Bankrupt Dallas Promise Hospital Goes to Auction

: Chris Lee Law Firm

  Filed under: News

Promise HospitalHospital Chapter 11 bankruptcy cases have increased dramatically over the past 18 months, and even northwest Dallas hasn’t been able to escape the repercussions of healthcare debt problems. The Promise Healthcare Group, which filed for Chapter 11 bankruptcy reorganization in November 2018 has announced that the Dallas Promise Hospital will now proceed to the auction block as the company looks to reorganize its crushing debt.

Promise Healthcare Group’s Chapter 11 Bankruptcy

When Promise Healthcare Group, which operates 14-16 hospitals including one in northwest Dallas, filed bankruptcy in November of 2018 it reported debts more than $780 million. These debts included accrued and unpaid interest, accrued expenses and accounts payable, and capitalized leases. While Chapter 11 bankruptcy will allow the company to continue operations as it seeks to fund its bankruptcy, it is not uncommon for companies or municipalities to shed underperforming portions of its operations while it attempts to reorganize its debts. The company reported in its bankruptcy filings that reimbursement changes to Medicare payments had caused a dramatic decrease in operating revenue. Additionally, the healthcare organization is embattled in several lawsuits resulting in settlements worth $6.4 million. The entire bankruptcy case could take longer than expected, however, as the US government shutdown has caused lawyers from several federal agencies to be out of work for the foreseeable future.

Future of Dallas Promise Hospital

The future of Dallas Promise Hospital, while seemingly perilous, should remain open during the course of the Chapter 11 bankruptcy case, and hopefully even after the auction sale of the hospital is completed.

Officials from the Dallas hospital state in early January that they do not expect a significant change to care and treatment at the hospital nor any physicians or employees. Dallas bankruptcy attorneys familiar to the case believe that Promise Healthcare itself will be able to emerge from Chapter 11 bankruptcy with a significantly improved financial standing.


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