In 2025, Becker’s reported at least 20 hospitals, health systems and healthcare organizations seeking or exiting bankruptcy protection.
The trend follows a notable warning sign for physicians — physician practice bankruptcy filings hit a six-year high in 2024, according to a Chapter 11 filings report from healthcare restructuring advisory firm Gibbins Advisors.
Here are 10 bankruptcies physicians and ASC leaders should have on their radar:
Alfred Bonati, MD, founder of Hudson, Fla.-based Bonati Spine Institute, filed for Chapter 11 protection. Proceedings were also initiated for Gulf Coast Orthopedic Center (the practice’s business arm) and its affiliate, All American Holdings, according to the report. The combined firms reported liabilities of at least $101 million.
The filing comes two years after the practice’s spine ASC was temporarily shut down by the state amid allegations that a “certified surgical technologist” was performing surgeries without a medical license. Dr. Bonati sued the state’s health agency for defamation; the lawsuit was dismissed.
A U.S. Bankruptcy Court judge approved Secaucus, N.J.-based Hudson Regional Hospital to take over operational control of three Jersey City, N.J.-based CarePoint Health hospitals, allowing the system to exit bankruptcy. Hudson Regional now owns and operates Bayonne (N.J.) Medical Center and operates Jersey City-based Christ Hospital and Hoboken (N.J.) University Medical Center under the approved management agreement. Each hospital is now operated by an affiliated property owner.
CarePoint sought Chapter 11 protection Nov. 3 and received bankruptcy court approval in January to affiliate with Hudson Regional under management services organization Hudson Health System through a restructuring plan.
Kennett Square, Pa.-based Genesis HealthCare filed for Chapter 11 protection July 9 in a Texas federal court to restructure its finances and address what it called “legacy liabilities associated with previously divested operations.” Genesis operates about 175 nursing facilities in 18 states and employs more than 27,000 workers. The company said staff will retain their positions, pay and benefits during the process, and vendor agreements will remain in place.
The filing includes a stalking horse bid from current Genesis affiliate ReGen Healthcare, Bloomberg reported. Genesis said the proposed deal is subject to higher bidding and court approval and would result in ReGen acquiring the company’s operations. Genesis reported roughly $708.5 million in secured liabilities and more than $1.5 billion in unsecured debt. Genesis also said it secured a $30 million debtor-in-possession financing commitment from existing secured lenders.
Bradenton, Fla.-based MCR Health, a nonprofit medical group, exited Chapter 11 bankruptcy after seeking protection in mid-November. MCR previously held about $14.4 million in debt, including approximately $12 million in loans and $2.4 million to unsecured creditors. The group also cited damage and disruption after hurricanes Helene and Milton, along with behavioral health reimbursement rate changes.
“Over the past several months, MCR Health has faced financial challenges head-on, and through the collective resilience and dedication of its staff, has emerged more focused, stable and committed than ever to its mission,” said a June 6 MCR Health news release shared with Becker’s.
Michigan Institute of Forensic Science & Medicine
David Stockman, MD, filed for Chapter 11 protection on behalf of the Michigan Institute of Forensic Science & Medicine, which he owns. The filing delays entry of a $551,800 arbitration award to Russell Bush, MD, after Dr. Stockman was found to have defamed and intentionally harmed Dr. Bush.
MIFSM’s 10-year contract with Saginaw County was terminated after Dr. Stockman fired Dr. Bush without county authorization and allegedly performed autopsies without certification. Dr. Stockman did not file individually, leaving him personally liable, and he is seeking to extend MIFSM’s automatic stay to cover himself.
Court records also show multiple default judgments and additional physician wage claims against Dr. Stockman and entities he owns. The bankruptcy filing itself may be at risk because Dr. Stockman filed it pro se on behalf of the corporation; a judge ordered him to appear and justify the filing, and his attorney has withdrawn.
Physician staffing firm NES Health filed for Chapter 7 bankruptcy Feb. 21. NES announced plans to cease operations in November, citing financial challenges. Reports indicate the company’s struggles left emergency department physicians at multiple hospitals unpaid for a period of time.
NES filed in the U.S. Bankruptcy Court for the Southern District of Illinois with estimated assets between $1 million and $10 million and liabilities ranging from $10 million to $50 million. Founded by Allan Rappaport, MD, the company listed hundreds of creditors, including hospitals and contract physicians. The filing includes more than 35 affiliated entities across multiple states, with debtors requesting joint administration under the lead case of NES America.
Los Angeles-based Prospect Medical Holdings, a private equity-backed system, filed for Chapter 11 protection in January. Prospect initiated voluntary Chapter 11 proceedings as it works to sell 10 of its 16 hospitals, according to a Jan. 11 news release. The system said facilities will remain open and patient care will be uninterrupted during the Chapter 11 process. Prospect also said it will prioritize operating community hospitals in California as it realigns its focus outside the state.
Prospect 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.
Rite Aid filed for Chapter 11 bankruptcy in May for the second time in under two years, saying it planned to sell “substantially all” of its assets. CEO Matt Schroeder cited intensifying financial difficulties and rapid shifts in the retail and healthcare environments.
Rite Aid previously filed in October 2023 and emerged in September 2024 after a major restructuring and debt reduction, but continued to face systemic challenges affecting retail pharmacy chains. Pharmacy closures are rising across the U.S., reversing a decades-long expansion trend, and mergers between large chains and pharmacy benefit managers have consolidated patient flows into select networks.
Elmira, N.Y.-based Southern Tier Orthodontics abruptly closed in January. The practice told patients via text message that it was declaring bankruptcy and closing due to personal and financial reasons. Jason Horn, DDS, the orthodontist and owner, told patients he would not be able to provide care but would transfer records to new orthodontists. He also said he would not be able to reimburse patients, including those who paid in full or in advance.
Fort Walton Beach, Fla.-based White-Wilson Medical Center, a multispecialty physician group, voluntarily sought Chapter 11 protection to restructure debt without interrupting operations. Court filings also include motions to honor employee benefits, maintain patient services and continue paying wages.
“White-Wilson intends to propose a Chapter 11 Plan of Reorganization that will provide for distributions to creditors and enable the practice to emerge from bankruptcy as a stronger organization,” an Oct. 6 news release said.
