Hospital Liquidations

Over the past few years, a number of factors have combined to reduce the financial viability of hospitals throughout the country. Hospitals in depressed areas have been particularly hard hit: Many patients have lost health care insurance along with their jobs, and with patients less able to afford routine and preventative care—and even medication—they are sicker than ever before upon admission. At the same time, it has become harder to attract medical staff to depressed areas and hospitals have had to raise salaries to entice doctors and nurses to sign on. These factors, combined with pressures to contain
health care costs, are increasing the incidence of hospitals filing for bankruptcy.

When possible, particularly when alternate health care facilities are not available, creditors will allow a hospital to continue to operate under Chapter 11 bankruptcy protection while they reorganize. When a hospital files for bankruptcy under Chapter 7, however, it is generally required to immediate cease operation and to liquidate its assets as quickly as possible in order to repay creditors.

While hospital closures often create local health care gaps, liquidations benefit other institutions and facilities that require high-quality medical equipment. Liquidated hospital equipment is generally well-maintained. Because health regulations often require that equipment be replaced fairly frequently, the equipment that is sold under liquidation is often relatively new.

Equipment from liquidation sales may include sophisticated imagining devices such as MRI, PT and CAT scanners, as well as ultrasound machines. Basic equipment, including full operating rooms, sterilization stations and furniture for patients’ rooms and waiting areas are offered in quantity.

For hospitals that are financially pressed, liquidation sales provide a cost-effective way to upgrade their physical plant at a fraction of the cost of new equipment. Purchasing maintenance contracts for sophisticated or complex equipment mitigates the risk inherent in purchasing used equipment, while still significantly reducing overall expense vis a vis new equipment.

More information regarding hospital liquidations