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PG wins court stay on hospital bailout
Prince George’s County officials yesterday won a temporary court order to avoid having to pay the parent company of Prince George's Hospital Center $2 million in connection with a lawsuit over a disputed bailout package.
The order by the Maryland Court of Special Appeals puts on hold a judge’s ruling last week in a lawsuit filed by Dimensions Healthcare System. The nonprofit company argued it was entitled to $14 million in special county subsidies through next year.
However, county officials appealed the decision and won a stay from the Court of Appeals.
According to a county spokesman, the appeals court ruling puts on hold the $2 million payment and gives Dimensions until Aug. 10 to respond.
Private attorneys hired by Dimensions have previously said they, too, were considering whether to appeal Judge Jackson’s ruling.
The ruling yesterday further complicates Dimensions’ financial situation.
The company said it planned to use the $2 million to help it stay afloat until officials received word from the Internal Revenue Service on a request to put off making millions of dollars in pension payments.
Questions about closure or bankruptcy for the health system, which also runs Laurel Regional Hospital, have surfaced repeatedly over the years and gained urgency when the health system’s chief executive announced a possible closure earlier this year.
During the hearing before Judge Jackson, Dimensions’ attorneys argued the county government had promised to give the company $9 million this year and another $12 million next year to avoid closure.
The county paid $7 million this year but withheld the remaining $2 million after the Dimensions board refused to change the board’s makeup, including ousted chairman Calvin Brown. The board rejected the conditions, prompting county officials to withhold the funding.
The dispute has turned increasingly bitter.
Earlier this year, Dimensions officials blamed the Prince George’s County Council for the collapse of a state bailout package, accusing officials of a breach of public trust.
Meanwhile, Associate County Attorney Raj Kumar told Judge Jackson last week that Dimensions was trying to extort money from taxpayers, and he likened Dimensions to “the Enron of hospitals.”
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