A small hospital in Bloomington, Ind., has filed for bankruptcy with an eye-popping $134 million worth of debt.
Officials at Monroe Hospital, which has 32 beds but only cares for an average of eight patients, told a federal judge that the hospital owes about $121.8 million to a real estate investment trust that is both its landlord and lender.
The 315-worker hospital is located in the college town’s (home of Indiana University) southern suburbs on land owned by an affiliate of publicly traded Medical Properties Trust Inc., which also extended a loan to the hospital, according to documents filed Friday in U.S. Bankruptcy Court in Indianapolis.
For such a small facility, the hospital is carrying quite a debt load, experts said.
“This is an enormous amount of debt,” said Mary Lane, a bankruptcy attorney with Mitchell Silberberg & Knupp LLP in California who specializes in health-care reorganizations. Another expert in that area, Dawn Gideon of the Huron Consulting Group , agreed that the debt amount “appears to be an extremely high number” for the hospital’s size.
An official for Medical Properties Trust declined to comment, though hospital officials provided a few details in court papers on where the numbers came from: