"The acquisition of Fairmont General by Alecto is a very positive move for both the citizens of Fairmont and surrounding areas,” said Peggy Coster, President and CEO of Fairmont General Hospital, according to a press release. “We are delighted to keep our acute care hospital here in Marion County. This purchase will allow the hospital to make many of the capital improvements that will allow us to better serve our community.”
“We are proud to have Fairmont General Hospital join Alecto Healthcare Services,” said Alecto Executive Vice-President and General Counsel, Mike Sarrao, in the same release. “We believe in community hospitals and in the quality of care they provide. With the ever changing healthcare landscape, Alecto’s mission is to keep independent community hospitals open so that they can continue to provide care to the communities they serve. We have visited Fairmont many times over the past few months and have been very impressed with the friendliness of the staff and the dedication of the physicians and look forward to working with community to ensure Fairmont’s success for years to come.”
Fairmont General filed Chapter 11 Bankruptcy in September of 2013.
A closing date for the sale transaction has not yet been set.
A federal agency could interfere with the pending sale of Fairmont General Hospital out of bankruptcy, just days before the sale was expected to close.
The U.S. Department of Health and Human Services (DHHS) filed an objection on June 16 to the agreement to sell the hospital to Alecto Healthcare Services Fairmont LLC filed in federal bankruptcy court.
The DHHS oversees the operation of Medicare services. In the filing, U.S. attorneys argue that the sale agreement would transfer the benefits of FGH's Medicare status without assuming financial responsibility for all of its debts.
In the court documents, the DHHS claims FGH owes "roughly $6.7 million" in Medicare overpayments while the sale agreement only covers $1.5 million dollar payment to three DHHS accounts.
The DHHS claims the language granting the sale "free and clear of all liens, claims, titles, and encumbrances" aims to transfer the hospital's Medicaid Provider Agreement and billing numbers without approval from the DHHS.
The filing argues the right to adjust Medicare payments can't be separated from the agreement to provide care and bill through the Medicare system:
"It is not an option. It cannot be subtracted or extracted from the Medicare statute, short of a legislative re-design of the Medicare Act itself."
The objection was filed a week before a sales hearing was expected to transfer ownership of FGH to Alecto.
FGH attorney Mike Garrison responded to WBOY 12News with the following statement: "As today is the last day for parties to file objections to the asset sale, we are not surprised that limited objections may be filed by parties. In each case, the objections have been filed by parties with whom we have been discussing their contracts and are being filed only to preserve all rights. It is important to note that none of the objecting parties is attempting to prevent the sale from going through. We believe that these issues can and will be resolved and the limited objections will be withdrawn prior to or at the hearing on June 23. In the unlikely event that limited objections remain during the upcoming hearing to approve the sale of FGH, we are confident that the court will approve the same."