U.S. Healthcare Sector Facing Record-High Numbers of Bankruptcies

More American Hospitals Go out of Business in 2017

The U.S. healthcare sector has witnessed record-high numbers of bankruptcies in the first half of 2017. American hospitals, in particular, continue to face a risk of insolvency in the midst of political uncertainty.

According to a healthcare news magazine, 13 U.S. healthcare companies—including hospitals, nursing homes, pharmaceutical companies, and laboratories—had filed for bankruptcy protection in early 2017. Further, a 14th bankruptcy in the sector was filed just days after Becker’s Hospital Review published its list.

Here’s a short list of the more noteworthy names.

1. Oconee Regional Medical Center, a hospital in Georgia, filed for bankruptcy protection on May 10.
2. Campbellton-Graceville Hospital, in Florida, went out of business on May 5.
3. Adeptus Health, a publicly traded company based in Texas—and the largest and the oldest operator of freestanding emergency rooms in the state—declared bankruptcy in April.
4. Unilife Corporation, a Pennsylvania-based public pharmaceutical company, sought Chapter 11 bankruptcy protection in early April.
5. Louisiana Heart Hospital shut down all of its clinics and went out of business in February.
6. Vital Wellness Home Health, a nursing home in Illinois, went bankrupt in March after struggling with a debt load that was double that of its assets.
7. Bostwick Laboratories, a Virginia cancer-focused pathology lab, went out of business in March after massive debts piled up on its balance sheet.
8. 21st Century Oncology, America’s biggest operator of cancer treatment centers, based in Florida, is the latest healthcare company to file for bankruptcy protection in the final week of May.

Bankruptcy protection experts are predicting that the U.S. healthcare sector will see more bankruptcies in 2017, should the U.S. Senate approve the repeal and replacement of the Affordable Care Act (dubbed Obamacare). (Source:

The Donald Trump administration has planned to pull the plug on the healthcare insurance covered under Obamacare. Should that happen, insurance reimbursements will be declining for hospitals and care providers. At the same time, mounting debt burdens will likely force them to default on their obligations.

Many local hospitals are already teetering at the brink of bankruptcy, and are expected to be pushed out of business if Trump’s American Health Care Act (AHCA) replaces Obamacare.

Sources:

13 healthcare bankruptcies so far in 2017,” Becker’s Hospital Review, May 20, 2017;

21st Century Oncology Files for Chapter 11 Bankruptcy”, The Wall Street Journal, May 25, 2017.

Retail, Energy Sectors Lead 2017 Restructurings, Topping Healthcare”, PR Newswire, May 22, 2017.)

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