LRGHealthcare plans to file for Chapter 11 bankruptcy and has received an offer from Concord Hospital to potentially acquire the assets of Lakes Region General Hospital, Franklin Regional Hospital and their ambulatory sites, the hospital group announced Monday.
“For more than a year, the LRGHealthcare Board and leadership team have been exploring strategic options to maintain access to local health care services and stabilize our financial position,” LRGHealthcare President and CEO Kevin W. Donovan said in a letter posted on the hospital group’s website.
“Taking this step will ensure a bright future for our hospitals and medical practices and preserve access to excellent care in the Lakes and Three Rivers Region,” he said.
The hospitals will remain open.
“As we move through this process, nothing changes for LRGHealthcare patients or employees. Our doors will remain open,” LRGHealthcare said on its website.
In April the hospital group said it was furloughing more than 600 employees.
“These aren’t the easiest times for anyone or any organization,” Donovan said at the time, adding it was “somewhat naive” to think that hospitals would be immune to the coronavirus pandemic and acknowledging that LRGHealthcare has struggled financially in recent years.
The nonprofit hospital group had a $12.8 million operating deficit in 2017, the most recent tax returns available.
Laconia Mayor Andrew Hosmer said filing for bankruptcy may have been the best and only thing for LRGHealthcare to do.
“Without the bankruptcy, the hospital would have closed its doors completely,” Hosmer said. “So their being able to discharge the debt and have a structured re-organization is the best thing that can happen to the hospital.”
Hosmer said he is optimistic that “our health care delivery system will be robust in the years to come because of this partnership (between LRGHealthcare and Concord Hospital) and this will have a positive economic impact on our community as well as a very positive impact on quality of life.”
LRGHealthcare is the largest private employer in Laconia and the second-largest in Franklin.
Franklin Mayor Tony Giunta said Monday evening the bankruptcy announcement “is one of those bad-news, potentially good-news stories.”
“What I’ve been told by the leadership at LRGHealthcare is they want to continue to employ people and provide services for people in the entire Lakes Region and they are moving forward robustly with Concord Hospital” to make that happen. “So that’s the bright spot of this dark day,” he said.
Giunta said he spoke Sunday with LRGHealthcare CEO Kevin Donovan who told him “there was a commitment to keep Franklin Regional Hospital open (but) beyond that he did not get into the details of doctors’ offices or labs.”
Gov. Chris Sununu issued a statement Monday.
“This potential acquisition by Concord Hospital is welcome news and provides a path toward long-term financial stability that will allow LRGH to continue to provide critical services for the citizens of the Lakes and Three Rivers region,” Sununu said. “The state has and will continue to provide any resources that are necessary to enable LRGHealthcare to continue services while it navigates this process.”
