Recently, additional hospital bankruptcies have hit the news. With the pandemic still raging on and emergency rooms and wards becoming overcrowded, you’d think that hospitals would have a steady flow of cash to keep them out of the red. This isn’t true at all, as these newest bankruptcies can attest. However, there is one solution at hand – collecting every penny that you can from commercial health insurance companies.
Hospitals That Have Filed For Bankruptcy Protection
From reimbursement landscape challenges to dwindling patient volumes, many factors lead hospitals to file for bankruptcy. At least 32 hospitals across the U.S. have filed this year, and the financial challenges caused by the COVID-19 pandemic may force more hospitals to enter bankruptcy in coming months.
Lower patient volumes, canceled elective procedures and higher expenses have created a cash crunch for hospitals, many of which were already operating on thin margins. U.S. hospitals are estimated to lose more than $323 billion this year, according to a report from the American hospital Association.
Moody’s Investors Service said the sharp decline in revenue and cash flow caused by the suspension of elective procedures could cause more hospitals to default on their credit agreements this year than in 2019.
Most of the hospitals that have filed for bankruptcy this year, which are part of the health systems listed below, are operating as normal throughout the bankruptcy process. At least two of the hospitals that entered bankruptcy this year have shut down.
LRGHealthcare, a two-hospital system based in Laconia, N.H., filed for Chapter 11 bankruptcy Oct. 19. The system entered bankruptcy with a debt load of more than $100 million. LRGHealthcare tried to secure a partner for more than two years to help stabilize its finances. President and CEO Kevin Donovan said filing for bankruptcy was necessary after it became clear that the system’s debt would be an impediment to any deal.
Eastern Niagara Hospital
Lockport, N.Y.-based Eastern Niagara Hospital filed for Chapter 11 bankruptcy July 8, two weeks after its previous bankruptcy case was dismissed. The hospital first filed for Chapter 11 bankruptcy in November 2019. The bankruptcy court dismissed the case June 24 at the request of the hospital to allow it to apply for a Paycheck Protection Program loan. Eastern Niagara Hospital President and CEO Anne McCaffrey said the hospital refiled for bankruptcy to continue the debt-restructuring process.
Brentwood, Tenn.-based Quorum Health and its 23 hospitals filed for Chapter 11 bankruptcy April 7. The company, a spinoff of Franklin, Tenn.-based Community Health Systems, said the bankruptcy filing is part of a plan to recapitalize the business and reduce its debt load. Quorum emerged from bankruptcy in July.
Randolph Health, a single-hospital system based in Asheboro, N.C., filed for Chapter 11 bankruptcy March 6. Entering Chapter 11 bankruptcy will allow Randolph Health to restructure its debt, which officials said is necessary to ensure the health system continues to provide care for many more years.
Faith Community Health System
Faith Community Health System, a single-hospital system based in Jacksboro, Texas, filed for bankruptcy protection on Feb. 29. The health system, part of the Jack County (Texas) Hospital District, entered Chapter 9 bankruptcy — a bankruptcy proceeding that offers distressed municipalities protection from creditors while a repayment plan is negotiated.
Pinnacle Healthcare System
Overland Park, Kan.-based Pinnacle Healthcare System’s hospitals in Missouri and Kansas filed for Chapter 11 bankruptcy Feb. 12. Pinnacle Regional Hospital in Boonville, Mo., formerly Cooper County Memorial Hospital, entered bankruptcy about a month after it abruptly shut down. Pinnacle Regional Hospital in Overland Park, formerly Blue Valley Hospital, closed about two months after entering bankruptcy.
South Charleston, W.Va.-based Thomas Health’s two hospitals filed for Chapter 11 bankruptcy Jan. 10. In an affidavit filed in the bankruptcy case, Thomas Health President and CEO Daniel J. Lauffer cited several reasons the health system is facing financial challenges, including reduced reimbursement rates and patient outmigration. The health system said the bankruptcy process will help it address its long-term debt and pursue strategic opportunities.
While your aged claims (those that have gone through the state-level appeals process and still remain unpaid) may not add up to much when added up against your other claims, but at this point in time, every penny counts. Filing Federal ERISA appeals on all of your aged claims helps you collect this money, as the commercial health insurance companies do owe it to you. Contact us to get started on this process today.