MetroSouth Medical Center

MetroSouth Medical Center

Several local legislators have signed a letter requesting the Illinois Health Facilities and Services Review Board (HFSRB) postpone a Sept. 17 meeting in which members will vote on the application to close from owners of MetroSouth Medical Center in Blue Island.

State Rep. Bob Rita, who lives in and serves Blue Island, joined Blue Island Mayor Domingo Vargas, state senators Bill Cunningham and Emil Jones III, and state representatives Fran Hurley, Justin Slaughter, Will Davis, Chris Welch and Kathleen Willis in signing the letter dated Aug. 29.

Gov. J.B. Pritzker, the Department of Human Services, and the Department of Healthcare and Family Services were copied on the letter.

The legislators accused Quorum Health, a Tennessee-based company that owns MetroSouth, of being “dismissive of both the communities impacted by the pending closure and the state regulators tasked with evaluating and ultimately approving the closure.”

They also stated that MetroSouth and Quorum officials “misled” the HFSRB in their application and “have acted to begin closing the hospital” without proper certification.

The HFSRB is scheduled to review the application to close on Sept. 17 at Bolingbrook Golf Club. A copy of the letter and other documents regarding MetroSouth’s application are available on the HFSRB website.

MetroSouth CEO John Walsh announced in June that the hospital had filed its application that month and would close at the end of the year if a new operator wasn’t found, citing low usage and financial shortfalls. He then said in a letter to employees in August that, with no new operator found and with staff already departing, the hospital will close Sept. 30. He said some services had been temporarily suspended because of a lack of staff.

In a statement to The Beverly Review on Sept. 6, Quorum officials said MetroSouth “has not begun winding down operations and will not do so until its application is approved.”

MetroSouth officials previously said the hospital has 314 beds but serves less than 100 patients per day.

Legislators said in the letter that “MetroSouth is a heavily utilized hospital that provides care to medically underserved communities across the south suburbs.”

The HFSRB website contains several letters opposing the closure, although one, signed by the CEOs of seven other Quorum hospitals in Illinois and dated Aug. 27, supports the closure, stating that a delay in approving the application “would hinder Quorum’s ability to meet specific financial obligations” at the Illinois locations “and put our operations at risk.”

MetroSouth officials said they have searched for a new operator for two years.

In August, Dr. Seth Guterman, president of MSMC Management, LLC, said in a letter that his company has negotiated with Quorum to purchase the hospital for several months and accused Quorum of being dishonest.

A purchase price was agreed upon, Guterman said, but Quorum “suddenly deviated from completing the transaction” when its officials required a $1 million non-refundable deposit that was later reduced to $750,000.

Quorum officials said no binding agreement was ever signed and that they had “not been able to agree to terms with any buyer willing to commit to a binding transaction that would continue to operate MetroSouth.”

They said in a follow-up statement that MSMC officials were making “false, incomplete and misleading statements.”

Guterman, an emergency room physician from Chicago, is also president of People’s Choice Hospital, of Oak Brook, which has faced a federal lawsuit for billing fraud and hospital mismanagement.

Quorum officials said they had concerns about MSMC/People’s Choice and “felt the negotiations were no longer productive or in the best interest of MetroSouth Medical Center and the community.”

Guterman did not return a message seeking comment.

Quorum officials said they signed a non-disclosure agreement with People’s Choice in March, then provided a purchase agreement on July 16. Two weeks later, Quorum officials said, People’s Choice/MSMC submitted a revised draft “that included significant changes and essentially watered down the document to essentially be ‘non-binding.’”

Quorum officials said they provided a revised agreement on Aug. 6 that called for People’s Choice to acquire the property and equipment of MetroSouth for free and acquire the hospital’s accounts receivable, valued at $25 million, at a 20-percent discount; Quorum also reduced the deposit to $750,000.

However, Quorum officials said, People’s Choice/MSMC rejected the agreement and “continued to push for language that gave it ‘walk away’ contingencies.”

Meaningful negotiations ended that day, Quorum officials said, and a week later, People’s Choice/MSMC officials indicated they would not agree to the deposit or sign an agreement without those contingencies.

MetroSouth opened in 1905 and was known as St. Francis Hospital until 2008, when it nearly closed but was purchased by Falcon Investors, LLC, and Transition Healthcare Company.

Guterman said in his letter that he was part of the team that purchased and “turned around” the hospital before selling it to Community Health Systems Inc., the former parent company of Quorum, in February 2012.

People’s Choice did not return a message seeking comment.