Adeptus Health
| Company type | Public |
|---|---|
| Industry | Healthcare |
| Founded | 2002 |
| Fate | Filed for bankruptcy protection in 2017; acquired by Deerfield Management |
| Headquarters | Irving, Texas , United States |
Key people | Steven Bussey (President), Thomas Hall (former CEO) |
| Products | Freestanding emergency rooms, for-profit hospitals |
Number of employees | 1400+ |
Adeptus Health Inc. was a health care provider based in Irving, Texas, specializing in operating standalone emergency rooms throughout Texas and Arizona. It served as the parent organization for First Choice Emergency Room, the nation’s largest and longest-standing network of freestanding emergency care centers. The company went public in June 2014, capitalizing on robust revenue growth and rising demand for convenient emergency medical services. Despite this, Adeptus Health filed for bankruptcy protection in June 2017 and was later acquired by the hedge fund Deerfield Management within the same year.
In 2016, Adeptus Health was acknowledged on Fortune's "20 Best Workplaces in Health Care" list, highlighting its effective leadership and positive organizational culture. Steven Bussey held the role of President during this period. At its operational zenith, the firm employed more than 1,400 individuals and pursued market expansion in the competitive healthcare sector through its innovative freestanding emergency room model.
History
Established in 2002, Adeptus Health opened its inaugural emergency room in Flower Mound, Texas. Thomas Hall, who had previously served as CEO of NovaMed, was appointed as president and chief executive officer.
The company debuted on the New York Stock Exchange in June 2014 with an initial public offering of 4.9 million shares priced at $22 each under the ticker NYSE:ADPT. That same year, it entered into a joint venture with Dignity Health to launch a hospital facility in Arizona.
In 2015, Adeptus collaborated with UCHealth, affiliated with the University of Colorado, to develop emergency care centers throughout Denver, Colorado Springs, and northern Colorado. This initiative included managing twelve existing First Choice ER locations along with two new sites. Additionally, Adeptus partnered again with Dignity Health to create the Dignity Health Arizona General Hospital situated in Laveen, Arizona.
By May 2016, Adeptus had rebranded 27 First Choice Emergency Rooms within the Dallas–Fort Worth region under the Texas Health Resources banner. Later that year, it expanded its footprint by entering agreements with Mount Carmel Health System to operate emergency departments in Ohio and with Ochsner Health System to establish new facilities in Louisiana.
Confronted with financial difficulties, Adeptus filed for bankruptcy protection in April 2017. The restructuring process involved delisting Class A shares by October 2017 and culminated in Deerfield Management—a hedge fund specializing in healthcare—taking control of the company. In December 2020, Adeptus proceeded to file for Chapter 7 bankruptcy.
Operations
Adeptus Health managed for-profit hospitals alongside a network of freestanding emergency rooms and was the parent company of First Choice Emergency Room. Prior to forming partnerships with larger healthcare providers, it operated 52 First Choice Emergency Room locations across Houston, Austin, Dallas, Fort Worth, San Antonio, Denver, and Colorado Springs.
As of March 2017, Adeptus maintained ten freestanding emergency centers in Arizona that were co-branded with Dignity Health's Arizona General Hospital.
First Choice Emergency Room
First Choice Emergency Room represented Adeptus Health’s brand of standalone emergency facilities located primarily in Texas and Colorado. Founded by Jack Novak in 2002, it holds the distinction of being both the oldest and largest entity within this niche market in the United States. Under Novak’s leadership as founder and CEO, First Choice earned recognition from Inc. Magazine as one of America’s fastest-growing companies from 2010 through 2012.
In 2012, Sterling Partners injected $59 million to fuel expansion efforts. Revenue grew significantly from $41.3 million in 2009 to $98.5 million by 2012. Following rapid growth that resulted in a network of 52 locations by 2014, most sites had ceased operations by mid-2020.
The corporate strategy of Adeptus Health focused on forging alliances with established healthcare systems; notably, in May 2016 it collaborated with Texas Health Resources to rebrand a majority of its Texas-based facilities under the Texas Health name. A comparable partnership was formed in August 2016 with Mount Carmel Health System operating within Ohio.
Class action lawsuit
In 2016, Adeptus Health along with its board members were subjected to a class action lawsuit accusing them of breaching federal securities regulations and providing deceptive information concerning their internal financial controls and business practices. The lawsuit, titled Oklahoma Law Enforcement Retirement System v. Adeptus Health Inc., was initiated under Sections 11, 12(a)(2), and 15 of the Securities Act of 1933, as well as Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. By 2020, the court sanctioned a $44 million settlement intended for investors who acquired Adeptus Class A common shares between 2014 and 2017.
Additionally, in 2017, a plaintiff from Colorado pursued class action certification against Adeptus over facility fees, claiming the company took advantage of market confusion by not adequately informing patients about excessive charges.