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The distressed hospital sector

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FierceHealthcare reports:

“The healthcare industry’s level of ‘distress’ is far higher than in the broader economy, according to a new report.

“The latest Polsinelli-TrBK Distress Indices for healthcare, which uses Chapter 11 bankruptcy filings for entities with $1 million or more in assets to determine ‘distress’ levels, found that 20 hospitals have filed since 2016.

“About 3 out of 4 of hospitals that filed bankruptcy were in rural areas.

“Chapter 11 filings have decreased by 53% nationwide since 2010, according to the report. But in healthcare, its distress scores increased by 305% in that same window.

“‘I think it’s going to be full speed ahead for a while,’ Jeremy Johnson, the report’s editor and a bankruptcy and restructuring attorney at Polsinelli, told FierceHealthcare. ‘The biggest issue is that no problem has been solved—the issues in healthcare we don’t think are cyclical.”’

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