OKLAHOMA CITY — An order issued last week by Oklahoma City federal bankruptcy judge T.W. Weaver clears the way for the sale of the bankrupt Moore Medical Center, court documents show.

Weaver's order, which was filed Jan. 23, states that "all objections to the motion (filed earlier by HCI Special Purpose Corporation and which could have derailed the hospital's sale) have either been resolved or should be overruled and the motion as modified in open court ... should in all aspects be granted."

That order apparently opens the door for the facility to be sold to MMC Holdings, LLC and Oklahoma Healthcare Systems, LLC.

MMC Holdings was formed by doctors from the Moore facility and the surrounding area; records show Oklahoma Healthcare Systems was founded Dec. 29, 2006.

The joint bid by both companies totaled about $49 million and, according to an official with the group, is now the top bid for the facility.

"We're in the lead," Fred Minter, a representative of MMC-Oklahoma Health Care, told The Transcript last week. "We're the only bidder that's currently there."

Last Tuesday, Minter, along with Oklahoma City attorney Brad Carter and Stan Carter, CEO of Carter Healthcare, met with Moore Mayor Glenn Lewis and Moore City Manager Steve Eddy seeking their help in obtaining property tax exemptions for the hospital. Lewis said Carter told him the trio represented the MMC Holdings-Oklahoma Healthcare group.

"They told me they were going to buy the hospital," Lewis said. "And that Mr. Carter (Stan) had been elected to represent the physicians' group at the meeting."

Lewis said Moore city officials told the men they would "do all they could" to help keep the hospital open, but added city officials couldn't offer property tax exemptions.

That meeting was held the same day Weaver's order was issued.

The MMC-Oklahoma Healthcare bid is about $6 million less than a earlier, "stalking horse" bid by Acadiana Healthcare of Oklahoma. That bid totaled about $55 million but was thrown out after one of the hospital's major creditors -- HCI Special Purpose Corporation -- objected to the offer because "HCI was not satisfied with either Acadiana's treatment of the HCI collateral or with Acadiana's financing."

The company also opposed Acadiana's offer because Acadiana, it said, had "failed to deposit the $1 million security deposit required by its 'stalking horse' status."

Weaver's order also effectively eliminates a bid made by Norman Regional Hospital.

Lisa Beckloff, a NRH spokeswoman, told The Transcript earlier this month that Norman hospital officials "do not know whether (their) bid will be accepted."

Beckloff said NRH officials attended meetings Jan. 10 about their bid, but added that "...the other bidder also met with the committee the same day. We have not heard anything from them since that time."

Though Weaver's 20-page order takes MMC Holdings-Oklahoma Healthcare Systems a few steps further toward purchasing the bankrupt hospital, it also reveals more details surrounding the hospital's bankruptcy, including the funds owed to HCI and the fact the Moore hospital -- despite continuing to generate millions in revenue -- could be forced to close its doors by the end of February if a buyer isn't found.

In his order, Weaver outlined the hospital's rapidly deteriorating financial health.

"The debtor (the hospital) has a post petition negative cash flow of more than $5 million to date," Weaver wrote. "And a total negative cashflow of $7 million is anticipated by Feb. 28."

The facility, the judge said, is currently operating with a $7 million loan from Hall Financial. "It is by no means certain that the debtor can obtain further debtor-in-possession financing from Hall once the present $7 million commitment is fully used," Weaver wrote.

Further, before the hospital's sale can be completed, administrators and the hospital's new buyer must receive approval from the Oklahoma Department of Health. That process, court documents show, requires 30 days.

"Therefore it is imperative that any proposed purchaser file change of ownership paperwork with the Oklahoma Department of Health by no later than Jan. 28, so the debtor can close before it runs out of cash," the judge said.

Court filings show that HCI's collateral includes the Moore hospital's accounts receivable -- before the bankruptcy petition -- along with the facility's provider agreements with Medicare and Medicaid, the hospital's contract with third-party payers such as Blue Cross, Aetna and United Healthcare, the original accounting, medical and patient records, the rights the hospital has with third-party collection agencies and its billing software.

"The settlement impacts the ability of creditors and other parties to pursue claims of the estate against HCI or to contest HCI's security interest," Weaver wrote. "In the event the debtor is unable to consummate a sale or otherwise pay off HCI under the settlement agreement, HCI will be entitled to foreclose on the HCI collateral and receive all of the relief requested."

Should that happen, Weaver said, "the debtor will necessarily cease operations and the case will most likely be converted to one under Chapter 7 of the Bankruptcy Code."

Built in 2005, the Moore Medical Center is one of six rural hospitals owned by The Schuster Group, an Oklahoma City healthcare company. Like the Moore hospital, the Schuster Group filed for bankruptcy protection late last year.

M. Scott Carter 366-3545 scarter@normantranscript.com