Silke Mayr CareMax, a prominent healthcare provider operating 56 medical centers across Florida, Texas, Tennessee, and New York, has filed for Chapter 11 bankruptcy protection in Texas. The company primarily caters to elderly patients and is now grappling with significant financial difficulties.
According to its filing with the U.S. Bankruptcy Court for the Northern District of Texas, CareMax has accumulated debts of over $690 million, with assets totaling $390 million. In August, the company revealed a loss of more than $170 million for the second quarter and issued a warning about its ability to continue as a going concern.
The company also disclosed that it would not be able to submit its third-quarter report to the U.S. Securities and Exchange Commission due to a lack of funds, Reuters reported.
What Happens to CareMax Going Forward?
In the bankruptcy filing, CareMax indicated that it is seeking to sell both its management services and core assets related to its medical centers. The company also intends to maintain normal operations at its clinics and continue paying wages to its healthcare staff, including doctors and nurses.
CareMax has engaged Alvarez & Marsal as its financial advisers and Piper Sandler as its investment banker to help guide the restructuring process.
Other Healthcare Providers in Financial Distress
CareMax is not alone in its financial struggles. Earlier this year, Steward Health Care, based in Massachusetts, filed for bankruptcy with $9 billion in debt and plans to sell off its 31 hospitals. CEO Ralph de la Torre has faced criticism for receiving over $100 million in compensation while employees reported shortages of essential supplies. In response, the Senate Committee on Health, Education, Labor, and Pensions launched an investigation, and in September, they approved a resolution for civil enforcement and criminal contempt charges against de la Torre after he defied a subpoena.