Quorum Health emerges from bankruptcy with new CEO, board

QUORUM HEALTH last week emerged from Chapter 11 bankruptcy with a new CEO and board and stronger financial footing.

Former Acadia Healthcare CEO Joey Jacobs now heads the Brentwood, Tenn.based for-profit company, which said it achieved the plan outlined in its April restructuring agreement with lenders and reduced debt by about $500 million. The agreement included a $100 million commitment from bondholders and a $200 million equity commitment in exchange for shares in the reorganized company. Quorum said it also restructured its balance sheet.

Completing the process allows Quorums’ 22 affiliated hospitals in rural and midsize markets to continue delivering care, Jacobs said in a statement. “We appreciate the court’s diligence and are grateful for the wisdom of our bondholders in recognizing the strength of our operations and taking the difficult but necessary steps to provide a platform for success.”

Franklin, Tenn.-based Acadia ousted Jacobs as CEO in 2018, a position he’d held since early 2011. At the time, the board’s chairman said the behavioral health services provider needed a new leader to accelerate Acadia’s momentum and drive value creation. Under his leadership, the company grew from six locations to 586 facilities in 40 states, the United Kingdom and Puerto Rico.

Prior to Acadia, Jacobs co-founded Psychiatric Solutions and served as its chairman, president and CEO. Before that, he spent more than two decades at HCA Healthcare. He will also serve on Quorum’s revamped board of managers.

In addition, Martin Smith is now Quorum’s president and chief operating officer. Smith joined the company when it was formed in 2016 and previously served as executive vice president and chief operations officer. Catherine Klema, president of financial advisory and consulting firm Nettleton Advisors, will lead Quorum’s reconstituted board. She previously worked for investment banks and also serves on the board of Montefiore Medicine. ●