ASC leaders are keeping a close eye on the evolving healthcare industry as leaders persevere through bankruptcies, layoffs and closures to help recover from challenges and drive operational performance.
Here 16 bankruptcies, layoffs and closures from 2024 that ASC should know:
Bankruptcies
1. Bangor-based Vision Care of Maine filed for Chapter 11 protection in August, marking the second time the surgery center has filed for bankruptcy. The center has about $2.7 million in unsecured claims, according to court filings.
Vision Care was sued by Besse Medical for breach of contract in May 2023. As of April, the company had more than $4 million in unpaid invoices to the pharmaceutical wholesaler.
2. Dallas, Texas-based Steward Health Care filed for Chapter 11 bankruptcy in May after facing several financial challenges driven by low reimbursements, increased costs and the COVID-19 pandemic. Delays in finalizing the sale of its physician network to Optum led to additional financial issues, according to Steward CEO Ralph de la Torre, MD.
3. Pueblo, Colo.-based Rocky Mountain Eye Center filed for Chapter 7 bankruptcy and planned the closure of its clinics in July. The eye center's board of directors said it was unable to financially recover from the COVID-19 pandemic.
4. Atlanta-based skilled nursing facility operator LaVie Care Centers filed for Chapter 11 bankruptcy in June, citing shifts in labor costs, occupancy and reimbursement rates.
Layoffs
1. Modesto, Calif.-based, physician-owned Stanislaus Surgical Hospital announced its plans to suspend operations indefinitely and lay off employees after CMS terminated its provider agreement. CMS terminated its provider agreement in an Aug. 30 letter for noncompliance with various conditions of participation within the agency's Medicare and Medi-Cal programs.
2. Bloomington, Ind.-based Keplr Vision filed a WARN notice with the state in August to cut 100 members of its workforce. The practice said the layoffs are part of efforts to ensure its practices have the resources and support they need to continue delivering high quality care.
3. Ann & Robert H. Lurie Children's Hospital in Chicago laid off a "very small" number of employees after a comprehensive budget review earlier this year.
4. Houston-based Texas Children's Hospital initiated plans to lay off approximately 1,000 employees, including front-line healthcare workers and those in leadership positions. Linda Aldred, executive vice president and chief human resources officer at Texas Children's, said in August that declining patient volumes and the delayed opening of its Austin campus contributed to a nearly $200 million operating income loss through the first six months of the fiscal year.
5. Washington, D.C.-based George Washington University Hospital, part of King of Prussia, Pa.-based Universal Health Services, laid off "less than 3%" of its employees due to the restructuring in an effort to reduce cost and increase operational efficiency.
6. Pittsburgh-based UPMC announced earlier this year that it would lay off more than 1% of its 100,000 workforce — approximately 1,000 employees — due to ongoing post-pandemic challenges.
Closures
1. Baptist Health-Fort Smith plans to close its outpatient surgery center in Fort Smith, Ark. Jeff Carrier, region president for Baptist Health Fort Smith and Van Buren, said the hospital is looking to integrate its ASC operations with its main hospital operating rooms to enhance service efficiency.
2. Port Arthur-based Medical Center of Southeast Texas, an affiliate of Dallas-based Steward Health Care, closed its campus in Beaumont on Feb. 2. A Steward spokesperson said the medical center found the Beaumont campus to be "severely underutilized given the needs in the region."
3. Canfield (Ohio) Surgery Center closed in June. Employees said that while business had been picking up, the ASC was projected to lose $2.5 million this year.
4. Pueblo, Colo.-based Rocky Mountain Eye Center closed all of its clinics July 31 following 32 years of operation due to financial strain after COVID-19. The closure affects six facilities and 77 employees.
5. MercyOne shared plans to close its MercyOne Primghar (Iowa) Medical Center in September. The closure comes as Des Moines, Iowa-based MercyOne, which is part of Trinity Health, aims to redesign care due to existing economic and workforce challenges.
6. A U.S. bankruptcy judge approved the closure of two Steward Health Care hospitals in Massachusetts in July, months after the organization filed for Chapter 11 bankruptcy. The judge cited how the organization is experiencing "an incredible amount of loss on a weekly basis."