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A HEALTHCARE provider based out of the United Kingdom has shut down its operations in the United States, filing for bankruptcy and leaving employees and patients with questions.
Last month, it was confirmed that London-based Babylon Health filed for a Chapter 7 bankruptcy.
It’s a strategy often used by business operations that seek to “terminate their enterprises” and get relief from debts, per the Internal Revenue Service.
It completely liquidates assets rather than providing an opportunity to re-organize and restructure efforts to continue business further, like with a Chapter 11 filing.
Babylon Health closed its subsidiaries — Babylon Healthcare and Babylon Inc — within the United States, per official documents filed to a Delaware bankruptcy court obtained by Becker’s Hospital Review.
The healthcare company reportedly intended to combine with digital neuro therapy company MindMaze, but the deal fell through.
Read More on Bankruptcies
Babylon Health’s announcement that the deal with MindMaze would “not proceed,” continued to note its intentions to focus “on continuing the day-to-day operations of its UK business.”
The company added it would be “exiting its core US business and plans to safely transition its US members to other providers.”
The Babylon Health subsidiaries each contained liabilities ranging from $100 to $500million, according to court documents and the company’s chief operating officer, Paul-Henri Ferrand.
On August 7, Babylon Health also shut down its US headquarters in Austin, Texas, per Forbes.
The healthcare company filed a notice to the Texas Workforce Commission noting its intentions to “permanently close.”
The closure resulted in the firing of around 94 employees.
As of December 2022, 35 percent of Babylon Health’s workforce consisted of United States-based staff, per its website.
Under the Worker Adjustment and Retraining Notification Act (WARN), the company was legally required to provide the workforce with at least 60 days’ notice of a mass layoff.
“We reasonably believed in good faith that providing such notice would have made it impossible for us to obtain the needed capital we sought with multiple parties over the last several months,” the company wrote in a notice filed to the state of Texas obtained by Forbes.
The bankruptcy filing and headquarters closure also resulted in the sudden cancellations of several patient appointments with the provider.
A New York patient who preferred to be named solely as Linda explained that the shutdown was shocking as she went to log in for a scheduled therapy session and found an alert instead, per a screenshot of the Babylon application she provided to Forbes.
“Babylon’s clinical services and appointments are no longer available,” the message read.
“For details about your health plan benefits and to find a new provider, contact your health plan.”
The transition to a new healthcare provider was allegedly left to that of the patients, according to another message Linda received in the e-mail inbox that she showed to the publication.
“We know you may have questions about this change. Your health plan’s dedicated Member Services team can assist you,” the company wrote.
“You can find your health plan’s contact information on your ID card.”
Last year, Babylon Health recorded over a $369million operating loss.
The U.S. Sun has contacted the healthcare provider for further comment on its bankruptcy filing and headquarters closure.
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