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Adeptus Health

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Adeptus Health Inc.
Company typePrivate
NYSE: ADPT
IndustryHealthcare
Founded2002; 22 years ago (2002)
Defunct2020 (2020)
FateChapter 7 bankruptcy
Headquarters
Irving, Texas
,
United States
Area served
Arizona, and Texas
Key people
[1]
BrandsFirst Choice Emergency Room
OwnerDeerfield Management
Number of employees
1,409 (2016)
Websiteforsheyprostok.com

Adeptus Health Inc. was a health care provider based in Irving, Texas.[2] Adeptus Health operates free-standing emergency rooms throughout Texas and Arizona.[3][4] It is the parent company of the oldest and largest freestanding emergency-room network in the United States, First Choice Emergency Room.[5][6][7] Adeptus Health became a public company in June 2014,[2] filed for bankruptcy in June 2017,[8] and was acquired by hedge fund Deerfield Management later in 2017.[9]

In 2016, Adeptus Health was included on Fortune's list of the "20 Best Workplaces in Health Care".[10]

History

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Adeptus Health was founded in 2002 with its first emergency room located in a Dallas suburb, Flower Mound, Texas.[2] Thomas Hall is the president and chief executive officer (CEO) of Adeptus Health.[11] Previously, Hall was the president and CEO of NovaMed.[12]

In June 2014, Adeptus Health launched its initial public offering on the New York Stock Exchange with 4.9 million shares at $22 per share under the ticker symbol NYSE:ADPT.[2][13][14] Also in 2014, Adeptus created a joint venture with Dignity Health to open a hospital in Arizona.[15]

In 2015, the company announced a partnership with University of Colorado's UCHealth to develop emergency care facilities in Denver, Colorado Springs, and northern Colorado, including 12 existing First Choice emergency rooms along with two new ones.[16][17] Adeptus also partnered with San Francisco-based Dignity Health to establish the Dignity Health Arizona General Hospital in Laveen, Arizona.[18]

In May 2016, Adeptus reached an agreement with Texas Health Resources in which it rebranded 27 First Choice Emergency Rooms, and all of the FCERs in Dallas–Fort Worth, under the Texas Health name.[19] In August 2016, the company reached an agreement with the Mount Carmel Health System to build and operate emergency rooms in Ohio under the Mount Carmel brand.[20] Adeptus reached an agreement with the Ochsner Health System to build and operate emergency rooms in Louisiana under the Ochsner name in September 2016.[21]

In April 2017, Adeptus Health filed for bankruptcy.[8][22] In October 2017 it announced its financial restructuring, which included the delisting of its Class A shares.[23] After bankruptcy in 2017, healthcare-focused hedge fund Deerfield Management acquired control.[9]

In December 2020, Adeptus filed for Chapter 7 bankruptcy. [24]

Operations

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Adeptus Health operates for-profit hospitals and a network of freestanding emergency rooms. It is the parent company of First Choice Emergency Room.[11] Prior to reaching agreements with healthcare networks, the company owned and operated 52 First Choice Emergency Room facilities located in Houston, Austin, Dallas, Fort Worth, San Antonio, Denver, and Colorado Springs.[25][26]

Within Arizona, as of March 2017, Adeptus operated 10 freestanding emergency rooms that were co-branded with Dignity Health's[18] Arizona General Hospital.[27]

First Choice Emergency Room

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First Choice Emergency Room

First Choice Emergency Room is the operating name under which Adeptus Health operates freestanding emergency rooms in Texas and Colorado.[28][29][30] It is the largest and oldest such provider in the US.[31] First Choice was founded by Jack Novak in 2002.

Inc. Magazine ranked First Choice as one of the fastest-growing businesses in the U.S. in 2010, 2011, and 2012 under CEO and founder, Novak.[29] In 2012, Sterling Partners invested $59 million in the business.[32] First Choice generated $98.5 million in revenue in 2012, up from $41.3 million in 2009.[29] The company had 52 locations after an aggressive expansion in 2014, but as of July 2020 most locations had closed.[33][34][35]

In May 2016, Adeptus Health reached an agreement with Texas Health Resources to align its First Choice Emergency Room locations and rebrand most of its Texas locations as Texas Health Facilities.[36] In August 2016, Adeptus reached a similar agreement with Mount Carmel Health System in Ohio.[37]

Class action lawsuit

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In 2016, a class action lawsuit was filed against Adeptus Health (as well as members of the Company’s board of directors, Sterling Partners, and the joint book-running managers in the Company’s secondary public offering of shares of its Class A common stock) by purchasers of its securities alleging that the company violated the federal securities laws and made false and/or misleading statements, failing to disclose its internal control over financial reporting and the overall status of its business operations.[38][39] The case is Oklahoma Law Enforcement Retirement System v. Adeptus Health Inc., before Judge Amos L. Mazzant III in the Eastern District of Texas, and is under Sections 11, 12(a)(2), and 15 of the Securities Act of 1933, as well as Section 10(b) and 20(a) of the Securities Exchange Act of 1934.[39][40] In 2020, the court approved the payment of $44 million securities settlement to conclude the class action lawsuit.[41] The settlement included all entities and investors who purchased Adeptus Class A common stock from 2014 to 2017.[41]

In 2017, a man from Colorado sued Adeptus and sought class action status involving the facility fees it charged patients.[42] It was alleged that the company took advantage of marketplace confusion and defrauded consumers through its failure to disclose excessive costs.[42]

References

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  1. ^ "Leadership". Archived from the original on November 26, 2016. Retrieved November 26, 2016.
  2. ^ a b c d Daniel Salazar (25 June 2014). "Lewisville-based emergency room provider has steady IPO Wednesday". Dallas Morning News. Retrieved 1 September 2014.
  3. ^ Antonie Gara (25 June 2014). "Adeptus Health IPO Powered by Revenue Growth, Obamacare Reforms". The Street. Retrieved 1 September 2014.
  4. ^ Rice, Sabriya (2017-09-28). "Freestanding emergency room operator Adeptus may soon emerge from bankruptcy". Dallas News. Archived from the original on 2020-11-13. Retrieved 2020-09-18.
  5. ^ Carrie Ghose (16 July 2014). "For-profit Adeptus Health faced opposition in Colorado". American City Business Journals: Columbus Business First. Retrieved 1 September 2014.
  6. ^ Matt Goodman (28 July 2014). "Largest Freestanding ED Chain Opens New Location In Collin County". HealthCare Daily. Retrieved 1 September 2014.
  7. ^ Stephanie Baum (14 July 2014). "Venture-backed healthcare deals rise to $2.7B in Q2". Ortho Spine News. Retrieved 1 September 2014.
  8. ^ a b Brown, Linzee (April 20, 2017). "Adeptus Health Chapter 11 Petition Filed". Bankruptcy Company News. Archived from the original on April 20, 2017. Retrieved April 20, 2017.
  9. ^ a b "Hedge fund takes over Adeptus Health". www.beckershospitalreview.com. 6 October 2017. Retrieved 2019-05-14.
  10. ^ Laura Lorenzetti (April 12, 2016). "These Are the 20 Best Workplaces in Health Care". Fortune. Retrieved July 18, 2016.
  11. ^ a b Jim Fuquay (25 June 2014). "Lewisville-based emergency room operator goes public". Star Telegram. Retrieved 1 September 2014.
  12. ^ "EXECUTIVE MANAGEMENT". First Choice Emergency Rooms. Archived from the original on 26 March 2010. Retrieved 1 September 2014.
  13. ^ "ADEPTUS HEALTH INC. (ADPT) IPO". NASDAQ. Retrieved 1 September 2014.
  14. ^ Bob Herman (27 June 2014). "First Choice Emergency Room's parent goes public". Modern Healthcare. Retrieved 1 September 2014.
  15. ^ Gonzales, Angela (28 October 2014). "Dignity Health creates joint venture for new hospital in Laveen". Phoenix Business Journal. Archived from the original on 2014-11-02.
  16. ^ Rappleye, Emily (21 April 2015). "UCHealth, Adeptus Health to partner on emergency care". Becker's Hospital Review. Retrieved 11 May 2015.
  17. ^ Sealover, Ed (21 April 2015). "UCHealth to grow with deal for First Choice ER facilities". Denver Business Journal. Retrieved 11 May 2015.
  18. ^ a b Dignity Health, Adeptus Health announce joint venture. Shannon Barnet. October 23, 2014. Becker's. December 8, 2015.
  19. ^ Hethcock, Bill (May 11, 2016). "Texas Health Resources and First Choice ER Operator Adeptus Health Join Forces". Dallas Business Journal. Retrieved September 23, 2016.
  20. ^ Ghose, Carrie (August 5, 2016). "Hilliard Hospital Fills Gap in Mount Carmel Network, Kicks off Venture with ER Operator Adeptus". Columbus Business First. Retrieved September 23, 2016.
  21. ^ Griggs, Ted (September 19, 2015). "Ochsner Health System, Adeptus Health Partner on Stand-Alone Emergency Rooms in Greater New Orleans". The Advocate. Retrieved November 26, 2016.
  22. ^ Garrett, Arnessa. "Adeptus files for bankruptcy after string of losses". Dallas Morning News. Retrieved 19 April 2017.
  23. ^ "Adeptus Health". adhc.com. Archived from the original on 1 April 2018. Retrieved 1 April 2018.
  24. ^ "Company Bankruptcy Information for Adeptus Health LLC".
  25. ^ Peggy O’Hare (23 July 2014). "First Choice Emergency Room opens northwest SA site". San Antonio Express News. Retrieved 1 September 2014.
  26. ^ "First Choice Emergency Room improves data center efficiency and network security" (PDF). Archived from the original (PDF) on 2014-10-16. Retrieved October 11, 2014.
  27. ^ Rice, Sabriya. "Freestanding ERs proliferate in Texas". Dallas Morning News. Archived from the original on 2017-08-08. Retrieved 2017-07-12.
  28. ^ Laden, Rich. "Ex-Blockbuster store being transformed into ER". Gazette.com. Archived from the original on January 13, 2013. Retrieved February 25, 2013.
  29. ^ a b c "First Choice Emergency Room". Inc. Magazine. Retrieved February 28, 2013.
  30. ^ "Adeptus Health Announces Pricing of Initial Public Offering". MarketWatch. June 25, 2014. Retrieved August 10, 2014.
  31. ^ "New First Choice Emergency Room Facility Set to Open in Austin, Texas". San Francisco Gate. Retrieved February 25, 2013.
  32. ^ Hethcock, Bill. "First Choice Emergency Room plans $100M expansion". Dallas Business Journal. Retrieved August 26, 2016.
  33. ^ Bill Hethcock. "First Choice freestanding ER chain growing fast". Dallas Business Journal. Retrieved March 12, 2014.
  34. ^ Sabrina Rodak (27 March 2013). "HCA, First ER Partner to Smooth Patient Transfers to Hospitals". Becker's Hospital Review. Retrieved March 12, 2014.
  35. ^ "First Choice Emergency Houston, TX - Last Updated July 2020". Yelp. Retrieved 2020-07-19.
  36. ^ Hethcock, Bill (May 11, 2016). "Texas Health Resources and First Choice ER Operator Adeptus Health Join Forces". Dallas Business Journal. Retrieved August 26, 2016.
  37. ^ Ghose, Carrie (August 5, 2016). "Hilliard Hospital Fills Gap in Mouth Carmel Network, Kicks Off Venture with ER Operator Adeptus". Columbus Business First. Retrieved August 22, 2016.
  38. ^ Nguyen, Olivia (2017-03-20). "Class Action Lawsuit Against Adeptus Health Alleges Misleading Statements, Securities Violations « D CEO Healthcare". Healthcare.dmagazine.com. Retrieved 2019-09-17.
  39. ^ a b "Form 8-K"
  40. ^ Oklahoma Law Enforcement Retirement System v. Adeptus Health Inc.
  41. ^ a b "Adeptus $44 Million Securities Settlement Gets Final Approval". news.bloomberglaw.com. Retrieved 2022-08-11.
  42. ^ a b "Lawsuit claims freestanding emergency room operator scams patients". Dallas News. 2017-01-11. Retrieved 2022-08-11.
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