Bradenton, Fla.-based MCR Health, a nonprofit medical group, sought Chapter 11 protection Nov. 11, the Tampa Bay Business Journal reported Nov. 13.
"In order to continue to allow MCR Health to remain a leader in providing healthcare and access for all, we have made some difficult decisions to align with our financial reality," a spokesperson for MCR Health said in a Nov. 13 statement shared with Becker's. "These operational decisions, including workforce reductions, will be rolled out in phases."
Court documents filed in Florida revealed MCR has around $14.4 million in debt, consisting of around $12 million in loans and $2.4 million to unsecured creditors, the publication reported.
Factors like damage and disruption following hurricanes Helene and Milton were cited in the filing, including change to reimbursement rates for behavioral health services, which almost cut MCR's revenue in half without notice. MCR attorney Steven Berman said the group's leadership is gaining ground on reversing the rate change.
MCR's expense reduction strategy comprises assessment of medical practice areas to locate potential revenue enhancement and cost saving opportunities, like modifying service offerings to better align with operating expenses.
The group pays above-market rent for a portion of its 24 leased locations. While some of the leases may be renegotiated or rejected, details on which locations could be affected are not available yet, the Journal reported.