Healthcare bankruptcies spiked in 2023 as debt levels and interest rates rose.
Here are 10 major healthcare bankruptcies to know since May 2023:
1. 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. LaVie divested more than 90 facilities since the COVID-19 pandemic, leaving the company with lease liabilities and litigation claims and was unable to negotiate repayment plans with all creditors.
2. Dallas-based Steward Health Care filed for Chapter 11 bankruptcy in May following a months-long saga of financial distress, but will receive financing from Medical Properties Trust to maintain operations at existing hospitals and clinics. Additionally, the system received the green light to auction off its 31 hospitals in June and July. Steward has faced various financial challenges and liquidity issues, citing low reimbursements and increased operating costs.
3. Healthcare tech company Cue Health filed for Chapter 7 bankruptcy in May after the company failed to improve operational efficiency and its capital structure.
4. Primary care provider Cano Health filed for Chapter 11 bankruptcy in February, and will get $150 million in new financing from some of its current leaders. The company also will convert $1 billion in secured debt for a mix of new debt and complete ownership of the reorganized company through equity.
5. In February, Plantation, Fla.-based radiology provider Akumin completed the Chapter 11 bankruptcy process by deleveraging from its debts, which totaled around $470 million when it filed in October.
6. Private equity-owned medical scrub maker Careismatic filed for bankruptcy in January as it logged $833 million in debt. The company reported record sales in 2021 with $687 million in revenue, but demand for medical supplies has since declined amid a decrease in COVID-19 cases.
7. Rite Aid filed for Chapter 11 bankruptcy in October and has shuttered more than 520 locations since.Of the closures, 103 are in Pennsylvania, 101 are in California and 61 are in New York. Although the company is working on a deal with bondholders to exit bankruptcy, the closures are one-fourth of the 2,111 stories it operated in October.
8. American Physician Partners, a medical staffing company based in Brentwood, Tenn., filed for Chapter 11 bankruptcy protection in September after announcing its closure in July.
9. KKR-backed global cancer and cardiac care service provider GenesisCare filed for bankruptcy in Texas Southern Bankruptcy Court June 2023. As part of the restructuring, the company said at the time it aimed to separate its U.S. business from its business in Australia, Spain and the U.K.
10. Nashville, Tenn.-based Envision Healthcare, a physician services company and ambulatory surgery center operator, filed for bankruptcy in May 2023 almost five years after a private equity firm acquired it for $9.9 billion and took the company private. AmSurg, Envision's former ASC arm, has since bought out Envision's ownership share in its ASCs