From reimbursement landscape challenges to dwindling patient volumes, many factors lead hospitals to shut down or file for bankruptcy.
At least 47 in the U.S. have closed or entered bankruptcy this year, and the financial challenges caused by the COVID-19 pandemic may force more to do the same.
Lower patient volumes, canceled elective procedures and higher expenses tied to the pandemic have created a cash crunch for hospitals, estimated to lose more than $323 billion this year, according to a report from the American Hospital Association. That total includes $120.5 billion in losses the AHA predicts hospitals will see in the second half of the year.
Below are provider organizations that have filed for bankruptcy or closed since Jan. 1, beginning with the most recent. They own and operate a combined 47 hospitals.
Shands Lake Shore Regional Medical Center (Lake City, Fla.)
Shands Lake Shore Regional Medical Center closed Aug. 31. The hospital, owned by the Lake Shore Hospital Authority, announced in July that it was closing. The hospital said it had to borrow money to maintain operations, and declining patient volume and financial challenges resulted in losses that were unsustainable.
Cumberland River Hospital (Celina, Tenn.)
Cumberland River Hospital closed Aug. 7 and placed its license on inactive status. In a letter to the state health department, the hospital’s owner and CEO cited several reasons for the closure, including severe staffing shortages and the inability to get funding or grants from the state.
Bluefield (W.Va.) Regional Medical Center
Bluefield Regional Medical Center closed July 30. Officials said the decision to shut down the hospital was based on several factors, including declining patient volume and reimbursement rates and significant financial damage tied to the COVID-19 pandemic.
First Texas Hospital Cy-Fair (Houston)
First Texas Hospital Cy-Fair closed July 26, less than four years after opening. Irving, Texas-based Adeptus Health opened First Texas Hospital Cy-Fair in 2016. When the 50-bed hospital shut down, 62 workers were laid off.
Eastern Niagara Hospital (Lockport, N.Y.)
Eastern Niagara Hospital filed for Chapter 11 bankruptcy July 8, two weeks after its previous bankruptcy case was dismissed. The hospital first filed for Chapter 11 bankruptcy in November 2019. The bankruptcy court dismissed the case June 24 at the request of the hospital to allow it to apply for a Paycheck Protection Program loan. Eastern Niagara Hospital President and CEO Anne McCaffrey said the hospital refiled for bankruptcy to continue the debt-restructuring process.
Faith Community Health System (Jacksboro, Texas)
Faith Community Health System, a single-hospital system, refiled for bankruptcy protection June 11, about three weeks after its previous bankruptcy case was dismissed. The health system, part of the Jack County (Texas) Hospital District, first entered Chapter 9 bankruptcy — a bankruptcy proceeding that offers distressed municipalities protection from creditors while a repayment plan is negotiated — in February. The bankruptcy court dismissed the case May 26 at the request of the health system. The system asked the court to dismiss the bankruptcy case to allow it to apply for a Paycheck Protection Program loan through a Small Business Association lender. A Texas bankruptcy court granted the health system’s motion to dismiss May 26 to allow it to apply for the loan. On June 11, Faith Community Health System reentered Chapter 9 bankruptcy.
Our Lady of Bellefonte Hospital (Ashland, Ky.)
Bon Secours Mercy Health closed Our Lady of Bellefonte Hospital in Ashland, Ky., on April 30. The 214-bed hospital was originally slated to shut down in September of this year, but the timeline was moved up after employees began accepting new jobs or tendering resignations. Bon Secours cited local competition as one reason for the hospital closure. Despite efforts to help sustain hospital operations, Bon Secours was unable to “effectively operate in an environment that has multiple acute care facilities competing for the same patients, providers and services,” the health system said.
Williamson (W.Va.) Hospital
Williamson Hospital filed for Chapter 11 bankruptcy in October 2019 and was operating on thin margins for months before shutting down April 21. The 76-bed hospital said a drop in patient volume due to the COVID-19 pandemic forced it to close. CEO Gene Preston said the decline in patient volume was “too sudden and severe” for the hospital to sustain operations.
Decatur County General Hospital (Parsons, Tenn.)
Decatur County General Hospital closed April 15, a few weeks after the local hospital board voted to shut it down. Decatur County Mayor Mike Creasy said the closure was attributable to a few factors, including rising costs, Tennessee’s lack of Medicaid expansion and broader financial challenges facing the rural healthcare system in the U.S.
Quorum Health (Brentwood, Tenn.)
Quorum Health and its 23 hospitals filed for Chapter 11 bankruptcy April 7. The company, a spinoff of Franklin, Tenn.-based Community Health Systems, used the bankruptcy filing to recapitalize the business and reduce its debt load. The company exited bankruptcy in July with about $500 million less debt.
UPMC Susquehanna Sunbury (Pa.)
UPMC Susquehanna Sunbury closed March 31. Pittsburgh-based UPMC had announced plans last December to close the rural hospital, citing dwindling patient volumes. Sunbury’s population was 9,905 at the 2010 census, down more than 6 percent from 10 years earlier. Though the hospital officially closed its doors in March, it shut down its emergency department and ended inpatient services Jan. 31.
Fairmont (W.Va.) Regional Medical Center
Irvine, Calif.-based Alecto Healthcare Services closed Fairmont Regional Medical Center on March 19. Alecto announced plans in February to close the 207-bed hospital, citing financial challenges. “Our plans to reorganize some administrative functions and develop other revenue sources were insufficient to stop the financial losses at FRMC,” CEO Bob Adcock said. “Our efforts to find a buyer or new source of financing were unsuccessful.”
Sumner Community Hospital (Wellington, Kan.)
Sumner Community Hospital closed March 12 without providing notice to employees or the local community. Kansas City, Mo.-based Rural Hospital Group, which acquired the hospital in 2018, cited financial difficulties and lack of support from local physicians as reasons for the closure. “We regret having to make this decision; however, despite operating the hospital in the most fiscally responsible manner possible, we simply could not overcome the divide that has existed from the time we purchased the hospital until today,” the hospital group said in a news release.
Randolph Health, a single-hospital system based in Asheboro, N.C., filed for Chapter 11 bankruptcy March 6. Randolph Health leaders have taken several steps in recent years to improve the health system’s financial picture, and they’ve made progress toward that goal. Entering Chapter 11 bankruptcy will allow Randolph Health to restructure its debt, officials said.
Pickens County Medical Center (Carrollton, Ala.)
Pickens County Medical Center closed March 6. Hospital leaders said the closure was attributable to the hospital’s unsustainable financial position. A news release announcing the closure cited reduced federal funding, lower reimbursement from commercial payers and declining patient visits.
The Medical Center at Elizabeth Place (Dayton, Ohio)
The Medical Center at Elizabeth Place, a 12-bed hospital owned by physicians in Dayton, Ohio, closed March 5. The closure came after years of financial problems. In January 2019, the medical center lost its certification as a hospital, meaning it couldn’t bill Medicare or Medicaid for services. Sixty percent to 65 percent of the hospital’s patients were covered by the federal programs.
Mayo Clinic Health System-Springfield (Minn.)
Mayo Clinic Health System closed its hospital in Springfield, Minn., on March 1. Mayo had announced plans in December to close the hospital and its clinics in Springfield and Lamberton, Minn. At that time, James Hebl, MD, regional vice president of Mayo Clinic Health System, said the facilities faced staffing challenges, dwindling patient volume and other issues. The hospital in Springfield is one of eight hospitals within a less than 40-mile radius, which has led to declining admissions and low use of the emergency department, Dr. Hebl said.
Pinnacle Healthcare System
Overland Park, Kan.-based Pinnacle Healthcare System and its hospitals in Missouri and Kansas filed for Chapter 11 bankruptcy Feb. 12. Pinnacle Regional Hospital in Boonville, Mo., formerly known as Cooper County Memorial Hospital, entered bankruptcy about a month after it abruptly shut down. Pinnacle Regional Hospital in Overland Park, formerly Blue Valley Hospital, closed about two months after entering bankruptcy.
Central Hospital of Bowie (Texas)
Central Hospital of Bowie abruptly closed Feb. 4. Hospital officials said the facility was shut down to enable it to restructure the business. Hospital leaders voluntarily surrendered the hospital’s license.
Ellwood City (Pa.) Medical Center
Ellwood City Medical Center officially closed Jan. 31. The hospital was operating under a provisional license last November when the Pennsylvania Health Department ordered it to suspend inpatient and emergency services due to serious violations, including failure to pay employees and the inability to offer surgical services. The hospital’s owner, Americore Health, suspended all clinical services at the medical center Dec. 10. At that time, hospital officials said they hoped to reopen the facility in January, but plans to reopen were halted Jan. 3 after the health department conducted an on-site inspection and determined the hospital “had not shown its suitability to resume providing any health care services.”
Thomas Health (South Charleston, W.Va.)
Thomas Health and its two hospitals filed for Chapter 11 bankruptcy Jan. 10. In an affidavit filed in the bankruptcy case, Thomas Health President and CEO Daniel J. Lauffer cited several reasons the health system is facing financial challenges, including reduced reimbursement rates and patients leaving the hospital. The health system announced June 18 that it reached an agreement in principle with a new capital partner that would allow it to emerge from bankruptcy.
St. Vincent Medical Center (Los Angeles)
St. Vincent Medical Center closed in January, about three weeks after El Segundo, Calif.-based Verity Health announced plans to shut down the 366-bed hospital. Verity, a nonprofit health system that entered Chapter 11 bankruptcy in 2018, shut down St. Vincent after a deal to sell four of its hospitals fell through. In April, Patrick Soon-Shiong, MD, billionaire owner of the Los Angeles Times, purchased St. Vincent out of bankruptcy for $135 million.
Astria Regional Medical Center (Yakima, Wash.)
Astria Regional Medical Center filed for Chapter 11 bankruptcy in May 2019 and closed in January. When the hospital closed, 463 employees lost their jobs. Attorneys representing Astria Health said the closure of the medical center, which has lost $40 million since 2017, puts Astria Health in a better financial position. “As a result of the closure, the rest of the system’s cash flows will be sufficient to safely operate patient care operations and facilities and maintain administrative solvency of the estate,” a status report filed Jan. 20 with the bankruptcy court states.