Although Mercy Iowa City has agreed to an initial $20 million offer to sell substantially all its assets to the University of Iowa, hospital officials Wednesday told creditors, retirees and others that they didn’t perform any appraisals or assessments of their property before making the deal.
Of nearly 400 companies or individuals with “nonpriority unsecured claims” against Mercy Iowa City – meaning the hospital owes them money but will pay them back last, if at all, in its bankruptcy restructuring – more than a dozen are litigants who sued and won settlements, awards, or judgments.
Although Mercy Iowa City two weeks ago told participants of its 55-year-old pension plan – via mailed letter – that they will, for now, “continue to receive your monthly pension checks,” hospital leadership Thursday announced the temporary but immediate suspension of three other benefit programs.
Although Mercy Iowa City wants an expeditious sale of its assets – after the 150-year-old hospital filed for Chapter 11 bankruptcy this month – its bondholders and creditors this week asked a judge to tap the brakes to give them time for due diligence and to maximize the “value of the sale.”