Inorder to receive the govt. COVID-19 relief funds, hospitals are now unfiling their bankruptcy claims. Per the report on Bloomberg Law, Companies in bankruptcy are not eligible to apply for Paycheck Protection Program loans made available under the Coronavirus Aid, Relief and Economic Security Act, causing them to unfile their claims
Here is a list of three hospitals that definitely engaged in this manner:
Eastern Niagara Hospital refiled for Chapter 11 bankruptcy July 8, two weeks after its previous bankruptcy case was dismissed. The bankruptcy court dismissed the initial case June 24 at the request of the hospital to allow it to apply for a PPP loan.
Faith Community Health System, a single-hospital system based in Jacksboro, Texas, refiled for bankruptcy June 11, about three weeks after its previous bankruptcy case was dismissed. The health system, part of the Jack County (Texas) Hospital District, first entered Chapter 9 bankruptcy, a bankruptcy proceeding that offers distressed municipalities protection from creditors while a repayment plan is negotiated, in February. The bankruptcy court dismissed the case May 26 at the request of the health system. The health system asked the court to dismiss the case to allow it to apply for a PPP loan through a Small Business Association lender.
According to Bangor Daily News, Calais Regional Hospital, based out of Maine, asked a federal judge in July to dismiss its Chapter 11 case so it can seek at least $1.8 million in PPP funding. If the hospital is allowed to temporarily exit bankruptcy, a bank has agreed to extend a PPP loan to the hospital, according to Bangor Daily News.
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