As many doctors struggle to keep their practices financially sound, some are buckling under money woes and being pushed into bankruptcy.
It’s a trend that’s accelerated in recent years, industry experts say, with potentially serious consequences for doctors and patients. Some physicians are still able to keep practicing after bankruptcy, but for others, it’s a career-ending event. And when a practice shuts its doors, patients can find it harder to get the health care they need nearby.
Chapter 11 bankruptcy filings by physician practices have spiked recently, noted Bobby Guy, co-chair of the American Bankruptcy Institute’s health care committee, who tracks bankruptcy trends tied to distressed businesses. Guy said there were at least eight filings in recent weeks, which he said was “very unusual.”
Five years ago, Plantation, Fla.-based bankruptcy attorney David Langley didn’t have a single doctor as a client. Since then he’s handled at least six bankruptcy cases involving doctors. Two current clients — an orthopedic surgeon and an OB/GYN — also are in bankruptcy.
None of his physician clients had malpractice lawsuits that landed them in dire financial straits. All are “top-notch doctors,” he said.
The weak economy has taken a toll on doctors’ revenue, as consumers cut back on office visits and lucrative elective procedures, said Guy, a bankruptcy attorney in Nashville with Frost Brown Todd LLC.
Doctors also blame shrinking insurance reimbursements, changing regulations, and the rising costs of malpractice insurance, drugs and other business necessities for making it harder to keep their practices afloat.
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