"Financial Crisis at Mercy Iowa City: Receiver Sought to Take Control"

Mercy Hospital-Iowa City, a 234-bed acute care hospital in Iowa City, is facing financial collapse and may be placed in receivership. Preston Hollow Community Capital, the hospital's largest senior secured creditor, has filed a court petition seeking the appointment of a receiver to address unsustainable financial losses and prevent closure. The finance company blames the hospital's board of directors for making decisions that have jeopardized the hospital's mission and ability to meet financial obligations. The hospital disputes the default notice and argues that it has made required bond payments and reduced reliance on traveling nurses. Preston Hollow alleges that the hospital's liquidity has declined by $40 million over the past nine months, with negative cash flow of $2.6 million per month. The hospital's net assets dropped from $96.8 million in 2021 to $55.8 million in 2022.