NES Health, a physician-led staffing firm, is reportedly planning to cease operations amid financial difficulties that left emergency department physicians at numerous hospitals without pay.
"As you are aware, in recent months, NES America has experienced financial difficulties," the company said in a Nov. 22 email to physicians that is circulating on Reddit. "NES does not have any funding or available cash. Consequently, NES will not be able to provide malpractice tail coverage."
"NES has made the difficult decision to wind down its operations and cease doing business. We deeply regret this situation."
Earlier this month, the staffing company's CEO and chief medical officer resigned, according to a Nov. 26 report from MedPage Today. However, NES has not filed for bankruptcy. The company was founded by Allan Rappaport, MD, a California-based radiation oncologist.
The fallout follows several weeks of reports regarding the financial challenges at NES that led to physician pay issues at around 30 hospitals nationwide that contract with the company. At Daly City, Calif.-based Seton Medical Center, ED physicians had not received pay for more than two months, a hospital spokesperson told Becker's Nov. 14.
"We're dismayed by NES' actions and are taking legal measures because NES left Seton in a lurch and because Seton paid funds to NES intended for its emergency physicians, but NES failed to pay them," Sarkis Vartanian, an administrator at Seton, said in a statement to MedPage Today.
Payroll issues at NES also led Amarillo, Texas-based Northwest Texas Healthcare System to temporarily close two freestanding EDs, which remained closed as of Nov. 23. The health system has since selected a new contractor and is working to resume normal operations at the EDs in the coming days, the hospital's CEO said in a Nov. 23 memo sent to Becker's.
Becker's has reached out to NES Health and will update the story should more information become available. The company has not responded to previous requests for comment.