Nacogdoches Hospital District
Hospital District
Memorial Matters

Since 1967, when it was established by the Texas Legislature, the Nacogdoches County Hospital District has been providing healthcare to our community. Community healthcare was the focus when the NCHD successfully managed operations of Nacogdoches Memorial Hospital and continues to be the focus as the NCHD prepares again to secure the hospital’s operation.

The elected board members are holding true to their publicly stated Mission, Vision and Values by demonstrating sound financial stewardship of all resources, including the hardworking hospital employees and the invaluable local vendors who trust that their partnership in this important work will be fairly compensated. The Nacogdoches County Hospital District will also continue to provide emergency services for Nacogdoches County through Nacogdoches County EMS, provide comprehensive indigent care, support healthcare employees and patients through the Nacogdoches Memorial Hospital Foundation, Nacogdoches County Healthcare Foundation and Nacogdoches Memorial Hospital Auxiliary, and provide reliable non-emergency transportation services.

Lion Star issued a misleading statement last night about payments from Texas Health and Human Service (HHSC) and recoupment of funds paid in the past. This statement was disingenuous and was most likely and attempt by Lion Star to deflect criticism by the hundreds of citizens that attended last night's board meeting who voiced their feelings about Lion Star's closing the Obstetrics Unit and Garrison Clinic. Lion Star knew about the recoupments before it took over the operations of Memorial Hospital. As has been typical, Lion Star did not communicate with HHSC and did not forward the District numerous communications from HHSC. The district has tried repeatedly over the last 2 years to communicate with HHSC about the issue but has been unable to make progress because the District is not the current operator of the Memorial Hospital. The district has honored its indemnity commitment and wired over $2 million dollars to handle the recoupment due now, and has scheduled a meeting with HHSC to discuss further repayment options. As the District has repeatedly stated in its filings in Federal Court, Lion Star is insolvent. Lion Star's financial woes are of its own making and have nothing to do with the District or HHSC.

The Nacogdoches County Hospital District was shocked and saddened to learn of the recent layoffs, terminations, and the closing of clinics and other services, including the obstetrics unit, by Lion Star at Memorial Hospital. The District played no part in these decisions and condemns them in the strongest possible terms. The District and its legal team are pursuing every option in the Bankruptcy Court to regain control of the operations of the hospital as quickly as legally possible so that Nacogdoches County and Deep East Texas will have access to quality health care. The citizens of Nacogdoches County can be confident that the District will use all its resources to accomplish this mission.

The Nacogdoches County Hospital District (District) attended the Court Ordered mediation on Monday, February 19, 2024, and Tuesday, February 20, 2024, in Houston, Texas. The District prepared a lengthy written mediation statement with a settlement proposal and participated in the mediation in good faith over the course of the two days. The District made multiple attempts to settle the issues related to the bankruptcy filing of Lion Star. Despite the best efforts of the District, mediation was not successful. Depositions and discovery will continue next week and the District looks forward to presenting its motions to the Federal Bankruptcy Judge on March 11th, 12th, and 15th in Fort Worth, Texas.

Hospital district asks judge to let it retake control of Memorial, The Daily Sentinel of Nacogdoches

On November 16, 2023, Lion Star Nacogdoches Hospital, LLC declared bankruptcy in the Northern District of Texas. The case, filed on November 17, 2023, documents 200-999 creditors owed money and unpaid liabilities between $10,000,001-$50,000,000. Excerpts from public records document details of the top 20 vendors and amounts they are owed by Lion Star.

On November 10, the District participated in good faith in court ordered mediation with the hope of reaching an agreement with Lion Star regarding an orderly transition of the operations of the hospital. Unfortunately, an agreement was not reached. The District will continue its efforts to ensure that quality healthcare will be provided to the citizens of Nacogdoches County in a financially responsible manner without the cooperation of Lion Star.

Alleged Default Update:
The parties have entered into an agreement to hold any further action in both the District’s pursuit of a lease default and in Lion Star’s litigation against the District for a period of thirty days. The Court has ordered and the parties have agreed to mediation in a good faith effort to resolve their disagreements and are currently working to schedule that mediation.

Notice of Termination (PDF)

Hospital Facility Lease Agreement (PDF)
Hospital Asset Purchase Agreement (PDF)

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