3 hospital, health systems filing for bankruptcy in 2025

Becker’s has reported on three hospital and health system bankruptcies since the beginning of 2025:

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Alabama hospital files for bankruptcy

Montgomery, Ala.-based Jackson Hospital and Clinic has sought Chapter 11 protection to allow the facility to implement financial restructuring and reorganize operations. The 344-bed non-profit hospital has dealt with “significant financial pressures” over the last few years due factors like a challenging payer mix, COVID-19, stagnant reimbursement rates, and increased labor costs.

Ohio hospital files for bankruptcy

The Bellevue Hospital in Toledo, Ohio, has filed for Chapter 11 bankruptcy protection and plans to be acquired by Sandusky, Ohio-based Firelands Health. The restructuring and acquisition will allow the hospital to meet its financial obligations while continuing to provide care to patients in the community. 

Bellevue Hospital, a 50-bed facility, faces many of the current pressures common to rural and independent hospitals, including rising operational costs, access to capital, regulatory complexity and funding constraints.

Prospect Medical Holdings

Los Angeles-based Prospect Medical Holdings, a private equity-backed system that owns hospitals across four states, has filed for Chapter 11 protection. Prospect initiated voluntary Chapter 11 proceedings as it works to sell 10 of its 16 hospitals, according to a Jan. 11 news release. All facilities will remain open and patient care will be uninterrupted during the Chapter 11 process. The system also said it will prioritize operating community hospitals in California as it realigns its focus outside of the state.

The system operates seven hospitals in California, four in Pennsylvania, three in Connecticut and two in Rhode Island. Prospect is also the parent company of Bloomfield, N.J.-based CHA Partners and Upland, Pa.-based Crozer Health, which own and operate ASCs under Prospect.

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