Quincy, Mass.-based Compass Medical Group has filed for Chapter 7 bankruptcy less than one week after it abruptly closed and discontinued services to about 70,000 patients, according to The Patriot Ledger.
The bankruptcy filing comes after a class-action suit was filed June 2 against Compass, which includes more than 70 providers and six clinic locations, according to its website. The bankruptcy filing claims that Compass will have no money to pay unsecured creditors after administrative expenses are paid.
"It's certainly a disappointing legal tactic that they're taking," Jonathan Sweet, an attorney representing the plaintiff, told The Patriot Ledger. "It's going to delay things. It's disappointing, but not shocking, that they're hiding behind bankruptcy laws to avoid responsibility for the harm they've caused."
Compass was previously affiliated with Steward Medical Group — part of Boston-based Steward Health Care — but the partnership ended in lawsuits filed over financial issues in 2022. Compass was found guilty of fraud and Steward was awarded $16.4 million, which remains unpaid and has grown to $25 million in the interim, according to Steward's attorney.
"It is with our deepest regret and great sadness to inform you of our imminent plan to close our practices. After a steady stream of challenges, we were ultimately forced to make the devastating decision to close all offices of Compass Medical, effective immediately. There is no good way to share this news. We are heartbroken and truly sorry as we know the unprecedented impact on our valued patients," Compass said in a statement on its website.
Compass did not respond to Becker's request for comment.