An emergency hearing has been scheduled for Monday afternoon on critical operational funding needed to keep The Villages Health up and running.
The hearing is set for 2 p.m in U.S. Bankruptcy Court in Orlando. It is hoped that the court will approve plan that would enable The Villages Health “to maintain ongoing operations and ensure the availability of essential medical care for its more than 55,000 patients.”
The 55,000 patients, as well as the 900 employees of The Villages Health, are in uncertain waters after The Villages Health CEO Bobby Trinh announced in July that The Villages Health was seeking bankruptcy protection. The bankruptcy is intertwined with “erroneous Medicare coding” that could force The Villages Health to repay as much as $360 million to the U.S. government.
In its latest court filing, The Villages Health complains of an unexpected financial shortfall. The Villages Health is pointing the finger of blame at UnitedHealthcare. The Villages Health claims UnitedHealthcare has withheld in excess of $7.6 million in payments The Villages Health contends it is owed by UnitedHealthcare.
After The Villages Health filed for bankruptcy in July and announced it was hoping to be purchased by Humana’s Centerwell, UnitedHealthcare, which began a partnership in 2013 with The Villages Health to sell Medicare Advantage plans under the coveted logo of The Villages, said it was caught off guard by the bankruptcy and the Hail Mary pass thrown by The Villages to Humana. It appears that UnitedHealthcare is withholding payments to The Villages Health in protest of the hurried sale to Humana.
As part of the emergency hearing, The Villages Health has indicated it needs to borrow $46 million to keep the lights on, up substantially from the $24 million The Villages Health previously said it needed to borrow to maintain operations. Documents show the money is needed to meet a multi-million dollar payroll and other operational expenses.
The Villages Health says it needs “additional funding to absorb the budgetary shortfall due to the UnitedHealthcare funding cuts,” according to a document filed in connection with the request for Monday’s emergency hearing.
The Villages Health is paying well in excess of $12 million in annual rent to The Villages Operating Co. for the use of the primary and speciality care clinics located throughout The Villages. The Villages Operating Co. is owned and operated by the Developer.
The financial and legal turmoil have left the 55,000 patients in The Villages Health in medical limbo.
The legal document prepared in advance of Monday’s hearing states that The Villages Health, “Requires a significant infusion of cash to fund operational expenses and preserve assets, and more importantly, to ensure adequate healthcare for its patients.”
All indications are that The Villages is extremely eager to abandon its nearly decade-and-a-half effort to revive a “Marcus Welby approach to medicine” and to quickly shed financial liabilities connected to the bankruptcy and potential reimbursement of $360 million to the U.S. government. The Villages is hoping to close on the sale to Humana in early October.