Senior Care Policy Brief: Bankruptcy as a Business Strategy

The Senior Care Policy Briefing covers important long-term care issues by highlighting policy updates, news reports, and academic research.

Read the full Senior Care Policy Briefing below or download here.

December 15, 2025.

The Centers for Medicare & Medicaid Services (CMS) has issued an interim final rule rescinding the main components of the Biden Administration’s minimum staffing standards for nursing homes, including required minimum care hours per resident and 24/7 registered nurse coverage. Read LTCCC’s statement.

Genesis HealthCare – once the nation’s largest nursing home chains – filed for Chapter 11 bankruptcy in July 2025, citing more than $2 billion in debt and mounting malpractice and wrongful death lawsuits. In early December, the company reported that CPE 88988 LLC – an affiliate tied to Genesis’s private-equity (PE) ownership group – submitted the highest bid at its bankruptcy auction for all or substantially all of its assets, raising renewed alarms about the role of PE in the nursing home sector.
- A letter submitted to the bankruptcy court underscored these concerns, noting: “This precarious situation appears to have been the result of years of private equity looting of Genesis, including by JER Partners, and, most recently, by Mr. Landau’s ReGen Healthcare… We are further concerned that Genesis and Mr. Landau may be using the bankruptcy system to wipe away Genesis’s debt and claims to victims by selling the company at a discount to insiders.”
- However, as of December 15, the sale remains unresolved. A federal bankruptcy judge paused approval and demanded a mathematical comparison of bids, expressing concern about whether the auction was conducted fairly and whether the proposed insider-linked sale serves the interests of creditors and claimants.

- Genesis’s financial collapse reflects broader industry dynamics in which PE and aggressive financial tactics can drain resources from facilities, degrade care, and leave residents bearing the cost.
- A KFF Health News investigation by Jordan Rau provides a stark example of how this plays out in practice: hundreds of families who reached settlements with Genesis over resident injuries and deaths – including multi-million-dollar agreements – have seen those payouts delayed indefinitely or left unpaid as the company moves through bankruptcy.

A new report from the New Jersey Office of the State Comptroller finds that owners of two South Jersey nursing homes diverted more than $92 million in Medicaid funds to themselves and related companies while intentionally understaffing the facilities.
- According to the report, residents were routinely left in soiled conditions, denied timely pain relief and medications, exposed to preventable harm including sexual assault, and even suffered fatal neglect, such as a resident who died after being fed solid food despite a puréed-only order.
The owners, Daryl Hagler and Kenneth Rozenberg, have a history of serious allegations of abject neglect and fraud in the pursuit of higher nursing home profits, including through their Centers Health Care chain.

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