Medical transportation firm Modivcare Inc. filed for bankruptcy in an effort to shed $1.1 billion of debt, after federal health-care funding cuts threatened to crimp future cash flows.

The shares tumbled 19.5% in overnight trading.

The company filed for Chapter 11 in the US Bankruptcy Court for the Southern District of Texas on Wednesday, according to a statement. Bloomberg previously reported that Modivcare was weighing a Chapter 11 filing.

A group of first-lien and second-lien lenders have agreed to provide $100 million of debtor-in-possession financing, which will be used to support operations during the process, according to the statement.

In recent weeks, the company was huddling with lenders about how to potentially restructure its debt load and pursuing asset sales in a bid to avoid bankruptcy. The company has roughly $1.4 billion of debt including a revolving facility due in 2028, according to data compiled by Bloomberg.

Modivcare provides in-home care and remote patient monitoring and coordinates rides to appointments for non-emergency patients. It contracts with national and regional plans to provide these services, including for low-income patients through the government-funded Medicaid program.

All of Modivcare’s service lines will continue to operate in the ordinary course, with no expected interruption of business, the company said in its statement.

Medicaid is facing an overhaul after Republican lawmakers won efforts to make administrative changes, including introducing a biannual process of redetermining eligibility. So-called redeterminations have already taken a toll on Modivcare’s margins, according to S&P Global Ratings.