A hospital in another state recently filed for bankruptcy. The Chapter 11 bankruptcy filing comes just a couple of years after its opening. The goal of such a bankruptcy filing in the state of Massachusetts and elsewhere is to strengthen the organization financially so that it can be successful long term.
The CEO who has decided to move forward with the bankruptcy filing assumed leadership of the hospital back in Oct. 2016. He is the third CEO of the for-profit institution. Because Chapter 11 was selected, this means that the organization’s debt will be restructured.
The filing is not expected to impact the facility’s daily operations, and none of its approximately 300 workers will be laid off. In fact, the CEO stated that the hospital should remain open to serve the community for a long time. The bankruptcy process is expected to take around five to six months. The CEO noted that the court filing is simply the clearest and most rapid path toward achieving operational success.
Sometimes debt gets out of control due to changes in a business market or industry, or major fluctuations in the economy. However, with Chapter 11 bankruptcy, it is possible to reorganize a company’s finances and thus alleviate its debt burdens so that it will remain sustainable. A Massachusetts business owner will essentially be able to negotiate his or her way to a fresh start financially. An attorney can explain the Chapter 11 process, which is different from other types of bankruptcy filings, and help a company through each stage.
Source: tucson.com, “Green Valley Hospital to file for Chapter 11 bankruptcy“, Stephanie Innes, March 31, 2017