Greenwood (Miss.) Leflore Hospital has asked state legislators for authorization to file for Chapter 9 bankruptcy should ongoing negotiations with the Mississippi Division of Medicaid not produce a viable repayment agreement.
“An agreed-to repayment schedule is due to Chancery Court by the end of the month,” the hospital said in a Jan. 20 note to staff, obtained by Becker’s. “If no repayment plan is agreed to then the Chancery Court can hear further arguments from [Division of Medicaid] and the hospital on a repayment schedule that will allow the hospital to continue operating. We expect the repayment schedule to be resolved no later than March 1st, which will allow for the hospital to continue to provide services.”
The Leflore County Board of Supervisors and Greenwood City Council have scheduled a meeting to adopt resolutions supporting the hospital’s bankruptcy authorization request. GLH must receive legislative approval as a public hospital district before pursuing Chapter 9 bankruptcy protection. The current legislative session ends in early April.
The bankruptcy request comes after a turbulent period for the hospital, which narrowly avoided closure in December 2025 after a clash with the state Medicaid program over disputed overpayments. While GLH repaid $1.1 million in June 2025 and $900,000 in September 2025 toward an alleged $5.5 million overpayment, a sudden requirement of $2.5 million in December threatened to shutter the facility.
The hospital ultimately secured an agreement that reduced the December payment to $447,000 and delayed future repayments pending resolution of ongoing legal issues.
“GLH is only seeking authority to file bankruptcy in the event it becomes necessary,” the note said. “GLH remains optimistic it will not be necessary. A Chapter 9 bankruptcy, if necessary, ensures that the hospital continues to stay open and provide services, including funding payroll and other operational expenses until its liabilities (primarily to DOM) are resolved. Again, this is just a step that must be taken if we are not successful in the recoupment process.”
Becker’s has reached out to the Mississippi Division of Medicaid and will update this story should more information become available.
At the Becker's 11th Annual IT + Revenue Cycle Conference: The Future of AI & Digital Health, taking place September 14–17 in Chicago, healthcare executives and digital leaders from across the country will come together to explore how AI, interoperability, cybersecurity, and revenue cycle innovation are transforming care delivery, strengthening financial performance, and driving the next era of digital health. Apply for complimentary registration now.
