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It is well established that health care businesses are confronted with significant financial challenges, including lower reimbursement rates, constant changes in the delivery of services, increased competition and the need for expensive capital improvements to adopt the latest technology. Recent political uncertainty and heightened government scrutiny has only exacerbated these challenges.

According to the National Rural Health Association (NRHA),[1] since 2010, more than 100 rural hospitals have closed.[2] This trend does not appear to be slowing. One recent study by Navigant Consulting, Inc.

Rural hospitals in America are closing at a rapid pace, and many others are experiencing severe challenges. The statistics reflecting the closings and financial challenges facing rural hospitals are readily available, but that is not the focus of this article. Rather, the focus is on identifying common problems facing rural hospitals from the viewpoint of debtor’s counsel and other restructuring professionals for hospitals that are debtors in possession or candidates for restructuring.

Declining Patient Volume

Bankruptcy court jurisdiction over Medicare issues is increasingly important given the distressed state of the health care industry and skyrocketing level of bankruptcy filings by health care providers. On May 10, 2019, in Benjamin v.

The economic challenges in today’s current health care climate are well documented and run to the core of a fundamental national debate rearing its head in the upcoming 2020 election cycle. “Medicare for All” is more than a sound bite or political posture; the larger issue is whether U.S. citizens believe that access to affordable health care for all is a right in this country. That issue won’t be addressed here but in legislative bodies across the nation. While the debate rages, those who can afford access to the best will travel to and pay for the best care.