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Many hospitals in the United States use aggressive tactics to collect medical debt. But a wealthy nonprofit health system in the Midwest is among those taking things a step further: withholding care from patients who have unpaid medical bills, the New York Times reported. Allina Health System, which runs more than 100 hospitals and clinics in Minnesota and Wisconsin and brings in $4 billion a year in revenue, sometimes rejects patients who are deep in debt, according to internal documents and interviews with doctors, nurses and patients. Although Allina’s hospitals will treat anyone in emergency rooms, other services can be cut off for indebted patients, including children and those with chronic illnesses like diabetes and depression. Patients aren’t allowed back until they pay off their debt entirely. Nonprofit hospitals like Allina get enormous tax breaks in exchange for providing care for the poorest people in their communities. But a New York Times investigation last year found that over the past several decades, nonprofits have fallen short of their charitable missions, with few consequences. Allina has an explicit policy for cutting off patients who owe money for services they received at the health system’s 90 clinics. A 12-page document reviewed by the Times instructs Allina’s staff on how to cancel appointments for patients with at least $4,500 of unpaid debt. The policy walks through how to lock their electronic health records so that staff cannot schedule future appointments.

The cancer-treatment specialist GenesisCare has filed for bankruptcy protection, after struggling under a debt load enlarged by a $1.5 billion takeover, the Wall Street Journal reported. Australia-based GenesisCare said today that it would split its U.S. business from operations in Australia, Spain and the U.K. as part of the U.S. chapter 11 reorganization. GenesisCare didn't say how much debt would be affected by the filing. GenesisCare is backed by the U.S. private-equity giant KKR. Starting with a single clinic in 2005, it has grown to more than 300 locations in four countries and over 5,500 employees. “The past three years have presented significant operational and financial challenges, requiring a comprehensive restructuring of the operations and balance sheet of the company,” David Young, who started as GenesisCare’s chief executive in April, said in a statement. GenesisCare has secured $200 million of debtor-in-possession financing from existing lenders, and plans to continue operating without disruption to patient care.

Allied Healthcare Products, a respiratory medical-devices maker, spent hundreds of thousands of dollars in 2020 expanding its product line to meet what it believed would be a surge in demand for ventilators at the onset of the pandemic. By the time it churned out more machines, demand fell short of expectations. Earlier this month, the company filed for bankruptcy and plans to sell its assets, WSJ Pro Bankruptcy reported. “Having diverted a lot of resources — time, personnel, floor and machine space — to ventilator production, Allied found it had an inventory of ventilators it couldn’t sell,” Eric Peterson, the St. Louis, Mo.-based company’s lawyer, said at a hearing earlier this month. Other healthcare suppliers, including a vial manufacturer and a COVID-19 test-kit maker, are among companies that have filed for chapter 11 bankruptcy. Many such companies are rattled by diminishing sales as pandemic worries recede, and they are now burdened with products piling up in storage. “More than anything I’ve ever seen, COVID chose winners and losers during the lockdown, and it is determining winners and losers now,” said Ken Mann, managing director for investment bank SC&H Capital. Vial manufacturer SiO2 Medical Products, which sought protection from creditors in March, ramped up capacity to make 120 million vials a year during the pandemic. By the time the facility was ready, demand for COVID-19 vaccines had tapered. And vaccine distribution ended up favoring syringes over vials.

Anaergia Inc. has announced that one of its subsidiaries, Rialto Bioenergy Facility LLC (RBF), has initiated voluntary chapter 11 bankruptcy proceedings in the U.S. Bankruptcy Court for the Southern District of California, Recycling Today reported. RBF anticipates that, during the restructuring, it will continue operating its multi-feedstock bioenergy facility in Rialto, Calif., which can convert up to 700 tons per day of organic waste, such as food and yard waste and biosolids, into renewable natural gas (RNG) with the capability to generate renewable electricity, soil amendments and fertilizer. RBF, with offices in Carlsbad and a facility in Rialto, California, is 51-percent owned by Anaergia Services LLC, a wholly-owned Anaergia subsidiary. As a result of a lack of feedstock available to the facility, RBF has been unable to produce sufficient revenue to cover its costs and debt service. Anaergia says the feedstock shortfall is due to a delay in the implementation and enforcement of laws requiring organic waste diversion from landfills by the city of Los Angeles as required under its contracts with private waste management companies, as well under California’s SB 1383. The company says feedstock ramp-up is slow industry-wide.

GenesisCare, a provider of cancer-care services backed by KKR, is preparing to file for bankruptcy within days, WSJ Pro Bankruptcy reported. The Australia-based company, which also operates in the U.S. and Europe, is in talks to receive roughly $200 million in new financing to see it through bankruptcy. GenesisCare is advised by lawyers from Kirkland & Ellis. China Resources Group is also an owner of the company. GenesisCare has been struggling under a debt load in part stemming from its $1.5 billion acquisition of 21st Century Oncology in 2020. Healthcare service provider 21st Century Oncology filed for bankruptcy in 2017, blaming changes in insurance reimbursement practices in addition to government penalties and settlements. It emerged from chapter 11 in 2019. Since October, S&P Global has cut GenesisCare’s credit ratings twice, each time pushing it one notch deeper into distressed territory, raising expectations that the company would default.

Hollister, Calif.-based Hazel Hawkins Memorial Hospital will decide whether or not it will file a chapter 9 bankruptcy case at the San Benito Health Care District board meeting on May 22, local news outlet KSBW reported May 16, according to Becker's Hospital CFO Report. A November fiscal emergency declaration authorized a chapter 9 filing but the hospital district decided to focus on short-term financial stabilization and creditor negotiations, according to the report. In the last six months, it has recorded more than $11 million in cost savings, loans and prepayments to support the district through summer. In this instance, the hospital district would be able to continue operations without disruption, including caring for patients, operating its facilities, and making payroll, according to the report. The hospital district is continuing cost-saving efforts ahead of a potential strategic partnership with a larger entity.