Forest Park Medical Center in Texas filed for chapter 11 protection on Tuesday, the Dallas Morning News reported today. According to court documents, the hospital was based on an out-of-network model that relied on higher reimbursement rates for its operations. But that model has not generated enough revenue to sustain operations, documents say. So the center shifted and began contracting with insurance providers for in-network procedures, but those reduced rates haven’t been enough to increase the medical center’s overall revenues, documents state. Without more patients, the hospital owes more than $14 million to creditors and cannot generate enough revenue to operate and service its debt, according to the documents. Read more.
For more on medical center bankruptcies, be sure to pick up a copy of ABI’s Health Care Insolvency Manual, Third Edition.
