Nancy Hunt arrived at an emergency room from a Genesis HealthCare nursing dwelling in Pennsylvania in such dreadful form, together with maggots infesting her gangrened foot, that the hospital referred to as an elder abuse hotline after which the police, her son alleged in a lawsuit.
Hunt died 5 days later. Her dying certificates mentioned the foot harm was a “important” issue. Genesis denied wrongdoing however agreed to pay $3.5 million in a settlement Hunt’s son signed in August 2024.
But Genesis hasn’t paid most of that debt, courtroom information present. It could by no means must.
As soon as the nation’s largest nursing dwelling chain, Genesis says it was spending $8 million a month defending and settling lawsuits over resident accidents and deaths lately. However the firm is now poised to wipe the legal responsibility slate clear by looking for refuge in probably the most protecting nook of the authorized system for the nursing dwelling business: chapter courtroom.
The Genesis case, certainly one of 11 giant senior care bankruptcies this yr, illustrates how well being care corporations can dodge public and monetary accountability for alleged negligence by way of delays, confidentiality clauses, and chapter maneuvers, a KFF Well being Information investigation discovered.
When it filed for chapter in Dallas in July, Genesis estimated its complete legal responsibility for practically a thousand settled and pending lawsuits at $259 million. A KFF Well being Information assessment of the phrases of 155 settlement agreements and company monetary statements reveals Genesis officers knew insolvency was potential but included provisions in its settlement agreements permitting it to defer cost, typically for a yr or extra.
In consequence, Genesis paid nothing in 85 instances and solely a portion within the different 70, in response to civil courtroom information and chapter claims made accessible by way of individuals with entry to them. It nonetheless owes $41 million of the $58 million it had agreed to pay in these instances, the information present.
“It simply appears like they killed my mother and received away with it,” mentioned Vanessa Betancourt, whose mom, Nellie Betancourt, a retired nurse, fractured her hip at a Genesis dwelling in Albuquerque, New Mexico — an harm the health worker’s report mentioned led to her dying. Genesis agreed to a $650,000 settlement with Betancourt’s household in April beneath the situation it will not must pay the primary of seven installments for one more yr, in response to the settlement doc.
Adria Malcolm for KFF Well being Information
Genesis denied wrongdoing in all lawsuits and settlements. In a written assertion, the corporate didn’t reply questions on particular person private harm instances. The assertion mentioned Genesis remained “centered on delivering high-quality, compassionate care to our sufferers and residents with out disruption” throughout chapter.
One lawsuit Genesis settled for practically $1 million alleged nursing dwelling managers ignored repeated warnings a few male resident’s conduct earlier than he sexually assaulted a feminine Alzheimer’s affected person, in response to courtroom information. In a case the corporate resolved for $500,000, a Genesis nursing dwelling was accused of delaying the hospitalization of a resident who had vomited brown mucus. He died of a bowel obstruction. Genesis has paid nothing for both settlement, in response to chapter claims.
Collectors, together with households of the deceased, are anticipated to salvage a fraction of what they have been promised, if something. On Dec. 10, the corporate’s homeowners have been scheduled to hunt approval by the U.S. Chapter Court docket for the Northern District of Texas to promote its nursing properties and different property to its largest investor, a non-public fairness agency. In courtroom papers, legal professionals for residents and different collectors say the advanced plan will forestall them from pursuing Genesis’ new possession and different corporations they blame for the corporate’s collapse.
John Anthony, a chapter legal professional representing 340 private harm claims towards Genesis, mentioned, “They by no means had any intention to honor these offers.”
Low rankings and fines
Throughout years of economic turmoil, Genesis has ceaselessly struggled to supply top-notch care, federal information present. Utilizing its five-star system, the Facilities for Medicare & Medicaid Companies rated 58% of properties affiliated with Genesis as under common or a lot under common. CMS has fined Genesis properties $10 million for violating federal well being requirements over the previous three years.
In 2022, Connecticut well being regulators shuttered a Genesis dwelling after two deaths and a number of violations. The corporate closed one other Connecticut nursing dwelling this yr after residents twice have been evacuated over security issues.
In its Chapter 11 submitting, Genesis mentioned it cared for about 15,000 residents in 165 nursing properties and 10 assisted dwelling services in 18 states. They’re centered in Pennsylvania, West Virginia, New Mexico, New Hampshire, New Jersey, Maine, Alabama, Maryland, and North Carolina, in response to the chapter submitting.
The corporate mentioned it owed $709 million in secured debt to lenders and the IRS. Below chapter guidelines, these money owed, backed by Genesis collateral, take priority over the $1.6 billion in unsecured debt Genesis mentioned it owes. Unsecured collectors embrace a pension fund; contractors that supplied well being companies and tools; Pennsylvania, New Mexico, and West Virginia for unpaid supplier taxes; and former residents and their households who sued.
Risks in reminiscence care
Sandia Ridge Heart, a Genesis dwelling in Albuquerque, was repeatedly faulted by well being regulators for not stopping sexual misbehavior in its reminiscence care unit. In November 2021, CMS cited the house for missing sufficient nurses to stop sexual abuse amongst residents. An inspection report the next August recognized extra inappropriate sexual contact. Police have been referred to as to research sexual assault allegations in February and March of 2023, police stories present; neither resulted in prison prices.
Then in April 2023, a 61-year-old male resident with alcohol-related dementia sexually assaulted a feminine resident with Alzheimer’s within the eating room, in response to a police report and an inspection report. When the resident screamed for him to cease and that he was hurting her, he responded “shut up bitch I do know you want this,” in response to a lawsuit introduced on behalf of the girl, recognized in courtroom papers as R.S.
Sandia Ridge administration had been conscious of the male resident’s behavioral points for months, in response to worker depositions within the case. Police had investigated a prior sexual assault allegation towards him the earlier yr with out bringing prices. In a single deposition, a former actions assistant testified he hit her and twice pushed her into a toilet whereas asserting, “I wish to have intercourse with you.” When she reported him to a senior Genesis supervisor, she mentioned within the deposition, the supervisor put his finger over his lips and mentioned, “Shhh.”
The actions employee testified that R.S. used to fortunately sing together with Elvis Presley songs. After the assault, the employee mentioned, R.S. “do not sing anymore.”
Inspectors cited the house for failing to guard R.S. The identical report mentioned the house did not present a therapist for one more feminine resident who was being sexually harassed. Medicare fined Sandia Ridge Heart $91,247. Genesis denied legal responsibility however settled R.S.’ lawsuit for $925,000 in Could, in response to the chapter declare.
“We simply felt we’ve to carry them accountable,” R.S.’ daughter mentioned in an interview, talking on the situation that she and her mom not be recognized, due to the character of the assault. “Perhaps I am flawed, possibly I am naive, however the one means to do this is to sue somebody, proper?”
Genesis has not paid any of the settlement, in response to the household’s declare submitting.
Development and debt
Genesis’ downfall might be traced to 2007, when associates of two personal fairness companies acquired the corporate in a $1.5 billion leveraged buyout, taking up substantial debt, in response to its chapter submitting. Non-public fairness additionally has been concerned in different well being care bankruptcies, together with these of the HCR ManorCare nursing dwelling chain, the jail well being care contractor Corizon Well being, and two for-profit hospital techniques, Steward Well being Care and Prospect Medical Holdings.
In 2011, Genesis raised $2.4 billion by transferring considerably all its nursing dwelling buildings and different actual property to Welltower, a publicly traded actual property funding belief, in response to Genesis’ chapter submitting. Genesis then rented the buildings again from Welltower, which made leasing prices a major expense.
Genesis went on a nationwide shopping for spree. At its peak in 2016, it had grown to greater than 500 nursing properties. In a courtroom declaration, Louis Robichaux IV, a guide overseeing Genesis’ chapter restructuring, wrote that as the corporate expanded, it turned tougher to handle and “mired in company inefficiencies.” Robichaux wrote that Genesis’ monetary woes have been exacerbated by quickly growing labor prices and lawsuits, together with some predating the COVID pandemic.
Beginning in 2021, Genesis prevented chapter after receiving $100 million in loans from a personal fairness agency based by Joel Landau, the proprietor of a Brooklyn-based nursing dwelling chain, in response to Robichaux’s submitting.
However Genesis continued to teeter on the sting of insolvency. In audited monetary statements for 2022 and 2023 submitted to a California oversight company, administration and auditors mentioned hire and debt obligations raised “substantial doubt concerning the firm’s capability to proceed as a going concern.”
Adria Malcolm for KFF Well being Information 
In a courtroom submitting, a committee appointed by the U.S. Trustee’s Workplace to symbolize the unsecured collectors within the chapter accused Landau and Welltower of orchestrating a covert plan that allowed Welltower to maintain getting its rents whereas Landau may run the corporate and “siphon worth to himself.” The committee alleged their efforts pressured the corporate into insolvency whereas “staffing ranges and affected person care declined precipitously.” Landau and Welltower didn’t reply to requests for remark.
Drawn-out lawsuits
Erin Pearson sued Genesis over the dying of her father, James Sanderson, a retired mining firm govt who died in 2018 after spending lower than a month at Bear Canyon Rehabilitation Heart in Albuquerque. Within the reminiscence care unit, Sanderson fell repeatedly, suffered medicine errors made by nursing dwelling employees, and developed a bowel obstruction and sepsis, in response to the lawsuit, filed in 2019. Pearson’s legal professionals mentioned he was not hospitalized till eight days after nurses observed he was vomiting brown mucus.
After the decide rejected Genesis’ request to pressure Pearson into arbitration, Genesis appealed. It took 2½ years earlier than an appeals courtroom affirmed the unique choice to let the case go ahead in courtroom, information present.
This previous Could, greater than 5 years after suing, Pearson reached a $500,000 settlement, with the primary cost required by November, in response to a replica of the settlement. Nothing was paid, in response to the chapter declare.
“It was so drawn out and for thus lengthy,” Pearson mentioned in an interview, calling Genesis’ chapter “despicable.”
Payouts postponed
Jennifer Foote, an Albuquerque legal professional who represents purchasers in a number of lawsuits towards Genesis, together with Pearson’s, mentioned the corporate ceaselessly filed appeals. “They didn’t normally win them on these points,” she mentioned, “and our sense was that they have been doing it as a delay tactic.”
Genesis began utilizing installment funds round 2018, mentioned Dusti Harvey, Foote’s regulation associate. “The funds would not begin for a number of months out,” Harvey mentioned. Foote mentioned Genesis’ legal professionals typically wished to time the funds to start out the month the trial within the case was scheduled to happen.
Households needed to wait even when comparatively small quantities of cash have been concerned, settlement agreements present. Genesis’ settlement agreements additionally included a confidentiality clause prohibiting dialogue of the incidents.
Genesis agreed to pay $42,000 in a November 2024 settlement, however the first cost was not due till 9 months later. It was not paid, in response to the chapter declare.
A $250,000 settlement signed in October 2023 didn’t begin paying out till the next September. When Genesis declared chapter — 21 months after the case was resolved — it nonetheless owed $100,000, in response to the household’s declare.
“We by no means came upon the reality”
Settling instances allowed Genesis to keep away from the expense and publicity of a trial, at which particulars of how its nursing properties functioned might need been revealed. In October 2020, Margarett Johnson, a retired faculty bus driver, fell out of her wheelchair at a Genesis nursing dwelling in Waldorf, Maryland, fracturing her jawbone, nostril, and neck, in response to a lawsuit introduced by her household. Johnson was despatched to a trauma heart and positioned on a ventilator. She died three months later, at age 76, from ventilator-associated pneumonia, the lawsuit mentioned.
“It appeared like she was hit by a truck,” Angelina Harley, certainly one of her daughters, mentioned in an interview. “I knew my mother was not going to return dwelling. I knew the Lord was not going to punish her extra.”
The corporate denied negligence and blamed the accident on Johnson’s jacket getting tangled within the wheel of her wheelchair, in response to the lawsuit. Harley and her sister Angela Swann have been doubtful.
“We by no means came upon the reality,” Harley mentioned. “They wished to settle out of courtroom.”
Angela Swann 
The corporate denied legal responsibility however agreed to a $950,000 settlement in October 2024. It by no means paid the ultimate $112,500 installment, in response to a letter Johnson’s 5 kids despatched to the chapter decide.
“If you happen to settle out of courtroom, you realize doggone nicely you probably did one thing flawed,” Harley mentioned.
Maddening judges
By summer season 2025, judges in some civil instances had run out of endurance.
Alma Brown, a retired day care supervisor and accordion instructor dwelling in a Genesis nursing dwelling in Clovis, New Mexico, suffered falls, infections, bedsores, and different neglect that hastened her dying in 2023, in response to her property’s lawsuit. In Santa Fe District Court docket, Decide Kathleen McGarry Ellenwood castigated Genesis after it didn’t pay $2 million of the $3 million settlement to Brown’s property or clarify the delay.
Genesis “clearly benefited by not having to go to trial,” McGarry Ellenwood mentioned in a single listening to, in response to a courtroom transcript. “They guarantee me that they don’t seem to be making an attempt to renege on their contract, however it definitely looks like they have not lived as much as what the discount was.”
Genesis declared chapter the day McGarry Ellenwood introduced she would impose greater than $100,000 in fines, plus $10,000 extra every day till the settlement was paid.
In Pennsylvania, Greg Hunt petitioned a decide to punish Genesis after it stopped funds of the $3.5 million settlement after the dying of his mom, Nancy, the resident with the gangrenous foot. She had spent eight months in 2019 at Brandywine Corridor, a Genesis facility in West Chester that was later bought and renamed.
In a submitting with the Frequent Pleas Court docket of Montgomery County, Genesis admitted it was in arrears however requested the decide for extra time, citing “unexpected and exigent monetary challenges.” Genesis mentioned look after sufferers at its nursing properties would endure if it needed to pay instantly.
Unswayed, Decide Richard Haaz in June ordered Genesis to pay up, together with punitive curiosity. However the chapter courtroom stayed that order. Genesis nonetheless owes $1.4 million of the $2 million it was speculated to pay, in response to Hunt’s declare. (The remainder of the $3.5 million settlement is meant to be paid by an insurer in January 2026.) Ian Norris, Hunt’s lawyer, declined to remark, citing confidentiality provisions within the settlement.
Court docket information point out Genesis legal professionals by no means disclosed in both case that it was getting ready to declare chapter.
“Chapter as a device”
Within the first 9 months of 2025, 10 different senior dwelling corporations with liabilities over $10 million entered Chapter 11 chapter, in response to Gibbins Advisors, a consulting agency.
Hamid Rafatjoo, a chapter lawyer representing nursing properties who shouldn’t be concerned within the Genesis chapter case, mentioned filings could enhance because the business has turn into costlier to run and sophistication motion lawsuits have turn into a fixture.
“Nursing properties get sued on a regular basis for all the things,” Rafatjoo mentioned. “Loads of operators wait too lengthy to make use of chapter as a device.”
On Dec. 1, Genesis introduced the outcomes of its public sale, saying it had elected to promote its property to a non-public fairness agency managed by Landau. In a courtroom submitting, Anthony, the legal professional for the non-public harm claimants, alleged the public sale was stacked in Landau’s favor regardless of an “objectively higher and better competing bid” from one other personal fairness investor that may have supplied more cash to collectors. Genesis mentioned in its assertion that Landau’s group had elevated its bid throughout the public sale.
Sen. Elizabeth Warren (D-Mass.) and two different senators final month requested the U.S. Trustee’s Workplace to intervene within the case, out of concern that “people who already personal or management Genesis are attempting to promote it to themselves, wiping away authorized and different creditor money owed within the course of.” Attorneys representing these answerable for the public sale didn’t reply to a request for remark.
Households of former Genesis residents mentioned they worry the capability to purge lawsuits by way of chapter emboldens nursing dwelling homeowners who present poor care.
Adria Malcolm for KFF Well being Information 
“They’ll file chapter once more,” mentioned Gabe Betancourt, whose spouse, Nellie, died after her keep at Uptown Rehabilitation Heart in Albuquerque. “And we are the ones that can pay for it, with our recollections, our lives.”
KFF Well being Information is a nationwide newsroom that produces in-depth journalism about well being points and is likely one of the core working applications at KFF — the impartial supply for well being coverage analysis, polling, and journalism.
