The U.S. Bankruptcy Court approved Astria Health’s motion to lease the closed Astria Regional Medical Center in Yakima to the state of Washington as part of its coronavirus response.
While there were questions and some concerns raised, creditors supported the motion.
“This is an easy call,” said Judge Whitman L. Holt of the court’s Eastern District of Washington during a telephonic hearing Tuesday. “The coronavirus has been ravaging communities throughout the country and appears to be getting worse over time. It’s important, and the court respects (Astria Health’s) desire and the desire of the state to get in front of this.”
The state Department of Health, which is working with the Federal Emergency Management Agency, or FEMA, wants to use the hospital to house what the state agency anticipates will be an increase of COVID-19 patients in Central and Eastern Washington.
According to an interim agreement, Astria Health would lease the facility to the state for six months, retroactively starting from Monday to Sept. 30. The state would pay $1.5 million a month for the facility.
Astria Health attorney Sam Maizel said the organization is working on the final version of the lease.
Holt said if Astria Health’s major creditors approve of the final lease, he will approve the lease without holding a second hearing.
“These aren’t ordinary circumstances,” Holt said. “Moving expediently is important.”
The state would run any operation at the Astria Regional site. Astria Health would not be involved caring for patients at the location, Maizel said.
“Astria, in this context, is a landlord,” he said. “(The organization is) not going to be providing medical care. They’re providing a site.”
According to an Astria Health statement sent to the Yakima Herald-Republic Monday, the state already has access to the building. Astria Health said the state could have the hospital operational within a few weeks.
An attorney representing the state said during the hearing that officials intend to move forward as “outlined in the motion.” She emphasized that the state needed access to the building so it could leverage federal resources. That would not have been possible if the state did not have a facility to operate.
The state, along with the U.S. Army Corps of Engineers, is assessing potential sites for additional care facilities to increase the state’s patient capacity, said Karina Shagren, a spokeswoman for the Washington Military Department, during a briefing with the Joint Information Center Tuesday. The center provides updates from the state’s COVID-19 response team.
A field hospital, such as the one set up at the CenturyLink Field Event Center in Seattle, is one type of facility, she said. But the state is looking to operate different types of facilities that could be set up as part of the state’s coronavirus response, such as one that would care for a surge of COVID-19 patients.
The field hospital in Seattle will be primarily used to care for non-COVID 19 patients.
Shagren said the Astria Regional facility is being looked at as a care facility, “but nothing has been locked in place.”
During the same briefing, Nathan Weed, director of community health systems for the state Department of Health, confirmed that he and other state officials have been working with Astria Health to convert the hospital into a care facility.
A declaration from Weed was included in a motion filed with the bankruptcy court. There he said the state wanted to lease the Astria Regional facility because “all its beds can be made available immediately for COVID-19 patients.”
Still, it’s a process. “Getting all the pieces in place to reanimate a closed hospital, it takes a little time,” Weed said during the hearing.
Astria Health closed Astria Regional in mid-January, citing the increased financial risk for the organization and its other facilities with the hospital’s continued operation. The closure came several months after the organization filed for Chapter 11 bankruptcy protection, and left Yakima with just one hospital — Virginia Mason Memorial. Astria Health continues to operate hospitals in Sunnyside and Toppenish.
While there were no objections, attorneys for various companies voiced concerns about the status of their leases as well as their creditor position while the state occupies the facility.
The state will use existing equipment still on the site, such as beds. Some of that equipment was leased from various companies.
Maizel said Astria Health would pay companies with equipment used by the state from the monthly rent. However, the state hasn’t decided on the equipment that would be used for a care facility, and it’s uncertain when it would decide.
“They got a lot on their plate,” he said.
Holt also clarified that creditors’ position and rights in the bankruptcy process would not change with the state’s leasing of Astria Regional.