Genesis’ Bankruptcy Plan Means Negligence Victims Will Recover About 26 Cents on the Dollar

Albuquerque, New Mexico — The families who won negligence verdicts and wrongful death settlements against Genesis HealthCare just learned what their cases are worth under the company’s bankruptcy plan: roughly 26 cents on the dollar, at best.

A federal judge signed off on Genesis’ Chapter 11 liquidation plan Wednesday, clearing the way for the nearly $1 billion sale of its 175 nursing homes. More than $200 million in company assets will move into a liquidation trust to pay unsecured creditors — a group that includes patients and families holding pending settlements, jury awards and lawsuits tied to personal injuries, negligence and wrongful deaths. A creditors’ board will oversee the trust’s budget and distributions, and payments could start arriving within the next year or so.

For many families, the math is brutal.

Genesis operates 21 facilities in New Mexico and controls roughly a third of the state’s nursing home beds. Hundreds of personal injury and wrongful death claims are pending against the company in New Mexico alone. One in three of its facilities there holds the lowest one-star federal rating, compared with 24% of nursing homes statewide, according to local news reports. Santa Fe’s Casa Real facility isn’t rated at all — a reflection of its history of serious quality problems.

Attorneys who represent affected families said the outcome falls far short of accountability. “For the families we represent, the questions still remain: how much accountability there will be, when they will receive their compensation and whether residents will receive better care with the new company,” said Dusti Harvey, a partner at a local law firm that has brought dozens of cases against Genesis since 2005.

Her colleague Caela Baker went further. She described Genesis as an example of a broader pattern: companies that funnel money upstream to executives, run facilities short-staffed, then turn to bankruptcy once the lawsuits pile up.

“They’re letting injuries and deaths happen, and then once the lawsuits become overwhelming, they file for bankruptcy,” Baker said. “We saw it with Genesis.”

Genesis pushed back. A company spokesperson said its centers and employees will operate under the new owner with “a continued commitment to providing high-quality care,” and that there’s no interruption to patient and resident care.

The company filed for Chapter 11 protection in July 2025. Under the approved plan, all 175 homes in the sale will stay open while regulators review ownership transfers, with some operating under interim managers in the meantime.

Plaintiffs’ attorneys say the bankruptcy playbook is spreading across the industry: face the lawsuits, then restructure the liabilities away. For the families still waiting on Genesis, justice now arrives at about a quarter of its sticker price.