As any bankruptcy practitioner knows, laws other than the provisions of the Bankruptcy Code can significantly impact a debtor’s reorganization.
An asset sale is an important strategic option for hospitals and other health care facilities in financial distress.
As we close 2015 with more hospital bankruptcies being filed around the country, the ABI Health Care Committee is expecting an interesting year ahead in 2016.
There is much in the booming health care industry to entice an acquisition or integration. The boom has been accompanied by vast amounts of data digitized as electronic health records and myriad other formats. This data adds great value to health care organizations. Because of its value, data merits exacting protection from loss of any kind.
There has been a significant wave of health care provider consolidation driven by the desire to achieve scale in response to declining patient volumes and reimbursement, increasing costs, health care reform and the need for capital to implement improvements in the delivery of care, development/expansion of their physician networks and to make needed upgrades in IT, especially electronic medical
In his 2009 State of the Union Address, President Barack Obama urged Congress to confront the “crushing cost of health care,” claiming that “[t]his is a cost that now causes a bankruptcy in America every thirty seconds.” Like-minded lawmakers subsequently introduced legislation to provide certain bankruptcy protections for medically
Hospitals and other healthcare providers are facing significant financial and fiscal pressures. The recession and the sluggish recovery reduced personal incomes and, therefore, the demand (if not the actual need) for healthcare services. Pharmaceutical therapies and ambulatory surgical centers had previously reduced hospital admissions and revenues. Reduced reimbursements by Medicare, Medicaid, and private insurers have further suppressed revenues.
The following hypothetical demonstrates the scope and application of §327(a) to competing neighboring urban hospitals: Two nonprofit hospitals are separated by three miles in a densely populated low-income urban community. Holy Mackerel sits at one end of Main Street while Baruch Gefilte is at the other. Both are suffering financial difficulties.
New York, NY
KEWA Financial Inc.
Porzio, Bromberg & Newman, P.C.
Grant Thornton LLP
Perkins Coie LLP
Special Projects Leader
Dentons US LLP
Vernon Hills, IL