Case Summary: Landmark Hospitals Chapter 11

Business Description

Landmark Holdings of Florida, LLC, along with its Debtor affiliates⁽¹⁾ (collectively, “Landmark” or the “Company”), operates five Long-Term Acute Care (LTAC) hospitals located in Athens, GA; Cape Girardeau, MO; Columbia, MO; Joplin, MO; and Savannah, GA⁽²⁾.

The Company specializes in treating medically complex patients requiring prolonged hospital stays, primarily addressing ventilator weaning, respiratory therapy, complex wound management, and post-intensive care rehabilitation.

• Landmark positions its hospitals as regional referral centers, sustaining strong partnerships with acute-care hospitals reliant on the Company’s facilities to manage extended recoveries.

Landmark reported approximately $79.4 million in revenue for fiscal year 2023, representing an increase of over $7 million YoY.

The Debtors filed for Chapter 11 protection on Mar. 9 in the U.S. Bankruptcy Court for the Middle District of Florida. As of the Petition Date, the Debtors reported $50 million to $100 million in both assets and liabilities.

⁽¹⁾ A list of the Debtors is provided in the Organizational Chart below.

⁽²⁾ Landmark also provides management services to a sixth LTAC hospital in Lehigh Acres, FL that it does not own.

Corporate History

Landmark was formed in 2006 by Dr. William K. Kapp III, opening its first LTAC facility in Cape Girardeau, MO, through a joint venture with Saint Francis Medical Center’s development arm.

• The Company expanded rapidly, opening hospitals in Joplin, MO (2007); Athens, GA (2008); Columbia, MO (2009); and Savannah, GA (2014).
• Strategic partnerships, notably with local health systems such as Freeman Health System and Mercy Hospital in Joplin, provided stable referral streams and operational support.

In 2015, the Company received growth capital from private equity firm Praesidian Capital, funding expansion, technological enhancements, and infrastructure modernization, including upgraded revenue cycle management systems.

Organizational Chart

• Landmark Management Services of Florida, LLC (“LMS”), wholly owned by Landmark Holdings of Florida, LLC, houses the senior leadership team responsible for healthcare management services across all Debtors’ hospitals and a non-Debtor facility in Lehigh Acres, FL.

Operations Overview

Landmark operates specialized LTAC hospitals targeting medically complex patients requiring extended stays of 25+ days. Serving as regional referral centers, the facilities specialize in ventilator weaning, complex wound care, and post-ICU rehabilitation in coordination with acute-care hospitals.

• As of the Petition Date, the Company employs approximately 625 individuals, supplemented by independent physicians and third-party staffing agencies.

Hospital Structure and Services

• Standalone facilities with 30–42 private rooms, equipped for ventilator support, dialysis, telemetry, and advanced wound care.
• Services include ventilator weaning, wound care, post-ICU rehab, and daily physician oversight, with select locations featuring inpatient rehab units for transitional care.

Revenue Model and Operations

• Revenue primarily comes from Medicare’s LTCH-PPS and negotiated private insurer rates, with admissions sourced exclusively from acute-care hospital referrals.
• Corporate services—including finance, HR, compliance, billing, and IT—are centralized under Debtor LMS, while individual hospitals operate under local leadership teams.
• The HCS Interactant platform streamlines billing and revenue cycle management, providing real-time financial and clinical performance insights.

Clinical and Care Model

• Landmark employs an interdisciplinary approach with high staff-to-patient ratios, integrating physicians, nurses, therapists, pharmacists, and social workers to improve outcomes and reduce complications.

2024 Revenue Breakdown by Entity

Prepetition Obligations

Top Unsecured Claims

Events Leading to Bankruptcy

Operational and Financial Pressures

• Landmark initially saw an uptick in patient census at the onset of the COVID-19 pandemic, but conditions rapidly deteriorated as labor costs surged and federal reimbursement rates failed to keep pace with rising healthcare expenses.
• The expiration of the public health emergency on May 23, 2024 further exacerbated the Company’s financial strain, as new regulatory restrictions limited patient eligibility for admission to its facilities.
• While revenue grew by more than $7 million YoY to approximately $79.4 million in 2023, costs ballooned. Skilled nursing wages and benefits jumped 29% since 2020, contract labor costs spiked 229%, and pharmaceutical expenses continued rising between 2022 and 2024.
  • Despite implementing cost-cutting measures—including workforce reductions, outsourced billing, and lease renegotiations—Landmark was unable to offset mounting financial pressures.
• The combination of these factors strained the Company's ability to generate cash flow sufficient to service its outstanding debt obligations.

Prepetition Restructuring Efforts and Lender Actions

• To address liquidity concerns, Landmark sought to defer a December 2024 principal payment under its Main Street Loan, requesting that its lender, Amerant, submit a deferral request to the Federal Reserve Bank of Boston, which owns a 95% participation interest in the Main Street Loan. However, the Company did not receive a decision on the request before the payment due date.
• On December 9, 2024, Amerant swept Landmark’s primary operating account to cover a quarterly interest payment, creating a provisional overdraft of approximately $250,000 and leaving the Company unable to cover certain critical vendor payments. Landmark was forced to reallocate payroll funds to address the shortfall.
• On March 10, 2025, following notice of the bankruptcy filing, Amerant attempted to debit an additional $5.37 million from a Landmark account, creating another substantial provisional overdraft. The transaction was later reversed.

Decision to File Chapter 11

• With no resolution on its loan modification request and liquidity pressures intensifying, Landmark filed for Chapter 11 protection on March 9, 2025. 
  • The Company plans to fund ongoing hospital operations through cash collateral, pending consent from Amerant or court authorization.
• Landmark expects to file a bidding procedures motion soon, setting a timeline to market its assets.

Initial Budget

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