Children’s hospital bankruptcy complaint details disagreement
ABC-7 has obtained a copy of the complaint El Paso Children’s Hospital has filed in federal bankruptcy court.
It details allegations of overcharging and underpayments from University Medical Center to Children’s Hospital. The 29-page complaint questions why EPCH has been asked to pay more than $800,000 a month in rent for the top five floors of the facility, despite taxpayers approving $120 million in bonds to build it.
Children’s claims it was overcharged or underpaid by UMC an overcharge of $27 million for the facility lease, $14 million more for hospital services, underpaid of $15 million for El Paso First reimbursements and another underpayment of $12 million plus for indigent care costs UMC allegedly avoided when those patients went to Children’s instead.
In the complaint, Children’s claims as part of the feasibility study for the hospital in 2007 “a portion of the property tax appropriations attributable to pediatrics (estimated at $3.9 million a year) would be annually paid to EPCH by UMC for relieving UMC of its obligation to provide care for the pediatric indigent population of El Paso County.”
But EPCH CEO Mark Herbers said at Tuesday’s news conference announcing the bankruptcy decision that never happened.
“The feasibility study had many assumptions, but the feasibility conclusions were the basis by which the hospital was promoted and the bond issue ultimately passed,” Herbers said. “Some of those assumptions never came to fruition.”
Herbers also said utility cost charges were a concern. That is also mentioned in the bankruptcy complaint.
“Children’s Hospital is more efficient, yet we were being charged for building services, gas, electric water, etc., based on square feet occupied, not on basis of actual utility cost,” Herbers said.
UMC Board Chairman Steve DeGroat had this to say about EPCH’s complaint: “Any lawsuit complicates things and it just means we’re going to spend more time and money and effort, instead of focusing on providing healthcare services in El Paso.”
This is what EPCH is requesting in the complaint: Declaring a lien UMC put on EPCH be voided, award EPCH reasonable fees and costs, restrain UMC from terminating agreements for services, declaring UMC has no right to rental payments and award EPCH attorney fees.
A UMC official told ABC-7 late Thursday afternoon that,” UMC vehemently disagrees with virtually all of the allegations presented in the El Paso Children’s Hospital adversary filing. UMC will address each of these points in its official response to the court.”
The first court hearing is set for Thursday in Austin.
