CarePoint Health Systems Inc., a nonprofit operating three hospitals in New Jersey, has filed for Chapter 11 bankruptcy in Delaware. Facing mounting costs since the COVID-19 pandemic, CarePoint aims to use the bankruptcy process to restructure its debt and secure a stable financial future for its facilities.
Post-COVID Cost Pressures and Funding Challenges
In its Chapter 11 filing, CarePoint cited increased operational costs, ongoing state funding issues, and reimbursement challenges as key factors that led to its decision. The nonprofit health system, which operates Bayonne Medical Center, Christ Hospital in Jersey City, and Hoboken University Medical Center, said it has secured $67 million in debtor-in-possession financing to ensure its hospitals remain open and operational throughout the bankruptcy process.
“We chose this path after we thoroughly evaluated all available options that would ensure the continued delivery of uninterrupted care while enabling this necessary financial restructuring,” said Dr. Achintya Moulick, CEO of CarePoint Health. The decision drew support from local officials, including Jersey City Mayor Steven Fulop, who emphasized the importance of stabilizing these community hospitals for Hudson County.
CarePoint files for Chapter 11 : Financial Backing for Ongoing Operations
CarePoint’s debtor-in-possession financing will provide critical funds to cover operational expenses during the restructuring. By taking this step, the health system aims to improve its financial position, ultimately putting its hospitals on a more sustainable path. The $67 million financing arrangement is expected to ensure uninterrupted care and stability for the hospitals’ patients and staff.
CarePoint files for Chapter 11 : Legal and Financial Representation
CarePoint has engaged Dilworth Paxson LLP as its legal counsel and Ankura Consulting as its financial adviser for the Chapter 11 proceedings. The case has been assigned to U.S. Bankruptcy Judge J. Kate Stickles in the Delaware Bankruptcy Court.
