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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. 

Health Diagnostic Laboratory Inc. will become the property of a startup Texas-based diagnostics company, if the results of an auction held on Thursday receive bankruptcy court approval this week, the Richmond Times-Dispatch reported on Saturday. Richmond-based HDL said on Friday that True Health Diagnostics LLC was the successful bidder in a bankruptcy court supervised auction of HDL’s assets. Frisco, Texas-based True Health, which started operations about a year ago, agreed to pay $37.1 million to acquire substantially all of the business assets of HDL — $5.1 million more than its initial bid. HDL, a blood-testing company with hundreds of employees and its main office and laboratory in downtown Richmond, has been operating under chapter 11 bankruptcy protection since June 7 and had offered itself for sale to help pay off debts.

Cambridge Endoscopic Devices, a Framingham, Mass., medical device manufacturer, has filed for bankruptcy after its sales declined and it couldn’t find a buyer, the Boston Globe reported on Saturday. The company listed assets of $3 million and liabilities of $17 million in filings in federal bankruptcy court. According to court filings, its advanced endoscopes and laparoscopes, which are used to make surgery less invasive, became too expensive for many hospitals to buy after the passage of the Affordable Care Act. More than 40 potential buyers contacted over the past two years but didn’t make a “viable offer” for the company, it said in a filing. It listed $355,000 in income in 2013, $328,000 last year, and $70,000 so far this year. The vast majority of its assets were intellectual property, including patents filed for surgical instruments.

Univita of Florida, a health company in Miramar, Fla., has filed for bankruptcy after closing abruptly and laying off hundreds of employees a month ago, the Sun Sentinel reported today. The home care product provider is seeking to liquidate its remaining assets under chapter 7. The company ceased operations with between 10,000 and 25,000 creditors, according to a checklist that accompanied more than 1,135 pages of court documents filed in Delaware. The company, which had Medicaid and Medicare contracts in Florida, estimated both its assets and liabilities were worth between $50 million to $100 million. Eleven Univita subsidiaries also filed for chapter 7 bankruptcy on Friday. Read more. 

For more on healthcare bankruptcies, be sure to pick up a copy of ABI’s Health Care Insolvency Manual, Third Edition. 

Bankruptcy Judge Kevin R. Huennekens yesterday gave final approval to Health Diagnostic Laboratory Inc.’s debtor-in-possession financing deal, the Richmond (Va.) Times-Dispatch reported today. The financing arrangement with CVF Beadsea LLC, an affiliate of the Greenwich, Conn.-based investment firm Credit Value Partners, gives Richmond-based HDL access to a revolving loan of up $12 million, which the company can use to support its business operations while it tries to sell itself under chapter 11 protection. The ruling by Judge Huennekens enables HDL, a blood-testing company with a laboratory and office in downtown Richmond, to access the full loan amount despite objections raised by the company’s primary lender, BB&T Bank. BB&T has questioned the terms of the financing deal, which the bank argues inappropriately put its claims on HDL’s assets in a subordinate position to the new lender. Late Friday, the U.S. District Court in Richmond denied an appeal by BB&T that sought to overturn Judge Huennekens’ preliminary approval of the financing arrangements on Aug. 4.

A bankruptcy judge approved the pending sale of Parkview Adventist Medical Center to its nearby rival, Mid Coast Hospital, the Portland (Maine) Press Herald reported on Saturday. Bankruptcy Judge Peter Cary signed the order on Thursday allowing the merger of the two Brunswick hospitals to proceed as part of a bankruptcy action filed in June by Parkview. The order stipulates that approval of the sale is in the best interests of the Parkview, the bankruptcy estate and its creditors. The terms of the agreement calls for Mid Coast to pay Parkview $3.8 million at the closing, to forgive $579,540 of an advance it gave to Parkview during the bankruptcy proceeding and to commit $1 million each year for three consecutive into the Parkview campus. All 190 Parkview employees are expected to be rehired by Mid Coast.

The U.S. Trustee for Georgia's Region 21 is asking that the bankruptcy filed by Hutcheson Medical Center be dismissed, saying that the condition of the Fort Oglethorpe medical facility is too far gone to be salvaged, The Chattanoogan reported today. U.S. Trustee Guy G. Gebhardt said that HMC has picked up over $5 million in new debts since filing for bankruptcy. He said patient care is at risk at the facility, and asked for an expedited hearing and that the case be dismissed. Farrell Hayes, president and CEO of Hutcheson Medical Center, said, “Hutcheson’s medical staff and the patients themselves will be the first to tell you that our patient care fully meets the needs of this region and places the safety and comfort of our patients front and center.

A bankruptcy court has denied both motions filed by El Paso Children's Hospital and UMC Health System, KFOX14.com reported yesterday. Children's Hospital pushed for a time extension to come up with a recovery plan, while UMC wanted to end the time Children's has now and move forward with its recovery plan. Children's has until Sept. 15 to come up with a plan and 60 days after filing to have it confirmed by both parties.

Executives with the struggling St. Michael's Medical Center in Newark, N.J., filed for bankruptcy protection on Monday, with officials blaming uncertainties surrounding the state's long review of the proposed sale of the facility, NJ.com reported yesterday. "We've done everything the state has asked us to do," said David Ricci, the hospital's CEO. "After two and a half years, it would appear we're no further along than when we started." The bankruptcy move was done so the hospital will continue to have enough money on hand until the expected sale to Prime Healthcare Services, a for-profit company out of California. Employees and patients should not notice any change, Ricci said. "The state remains committed to the health and well-being of Newark residents," said Donna Leusner, spokeswoman for the N.J.Department of Health. "The department has taken a reasonable and deliberative approach as it always does with certificate of need applications. Having completed multiple rounds of questions, it remains under review." She declined to provide any timetable for when that review would be concluded. Read more. 

For more on the bankruptcy proceedings related to hospital facilities, be sure to pick up a copy of ABI’s Health Care Insolvency Manual, Third Edition. 

A bankruptcy court judge on Tuesday gave preliminary approval to a financing plan that will help support Health Diagnostic Laboratory Inc.’s (HDL) business operations while the company tries to sell itself, the Richmond Times Dispatch reported yesterday. The Richmond-based blood-testing company obtained debtor-in-possession financing from CVF Beadsea LLC, an affiliate of the Greenwich, Conn.-based investment firm Credit Value Partners. The agreement will give HDL access to $6 million from a revolving credit facility on an interim basis, and $12 million if the financing is approved after a final hearing scheduled for Aug. 24. Bankruptcy Judge Kevin Huennekens approved the financing deal on an interim basis at an expedited hearing, but only after an exchange of arguments among the lawyers that exposed the tensions between HDL and its primary lender, BB&T Bank.