A health system that runs 23 hospitals in 13 states has moved to restructure its debt, a move that will likely lead to its filing for Chapter 11 protection.
Quorum Health, which is headquartered in Brentwood, Tenn., announced the step April 7, saying its aim is to cut its debt by about $500 million. To accomplish this, the corporation has entered into a restructuring support agreement with its lenders, and it’s about to file for bankruptcy.
In a note addressed to all Quorum stakeholders, Bob Fish, the president and CEO, says the action is intended to protect employees and safeguard patient care as the coronavirus crisis hits the global economy as well as the U.S. healthcare system.
“Our company has been transparent about the need to reduce the large amount of debt and the associated high interest rate inherited when Quorum Health was formed in 2016,” he states. “By working with key investors in advance, we have been able to utilize the rules under Chapter 11 of the U.S. Bankruptcy Code to recapitalize the company.”
Fish adds that the operations of Quorum Health and its hospitals will remain unaffected while the restructuring is ongoing.
Click here for Fish’s note and here for the company’s full announcement to the press.
Dave P. has worked in journalism, marketing and public relations for more than 30 years, frequently concentrating on hospitals, healthcare technology and Catholic communications. He has also specialized in fundraising communications, ghostwriting for CEOs of local, national and global charities, nonprofits and foundations.