18 latest hospital bankruptcies, closures

From reimbursement challenges to declining patient volumes and spiraling labor costs, many factors lead hospitals to shut down or enter bankruptcy. 

Below are 18 hospitals that filed for bankruptcy, closed or announced plans to close this year:

1. St. Mark's Medical Center in La Grange, Texas, closed Oct. 12 after it was unable to satisfy its financial obligations. The hospital said it has been paying less than its full mortgage since 2020, but can no longer sustain its $13 million of mortgage debt as revenue sinks and prices rise. St. Mark's cut almost half its staff and several services in January, and in February, it converted to rural emergency hospital designation to preserve its emergency department services and most outpatient care.

2. Herington (Kan.) Hospital, a 25-bed critical access facility, abruptly closed Oct. 9. Leadership informed hospital staff of the facility's closure Oct. 9, and all services were slated to end the same day. The hospital cited ongoing financial struggles and low patient volumes for its decision to close.

3. Gardner, Mass.-based Heywood Healthcare filed for Chapter 11 bankruptcy Oct. 2, citing various challenges "hindering its sustainability." Workforce shortages, supply chain issues and low reimbursement rates contributed to financial instability, according to the health system. Heywood said it also underwent a "costly and lengthy" electronic medical record transition while managing aging infrastructure and a "milestone construction project" — a surgical pavilion set to open in April.

4. Avail Hospital Lake Charles (La.) closed Sept. 29. No reason was given for its closure. The 33,000-square-foot facility was billed as Louisiana's first microhospital when it opened in 2017. 

5. The Hospital at Westlake Medical Center in Westlake Hills, Texas announced Sept. 8 it is filing for Chapter 11 bankruptcy protection. The physician-owned hospital had significant debt before the pandemic, which exacerbated its financial situation. The hospital will continue all its operations during the bankruptcy proceedings. 

6-7. St. Margaret's Health, which has been closed since June, filed two petitions of Chapter 11 bankruptcy for its St. Margaret's Spring Valley (Ill.) and St. Margaret's Peru (Ill.) facilities in August. Peoria, Ill.-based OSF Healthcare has since received approval to take over the Peru facility. Filing for bankruptcy will allow OSF to begin the purchasing process.

8. South City Hospital, a 178-bed facility in St. Louis, closed in August because of ongoing financial challenges. A significant portion of the hospital's patients were uninsured or underinsured, and it changed owners multiple times in recent years, drifting in and out of bankruptcy court. SA Acquisition Group purchased the hospital out of bankruptcy in January 2021.

9. Trinity Regional Hospital Sachse (Texas) filed for bankruptcy Aug. 29. The hospital opened two years ago and since has defaulted on around $70 million of municipal bonds that were issued in 2020. The hospital's owner, which aims to find a buyer, listed assets of $50 million to $100 million and liabilities of $100 million to $500 million on the bankruptcy petition. 

10. Mercy Iowa City has filed for Chapter 11 bankruptcy in the Northern District of Iowa. The filing includes a reference to a letter of intent between Mercy Iowa City and the State of Iowa that outlines a plan to transition the hospital to become part of UI Health Care. The affiliation requires approval from the university board of regents, state of Iowa, and the bankruptcy court. 

11. Martin General Hospital, a 49-bed facility in Williamston, N.C., suspended operations Aug. 3 and plans to file for bankruptcy. The hospital, which lost $13 million in 2022, cited financial challenges related to declining population and utilization trends as reasons for the decision. 

12. Grand Rapids, Mich.-based Corewell Health will close its Lakeview, Mich.-based Spectrum Health Kelsey Hospital in October after a steady decline in admissions. In June, Corewell opened a $12 million care center a few minutes away from Spectrum Health Kelsey. The hospital opened in 1962 and was having problems with aging infrastructure. 

13. Eastern Niagara Hospital in Lockport, N.Y., closed June 17 after years of financial turbulence. In November 2019, the hospital filed for Chapter 11 bankruptcy protection and signed a management agreement with Buffalo, N.Y.-based Catholic Health. The system had been planning to close Eastern Niagara Hospital once its replacement hospital opens. The closure affected 337 employees.

14. San Benito Health Care District, the board overseeing Hollister, Calif.-based Hazel Hawkins Memorial Hospital, voted May 22 to file for Chapter 9 bankruptcy. The hospital said it will remain open and operational "while leadership looks for a strategic partner or buyer."

15. McLaren St. Luke's in Maumee, Ohio, closed May 8 and ceased all outpatient services. Cincinnati-based Mercy Health is acquiring the hospital campus — which includes 12 buildings — from Grand Blanc, Mich.-based McLaren Health Care. Mercy is working with WellCare Physicians Group practices through the transition to maintain the continuity of patient care. Changes will begin after Mercy officially takes over June 1.

16. San Antonio-based Texas Vista Medical Center, part of Dallas-based Steward Health Care, closed May 1. The 325-bed hospital provided healthcare to predominantly lower income residents in San Antonio and South Texas for almost 40 years and had been struggling financially. The closure resulted in 827 layoffs. 

17. Montebello, Calif.-based Beverly Hospital filed for Chapter 11 bankruptcy April 19. The hospital secured $13 million in financing to keep operating as it looked for a buyer. Hospital officials said rising costs outpacing government reimbursement rates were to blame for the situation. Beverly has unsuccessfully attempted to merge with three health systems.

18. Madera (Calif.) Community Hospital filed for Chapter 11 bankruptcy March 10. The hospital officially closed at midnight Dec. 30, after Livonia, Mich.-based Trinity Health's plan to buy the hospital fell through. Trinity already owns and operates Saint Agnes Medical Center in Fresno, Calif. Madera Community leaders had hoped to avoid bankruptcy and explored a number of options, including looking for another organization to take over operations. But without a buyer lined up, the hospital proceeded with the bankruptcy filing. 

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