A change in Medicare reimbursements negatively impacted the company’s earnings.
A major health care provider in Florida has filed for bankruptcy in pursuit of a sale after revenues declined and ongoing liquidity challenges.
MBMG Holding LLC and multiple health care firms operating under it, collectively referred to as the Clinical Care Medical Centers, filed voluntary petitions for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Southern District of Florida on Sunday, according to an Oct. 13 bankruptcy petition. The entities plan to use the bankruptcy to sell “substantially all of their assets” to Conviva Medical Center Management.
The petition comes after the medical centers faced “hurdles resulting from industry and regulatory headwinds,” said a filing by the Chief Restructuring Officer Nicholas K. Campbell. These hurdles, together with highly leveraged balance sheets, “significantly challenged” the businesses and depleted liquidity.
Collectively, the entities operate 26 primary care centers in Florida, serving roughly 35,000 patients, and employing more than 800 workers.
According to the filing, the “most significant headwind” was related to the Medicare risk-adjustment model implemented by the Centers for Medicare & Medicaid Services (CMS), a federal agency within the U.S. Department of Health and Human Services.
The firms earn revenue through their contracts