By inewsource Staff

San Diego Hospice filed for Chapter 11 bankruptcy protection today after dramatically cutting back on the number of patients it accepts into care. Chapter 11 would allow the organization to reorganize its finances and stay in business.

Among other debts, the hospice’s petition for bankruptcy lists owing Wells Fargo $4 million, its former building owner $2.5 million, and the Price Family Charitable Fund $800,000.

San Diego Hospice filed under Chapter 11 bankruptcy on Monday, Feb. 4. | Photo by Brad Racino

The hospice provider — the largest in California — has been under federal investigation. The two-year-long audit by Medicare has focused on whether the hospice allowed patients to stay in the program even when their diagnosis changed; in other words, if the patients weren’t necessarily dying in six months or less.

In a statement on its website, San Diego Hospice said Chapter 11 would allow them “to continue our operations, while reorganizing our assets and exploring our structural options to adapt to the current circumstances.” San Diego Hospice said it had cut its patient census by 50 percent over the past three months, “creating additional severe financial challenges.”

In the statement and in a fact sheet to employees, obtained by the Investigations Desk, San Diego Hospice emphasized its continued priority on patient care.

Last week, San Diego Hospice moved operations out of its Mission Valley offices into its Hillcrest hospital building in a cost-cutting move.

Joanne Faryon is a freelance reporter and former inewsource and KPBS reporter.