CareMax filed for Chapter 11 bankruptcy protection Nov. 17, triggering a restructuring of the business, including divestment of major assets such as its MSO and clinic operations, according to an April 1 blog post from VMG Health.
Here are nine things to know about the bankruptcy:
1. To streamline operations and address debt, CareMax sold its MSO business to Revere Medical (formerly Rural Health Group) and its operating clinics to ClareMedica Viking for a combination of $35 million cash and $65 million in ClareMedica Health Partners units.
2. The 2022 acquisition of Dallas-based Steward Health Care’s Medicare value-based care business made CareMax the exclusive MSO for 171,000 older adult patients. But when Steward filed for bankruptcy in May 2024, this contributed to CareMax’s financial collapse and forced a reevaluation of the sale, the post said.
3. CareMax reported net operating losses of $40 million in 2022 and $683 million in 2023. This was driven by pandemic-related challenges, a constrained capital market, inflation, CMS’ V28 model and uncertainty surrounding the Steward relationship, according to VMG Health.
4. As part of the Chapter 11 reorganization, all existing equity was wiped out. Shareholders received no distributions.
5. Founded in 2011, CareMax focused on providing care to underserved populations and quickly grew its presence, particularly in Florida. The 2021 merger brought in $614 million, funding aggressive expansion, including a deal with Anthem to open 50 new centers.
6. CareMax’s tech arm, CareOptimize, aimed to simplify value-based care transitions via analytics and AI. It was integral to their promise of improving outcomes while reducing cost.
7. In addition to Revere acquiring CareMax’s MSO, it previously acquired Steward’s physician network.
8. By acquiring CareMax’s operating clinics, ClareMedica Viking expanded its footprint in multispecialty care, potentially influencing physician employment, referral patterns and value-based alignment in affected markets, according to the post.
9. After divesting most of its assets, CareMax has not announced plans to rebuild. It will deregister its securities, effectively ending its status as a public company.
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