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Downey Regional Medical Center Talks With Daughters of Charity Health System Ended

DOWNEY, Calif., March 15, 2010 (GLOBE NEWSWIRE) -- Downey Regional Medical Center (DRMC) received word from the Daughters of Charity Health System (DCHS) on Friday that DCHS would not be moving forward and executing definitive agreements for the affiliation of DRMC with DCHS. Daughters of Charity Health System President and CEO Robert Issai expressed regret for the decision, calling DRMC a "diamond-in-the-rough" and "wishing Downey Regional Medical Center success in finding a partner who will ensure its viability in this increasingly complex health care market."

"We are disappointed that DCHS chose to not move forward, but we understand their priorities are with their existing system hospitals," stated DRMC COO Rob Fuller. "We are fortunate to have several other interested parties, and we have already reached out to them to initiate affiliation discussions. Our overall plan remains the same: affiliate with a system, gain their support for our creditors, and emerge from bankruptcy in the early summer," concluded Fuller.

In February, DCHS began exclusive negotiations regarding the potential acquisition of DRMC, a 199-bed, not-for-profit hospital serving Southeast Los Angeles County. DRMC filed for protection under Chapter 11 of the U.S. Bankruptcy Code on September 14, 2009, citing financial systems breakdowns and poor contracts as its reasons for filing. 

DRMC has operated at normal capacity with its full range of services, including its very busy emergency room, throughout the proceedings, and continues to provide excellent care to its patients.

"I want to reassure our patients, our employees, the physicians, and the community that DRMC and its services will continue to be fully open as we continue through the reorganization process, that excellent patient care will continue to be provided, that payrolls will be met, and that operations at the hospital will continue normally. We have begun the hard work of transforming our hospital and we are confident that we will ultimately emerge as a stronger, healthier and competitive community health care provider," said Kenneth Strople, President and CEO of DRMC.

Under the reorganization, DRMC has implemented processes to shield current employees from adverse impacts of the bankruptcy to the extent possible under the circumstances. At the beginning of the case, DRMC petitioned the Bankruptcy Court to allow payment of prepetition wages and benefits, and to maintain the existing benefits and policies during the case. DRMC remains committed to its employees and the community it serves.

As it enters its 90th year of continuing operations, DRMC looks forward to continuing its service to the local community. For more information on the hospital, please visit www.DRMCI.org

CONTACT: Downey Regional Medical Center
         Eric W. Rose
         (805) 624-0572