24 Puerto Rico Hospitals on Verge of Filing for BK

M.A. Dworkin

San Juan - Multiple hospitals in Puerto Rico are financially distressed and at risk of closure due to a systematic healthcare crisis. This crisis is driven by several long-standing issues, including chronic underfunding, the emigration of medical professionals, and the aftermath of natural disasters, namely the recent Hurricane Maria. The COVID-19 pandemic further accelerated financial collapse causing hospital occupancy to plummet, leading to an estimated $1.1 billion in losses for Puerto Rico’s hospitals between March 2020 and December 2021. 

Puerto Rican Rep. Gabriel Rodriguez Aguilo, stated that in an overview of the island’s 42 hospitals there exists the possibility that some 24 of them could file for bankruptcy, and that 17 others might close down completely within the next two years. 

Mr. Rodriguez Aguilo reported that several factors were contributing to the rising costs of Puerto Rico’s healthcare system, including migration, delayed payments from insurance companies, and weekly bonuses for physicians. 

“The hospital must provide, in addition to its contract with the insurance company, a weekly bonus to the physician so they can see the patients they have referred,” Mr. Rodriguez Aguilo said. “These are the factors that increase the hospital’s operational costs because no one reimburses that extra expense for the doctor. No insurance company covers that. It is assumed that if the doctor is contracted by the insurance company, they will see the insurance company’s patients and, if necessary, go to the hospital to attend to those patients,” the Legislator stated.

After more than 60 years in operation, Hospital del Maestro was ordered to close in August 2025 by the Department of Health due to financial collapse and patient safety concerns. In recent years, at least seven other hospitals have filed for bankruptcy, and others have been sold, indicating a broader, island-wide pattern of financial instability.

One of the main factors to the demise of the system is discriminatory federal funding. Despite being U.S. citizens, Puerto Ricans receive significantly lower federal healthcare funding than residents on the mainland. Annual per capita spending in Puerto Rico is approximately $4,000 while the mainland average is $13,000. Over the past decade, this disparity has resulted in nearly $300 billion in lost funding for Puerto Rico. 

The situation is worsened by recent and proposed federal cuts to Medicare and Medicaid programs, which disproportionately affect Puerto Rico’s vulnerable population. 

Also, over the past two decades, nearly a quarter of Puerto Rico’s population has emigrated to the mainland. This exodus includes a high number of young professionals, including doctors and nurses, who are lured away by higher salaries and better working conditions. The remaining population is older and poorer, with higher rates of chronic illness and a greater dependence on Medicare and Medicaid, which offer lower reimbursement rates.     

Rep. Rodriguez Aguilo said that he will seek solutions for the issues that are currently jeopardizing the stability of the Puerto Rican hospital system. He added that the population aged 65 and older in Puerto Rico is projected to increase by 30 percent in the coming years. 

“That is why we are currently working in the House of Representatives to develop both short and long term plans.”