

The mediation will be conducted in the Bankruptcy Court in El Paso on June 25 and the following day if necessary. The mediation proceeding will only be open to the parties involved.

A healthcare ombudsman was also approved during the hearing and is expected to be Suzanne Koenig, a healtcre ombudsman who was listening in on the hearing by phone.

The healthcare ombudsman will be responsible for reporting to the bankruptcy court no less than every 60 days on the patient and quality care of the hospital.

Mott and Davis have a little bit of a history.

Davis is a bankruptcy judge in Austin and according to multiple online sources, when he was in private practice he was a lead attorney in the $6.5 billion ASARCO bankruptcy case, which included the El Paso site.

Mott, the bankruptcy judge overseeing the Children’s bankruptcy case, was hired to represent the City of El Paso in the ASARCO bankruptcy case.

After the hearing, Children’s CEO Mark Herbers issued the following statement:

“We accomplished all of our objectives and all of our motions that were heardtodaywere approved. Judge Mott granted our motion to have EPCH and UMC attend and participate in mediation with an independent mediator, as well as the motion to have the court appoint a healthcare ombudsman for EPCH.We are optimistic about the outcome of the mediation. After a year and half of unfruitful discussions with UMC, we are looking forward to entering into a process that the public can trust. And, if agreements can be reached in the mediation process, those agreements will be binding. All of this is good news for EPCH.”

A mediated agreement would have to be approved by the judge and El Paso County Commissioners Court.

“We are very positive that this is going to be a productive and worthwhile mediation session. We’re going to go into this one hoping for the best of luck and that this one will be more successful than any of the others we’ve had,” UMC spokesman Ryan Mielke told ABC-7 after the hearing.

County Judge Veronica Escobar said UMC is going to approach the mediation with as much zeal as possible.

“We are really hoping to get this concluded during mediation,” Escobar told ABC-7 after Thursday’s hearing. “The reason we want a quick resolution is, of course, No. 1, to create stability at the hospital – both hospitals actually need stability; No. 2, because we want to stop the bleeding. Every month that this goes on, the downside of the bankruptcy declaration is all the money that is now leaving El Paso to essentially feed the machine that is the bankruptcy process.”

Escobar added she would like resolution as quickly as possible because she believes that Children’s money should be going to pay its bills to Texas Tech and to the local property taxpayer and providing healthcare for El Paso’s kids.

Escobar said she hoped that more people from Children’s would have attended the hearing, especially since there are only five board members left out of the 11-member-board. She said Herbers and Children’s two out-of-town attorneys attended the hearing for Children’s side, while she, two County Commissioners, three people from the County Attorney’s Office, UMC board member Tracy Yellen, and Mielke attended the hearing for UMC’s side.

“I think it’s imperative that everyone, regardless of which side you’re on – UMC side or Children’s side — that those of us who are here locally, that we try our best to determine our fate locally. It’s within their purview to put it in the hands of the folks they brought in for this. But I would have hoped that they would have been there to listen for themselves at what the judge had to say,” Escobar said.

The next bankruptcy hearing is set for9:30 a.m. July 14 at the El Paso Bankruptcy Court Room.