Diabetes America Files For Chapter 11 Protection in Texas

Diabetes America, Inc., which operates a network of 17 centrally-managed medical clinics that provide comprehensive outpatient medical care, primarily to patients with Type 1, Type 2 and Gestational Diabetes, filed for bankruptcy protection on Tuesday in Houston. The company’s clinics are located in Texas and Houston and generate 51,000 patient visits per year. The clinics have generated average monthly revenues of almost $1.3 million to date in 2010.

The company blamed Tuesday’s bankruptcy filing on “several financial set-backs, the impact of which still continue to strain the Debtor’s cash flow.” These financial problems include long-term lease commitments, including one for a clinic location that the company has failed to open, and an inability to adjust operating expenses at underperforming centers. The company also suffered from billing issues with Medicare, Medicaid, and Aetna. The company filed for bankruptcy protection in hopes of effectuating a plan developed with the assistance of Healthcare Markets Group intended to “restructure its obligations, improve its revenue, discontinue underperforming operations and continue as a going concern.”
Key court filings to date include (click on the title of any document for more information or to purchase):

For access to all major pleadings filed in this case, please visit http://www.chapter11cases.com/Diabetes-America-Inc_c_13874.html

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