Carbon Health Technologies Inc., a California-based urgent care provider that once rode the telehealth surge of the pandemic era, has sought shelter in Chapter 11 bankruptcy protection in Texas, listing more than $100 million in liabilities.

The filing, made Monday, marks a pivotal moment for the health technology company, which operates more than 100 locations nationwide and provides both in-person and virtual care.

Restructuring Plan Backed by Lenders

In a news release, Carbon Health said it has struck a comprehensive restructuring agreement with its lenders. The company intends to pursue a dual-track strategy: a debt-for-equity swap alongside a Chapter 11 sale process.

Chief Executive Officer Kerem Ozkay described the move as deliberate and necessary.

“The decisive actions we are taking today will strengthen our financial foundation and better position Carbon Health to advance our mission of making high-quality healthcare accessible to everyone,” Ozkay said. He added that the company has received strong backing from its lenders, which he said will allow the case to proceed efficiently and with minimal disruption to patients, partners and employees.

The company has secured up to $19.5 million in debtor-in-possession financing from Future Solutions Investments to fund operations during the bankruptcy proceedings.

Pandemic Aftershocks and Market Pressures

Carbon Health said it began to feel mounting financial strain after the COVID-19 pandemic, as demand patterns shifted and capital markets for healthcare companies tightened.

The same forces that once propelled rapid growth — surging telehealth visits and investor enthusiasm — later receded, leaving the company navigating a more unforgiving landscape.

Over the past year, Ozkay said, the company has narrowed its operational footprint, streamlined its structure and reinforced financial discipline.

“By using the Chapter 11 process to implement a transaction that will right-size our capital structure, we expect to emerge as a more resilient organization with the flexibility needed to support sustainable growth and continue delivering best-in-class care,” he said.

Operations to Continue Without Disruption

Despite the bankruptcy filing, Carbon Health emphasized that day-to-day operations will continue uninterrupted.

“It will be business as usual while we complete the restructuring and sale,” Ozkay said. “Patients should experience no disruption to their care.”

The company said it will continue offering urgent and primary care services at its clinics and through virtual appointments when appropriate. Patients will maintain full access to their medical records, and their health information will remain secure, according to the release.

Founded in 2015, Carbon Health positions itself as a health technology company integrating digital tools with traditional clinical services.

Advisors and Court Assignment

To navigate the restructuring, Carbon Health has retained Alvarez & Marsal as financial advisor and Pachulski Stang Ziehl & Jones LLP as bankruptcy counsel.

The case has been assigned to U.S. Bankruptcy Judge Christopher M. Lopez.

Carbon Health Technologies Inc. is represented in the proceedings by Maxim Boris Litvak of Pachulski Stang Ziehl & Jones LLP.

As Carbon Health filed for Chapter 11, the company’s next chapter will unfold in bankruptcy court — a high-stakes effort to stabilize its finances while continuing to serve patients across the United States.