Gulf Coast Medical Center in Rural Texas Files for Chapter 7 Bankruptcy

by San Antonio Attorney

Gulf Coast Medical Center, the only hospital in Wharton, Texas, filed for Chapter 7 bankruptcy soon after it shuttered in November.

 

The hospital downsized its services last year and operated as a walk-in emergency facility when it completely shut down on Nov.  18.  After three days, it filed for Chapter 7 bankruptcy in a Texas bankruptcy court.

 

The bankruptcy petition filed by the hospital shows that it owes creditors between $10 million and $50 million, and its assets are valued between $1 million and $10 million.  It declared about 200 creditors in its filing.

 

For the past six years, around 80 rural hospitals have already shuttered.  Texas has the highest number of any state with 13 rural hospitals that closed, according to reports.

 

The National Rural Health Association said there are about 283 rural hospitals in the United States that are at risk of going bankrupt—at least 10% of all those hospitals.  The nonprofit organization found that the financial states of the hospitals barely hanging on are the same to hospitals that already have shuttered.  At least a third of rural hospitals suffered losses in 2013, the association said.

 

But some experts point out that there are rural facilities failing to provide high-quality service and that it would be better for rural communities to coordinate with bigger regional hospitals and that apply innovative approaches to patient care.

 

Nevertheless, a new study established that rural hospitals are usually better at preventing the spread of hospital-acquired diseases.

 

To be eligible to file a Chapter 7 case, a debtor must pass the means test instituted with the 2005 amendments to the bankruptcy code.  Find out whether you are qualified to discharge you debt through Chapter 7 bankruptcy by consulting a Bankruptcy Attorney San Antonio.

 

Leave a Comment

Previous post:

Next post: