Gilbert (Ariz.) Hospital and Florence (Ariz.) Hospital entered chapter 11 bankruptcy in late May after creditors sought to force the hospitals into bankruptcy in an attempt to collect $1.96 million they claim the affiliated hospitals owe, according to Becker's Hospital CFO Report. In late April, three employees jointly filed the involuntary bankruptcy petition for Florence Hospital, seeking $46,650 in wages. Gilbert Hospital's involuntary bankruptcy petition, which seeks more than $1.9 million, was filed by the hospital's founder and CMO Timothy Johns, MD, an unsecured creditors' trust and a Phoenix-based law firm. After creditors ask the court to initiate bankruptcy proceedings, the debtor has the opportunity to contest the petition. The two Arizona hospitals failed to contest the petition within the required 21-day timeline, and the court subsequently granted creditors' request for relief through the chapter 11 bankruptcy process. Read more.
For more on hospital and health care insolvencies, be sure to pick up a copy of the ABI Health Care Insolvency Manual, Third Edition from the ABI Bookstore.
