Liberty Medical files for bankruptcy
PORT ST. LUCIE, Fla. – The changes at Liberty Medical Supply are happening at a dizzying speed.
Just months after a group of company execs bought Liberty Medical from its parent company, they filed for Chapter 11 bankruptcy on Feb. 15, according to news reports.
In its filing, Liberty Medical cites between $100 million and $500 million in both assets and liabilities, and between 1,000 and 5,000 employees. It lists several unsecured creditors with disputed claims, including CGS Administrators, a Medicare claims processor, for $137.2 million; and its former owner Medco Health Solutions, a unit of Express Scripts Holding Co., for $14.2 million.
President and CEO Frank Harvey told local news station WPTV that several unexpected events led to the filing, including a dispute with Express Scripts over tax liabilities and a significant recoupment by Medicare.
“When you look at the recoupment, the federal government is pulling back $3.2 million a month from us, and they will not even give us a court date,” he told WPTV. “They could continue to do that for a long time.”
The execs planned to lay off more than 200 employees on Feb. 15, but they will now keep them on for at least two more weeks, according to WPTV.
Medco Health Solutions acquired Liberty Medical’s parent company, Polymedica Corp., which has also filed for Chapter 11 bankruptcy, in 2007. Express Scripts Holding Co. purchased Medco in April but then announced plans to divest the business. Express Scripts sold the business to the execs in December.
Liberty Medical provides diabetes supplies to more than 1 million Americans, according to its web site.