Cano Health Files for Bankruptcy

A Precautionary Tale of Financial Failure in Healthcare



Cano Health’s Chapter 11 filing is a clear case study in how aggressive expansion, leveraged capital structures, and operational complexity can collide in value-based care. For healthcare operators and payer-aligned provider groups, the story is less about a single company’s outcome and more about recurring risk patterns: rapid multi-state growth, margin compression, liquidity stress, and governance instability—followed by asset sales and restructuring to preserve a narrowed core business.
Sources: https://www.reuters.com/markets/deals/cano-health-files-bankruptcy-receives-150-mln-financing-commitment-2024-02-05/, https://www.prnewswire.com/news-releases/cano-health-announces-successful-emergence-from-chapter-11-302186063.html

Who Is Cano Health?

Cano Health operated as a value-based primary care and population health organization, with a model heavily oriented toward seniors and Medicare-aligned risk arrangements in certain markets. The company positioned its approach around coordinated primary care, clinic-based access, and managed utilization—core attributes common across many risk-bearing primary care platforms serving Medicare Advantage and related programs

How Many Members Did Cano Health Manage?

At its peak, Cano reported membership totals around the low-to-mid 300,000 range, including substantial Medicare-aligned membership. However, as liquidity tightened, Cano disclosed plans to exit and wind down multiple non-core markets and to consolidate operations—moves that typically reduce attributed lives and clinic footprint as the organization refocuses.

Sources: FierceHealthcare, PRNewsWire

Market Footprint and Florida Concentration

Cano’s operational center of gravity was Florida. As restructuring accelerated, Cano publicly emphasized optimization and continued operations focused on the Florida market, reflecting a strategic retreat from broader geographic ambition to preserve the most viable core footprint.

Leadership Turnover and C-Suite Instability

Cano experienced notable executive turnover during the period leading up to Chapter 11. Leadership changes during liquidity stress can signal both governance intervention and the practical need to reset strategy, creditor negotiations, and operational execution. While leadership turnover alone does not cause insolvency, it often coincides with restructuring phases in which near-term stabilization takes priority over long-term growth initiatives.

Sources: Reuters

Pre-Bankruptcy Workforce Reductions and Cost-Cutting

Cano announced substantial workforce reductions as part of a broader effort to reduce costs and stabilize liquidity. Public company disclosures described planned reductions of approximately 700 employees (about 17% of the workforce at the time), alongside market exits and operating simplification efforts intended to drive significant annualized cost savings over subsequent quarters.

Leadership Turnover and C-Suite Instability

Cano experienced notable executive turnover during the period leading up to Chapter 11. Leadership changes during liquidity stress can signal both governance intervention and the practical need to reset strategy, creditor negotiations, and operational execution. While leadership turnover alone does not cause insolvency, it often coincides with restructuring phases in which near-term stabilization takes priority over long-term growth initiatives.

Financial Turmoil and the Chapter 11 Filing

Well before the bankruptcy filing, Cano took visible steps to generate cash, reduce obligations, and narrow its footprint. A key example was the sale of Texas and Nevada centers to Humana’s CenterWell Senior Primary Care business for roughly $66.7 million (often reported as approximately $67 million). This divestiture occurred alongside broader plans to exit certain markets and reduce overhead. 

Sources: Cano Official Chapter 11 Filing Docume

What's Next for Cano Health Employees and Members?

Restructuring Outcome: Emergence and Privatization

Cano moved through a court-supervised restructuring process and announced a successful emergence from Chapter 11 on June 28, 2024. The company reported it emerged as a reorganized private company with a materially revised capital structure and an operational strategy focused on its Florida market. This outcome is consistent with a restructuring pattern where creditor claims are reorganized, ownership shifts, and operations are narrowed to the strongest remaining footprint.

Key Takeaways from Cano Health

Cano Health’s bankruptcy is a cautionary example of how growth without durable unit economics and disciplined capital planning can destabilize care delivery organizations—especially those operating in risk-based arrangements. Expanding across multiple states and payers increases operational complexity, contracting variability, medical cost volatility, and compliance exposure. When financial performance deteriorates, the operational consequences are not limited to investors; they can affect clinic access, staffing stability, and continuity of care for attributed populations.

In today’s market, sustainable growth requires a clear path to profitability, conservative liquidity management, and governance discipline—particularly when serving Medicare-aligned populations where documentation, coding accuracy, risk adjustment integrity, and medical necessity oversight carry both financial and regulatory stakes.