St. Francis Healthcare System of Hawaii, a creditor of Hawaii Medical Center, effectively blocked the bankrupt entity yesterday from having the exclusive authority to file a reorganization plan in court, easing the way to introduce its own proposal and for other suitors to come forward.

HMC had sought to extend the exclusive period for soliciting acceptance of its plan beyond one year; however, U.S. Bankruptcy Court Judge Robert Faris upheld tomorrow's deadline. The expiration of exclusivity allows other parties to submit alternative reorganization plans that would promptly bring the bankruptcy to a “;successful conclusion,”; Faris said.

“;(The decision) opens the door for us to put together and submit our own plan, which will be beneficial for the other creditors, the community and our health care system,”; said Sister Agnelle Ching, chief executive of St. Francis Healthcare System of Hawaii.

St. Francis—which recently added high-profile Los Angeles-based bankruptcy attorney Bruce Bennett, a heavy hitter in the Hawaiian Airlines and Liberty House bankruptcies, to its lineup—declined to discuss the key elements of its proposed reorganization, including major financial backers, or reveal its time line.

“;While we believe that our plan offers the best option for Hawaii Medical Center to thrive and continue to serve the community, we know that others have their own ideas for restructuring and we welcome their participation in the process,”; said Salim Hasham, chief operations and restructuring officer for Hawaii Medical Center.

Still, the relationship between St. Francis and HMC, comprised of Wichita, Kan.-based Cardiovascular Hospitals of America and a local physicians group, has long been tumultuous. HMC acquired St. Francis Medical Center in 2007 and began the process of converting its two not-for-profit hospitals into for-profit facilities.

Discord rose after HMC filed bankruptcy in 2008 and suspended payment to creditors. In addition, HMC is disputing the value of HMC East and HMC West and has asked the court to determine the amount owed to St. Francis.

Hasham said HMC has worked with secured and unsecured creditors to find a solution in the best interest of its patients and hospitals. It has proposed returning its Liliha hospital, HMC East, to a nonprofit.

“;The restructuring efforts that we began two years ago have yielded significant results,”; he said. “;We have made numerous operational changes at the hospitals, resulting in cost savings, improved efficiencies and positive and consistent financial performance. In fact, we have cut our operational losses by one-half. Our reorganization plan builds on the progress that we've made.”;