- The Washington Times - Tuesday, June 22, 2010

United Medical Center, a Southeast Washington hospital facing millions of dollars in unpaid tax bills despite receiving $100 million in city funds since 2007, isn’t the only financial challenge looming for its parent company, Specialty Hospitals of America.

The N.H.-based company’s local holdings include the Specialty Hospital of Washington-Hadley, a long-term care facility in Southwest Washington recently hit with more than $500,000 in tax liens filed by the D.C. government, city records show.

But Speciality Hospital’s chairman, Jim Rappaport, is calling the recent liens part of a “pattern of harassment visited upon us” by city officials related to the situation at United Medical Center, which D.C. officials are moving to auction off as early as next month.

“At no time were any requests made of [Specialty Hospital of Washington] entities for information or assertions that any sums were due to the District prior to liens being filed,” Mr. Rappaport said in an e-mail to The Washington Times. “All of the liens are being contested,” he said.

D.C. Attorney General Peter Nickles said Tuesday there was no effort to single out the company. He called arguments that it was singled out because of financial troubles at United Medical Center “pretty weak.”

D.C. tax collectors filed a lien for $510,503 against Specialty Hospital of Washington-Hadley on May 10 that included withholding, sales and property taxes and penalties from July 2008 to March 2010, according to city records.

A separate lien, also filed May 10, lists more than $220,000 in taxes owed by Capitol Medical Nursing Center, a skilled nursing facility that operates under Specialty Hospital of Washington at United Medical Center.

Formerly known as Greater Southeast Community Hospital, United Medical Center is the only hospital east of the Anacostia River and a primary option for health care for many low-income residents.

The D.C. government has poured about $100 million into the hospital since 2007. Last year, the Internal Revenue Service placed a lien for more than $3.8 million against Capitol Medical Group, which is owned by Specialty. The financial problems have D.C. officials considering auctioning off the hospital next month “to protect the city’s investment,” Mr. Nickles said.

In April, the District filed court papers to take over United Medical Center. While the city’s court filing cites “dramatically improved” quality of care at United Medical Center since 2007, officials said their investment now was “at risk.”

D.C. officials later withdrew the proposed court action, saying instead it could be sold to the highest bidder.

Mr. Rappaport has said the financial problems stemmed from a $10 million shortfall in how much the District, through Medicaid and a separate D.C.-funded health plan, was paying the hospital for services. He also said the hospital should have been receiving $12 million for uncompensated care services, when it received $4.2 million in 2008 and $4.8 million last year.



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