Axcess Medical Imaging files Chapter 11

Stephen M. Miley, MD, has resigned as CEO of Axcess Medical Imaging, and the company and its subsidiaries has filed for Chapter 11 bankruptcy.

The Sarasota, Fla.-based Axcess, which owns and operates imaging centers on Florida’s west coast, will continue to operate all its imaging centers, including seven locations acquired in April, as it reorganizes under Chapter 11. Douglas P. Badertscher was appointed by the bankruptcy court as the company’s chief restructuring officer.

“My decision to step down from the role as CEO was made after determining that our day-to-day decisions and operations are left in excellent and experienced hands of our chief restructuring officer,” said Miley.

His resignation was effective July 15.

The U.S. Bankruptcy Court documents filed in the Middle District of Florida indicate that the company ran into trouble due to rapid growth amid declining reimbursement rates.

Axcess, founded by Miley and John Uphold, MD, began operations in 2001 with a single facility in Venice, and then expanded into Bradenton, in 2004 and Sarasota, in 2006. In May 2008, Axcess completed a reverse merger into a public over-the-counter bulletin board shell company and obtained a $1 million convertible note to fund some of its operations and going-public costs. In August 2008, the provider began work to open a new 55,000 square foot Axcess Medical Center in Northport.

In April, Axcess closed on the acquisition of seven MRI centers, after agreeing to pay $200,000 in cash and to assume $3.8 million in debt, according to a filing with the Securities and Exchange Commission.

The bankruptcy filing stated that Axcess was not sufficiently capitalized to withstand the combination of rapid expansion and declining revenue.

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