New York residents may have noticed that pharmacies, shopping malls and hospital waiting rooms now often feature health care kiosks that allow patients to speak with doctors remotely. These kiosks are also able to perform a limited number of diagnostic tasks, and many in the health care field believe that they have a bright future. However, growth in this highly competitive market has fallen short of projections, and one of the most prominent companies filed for bankruptcy in January.
Analysts say that the writing had been on the wall for cash-strapped HealthSpot Inc. Reports emerged on Jan. 6 indicating that the Ohio-based company had ceased trading, and an attorney speaking on behalf of HealthSpot said that insufficient working capital was the reason that the decision was made to file for Chapter 7 bankruptcy. Xerox and Cox Communications are two of HealthSpot’s creditors, and they seem unlikely to recoup much of the $16 million they are owed as the troubled company’s assets consist mainly of 137 unused medical kiosks.
While news of the company’s bankruptcy was widely expected in recent weeks, things had previously been looking good for HealthSpot. The company announced a partnership with the technology giant Samsung in September 2015. The two companies agreed to work together to develop new features for the kiosks that would allow blood samples to be collected and analyzed. The company also had a number of prominent clients including the Rite Aid chain of pharmacies.
Businesses with financial challenges often file a Chapter 11 bankruptcy as it allows the company to continue in operations while debt issues are being addressed. However, when a business has run its course and there is no possibility that it will continue, filing a Chapter 7 bankruptcy may be the wisest course of action. Bankruptcy attorneys could help business owners with this difficult decision by assessing the revenues, assets and liabilities of the company in question.