Federal regulators told Parkland Memorial Hospital that it no longer meets the requirements for the Medicare program, but the hospital said it would sign an agreement with the agency that would allow it to continue participating.
The Centers for Medicare and Medicaid Services sent the hospital a notice of termination Friday.
But agency also said it expects the hospital will sign a limited-time agreement next week that would allow Parkland to maintain participation in Medicare.
A CMS spokesman said the "systems improvement agreement" would allow Parkland to bring in external, third-party consultants instead of terminating the hospital's Medicare program.
The CMS-approved consultants would help Parkland comply with the requirements for Medicare and Medicaid.
Parkland said in a statement Friday night that it will enter into a systems improvement agreement with the federal agency.
"We are grateful for this opportunity to work with an outside expert to address the problems identified by CMS," said Dr. John Jay Shannon, Parkland executive vice president and chief medical officer. "This allows Parkland and CMS to be jointly engaged in an aggressive improvement process."
Dallas County Judge Clay Jenkins, the county's top elected official, said the process is a new beginning for Parkland.
"The time has come for a drastic change at Parkland Hospital," he said in a statement Friday. "Dallas County is committed to working with regulators to fix this mess."
CMS investigators found numerous violations during an unannoucned inspection in July.
Parkland submitted a plan to the agency in August to address the health and safety violations uncovered in the inspection. But the agency on Friday released the results of a follow-up inspection on Aug. 31 that also found problems.
CMS said it expects Parkland would sign the systems improvement agreement before Thursday. Otherwise, Parkland's termination from Medicare and Medicaid would be effective Sept. 30.