Genesis Healthcare has secured a $150 million settlement to exit Chapter 11 bankruptcy protection in Texas. The deal eliminates nearly $431 million in claims and secures critical creditor support for the company's reorganisation plan. Genesis, one of the largest nursing home operators in the United States, filed for bankruptcy in March 2026 after facing financial pressures including declining occupancy rates during the COVID-19 pandemic, rising labour costs, and increased regulatory expenses. Under the settlement terms, major creditors have agreed to support the exit plan whilst unsecured claims from vendors and landlords will be largely resolved. Genesis will retain key assets and facilities, ensuring continuity of care for residents. The company could emerge from bankruptcy protection by autumn 2026 if court approval proceeds as scheduled.

Genesis and its ACO accuse former execs of stealing trade secrets, participants. August 27, 2026 Genesis HealthCare and its accountable care organization are suing a group of former executives, alleging they stole trade secrets, client information and financial models to fuel the "rapid ascent" of a competitor they formed. LTC ACO, which was the nation's first plan solely serving nursing home and assisted living residents, became a performance juggernaut for Genesis after its 2016 launch. Through 2024, it had generated more than $198 million in total Medicare savings and earned about $140 million in performance payments. Early in its bankruptcy case, Genesis cleared the way for the ACO to continue operating and distribute payments to qualified plan participants in accordance with Medicare Shared Savings Program rules. Now, more than a year into Chapter 11, Genesis is accusing LTC ACO's former acting president and four other high-ranking staff members of taking advantage of the larger company's bankruptcy to spread disinformation for their own gain. This is the latest filing in which new leaders of the Genesis brands have formally accused past insiders of using the once-mighty company to their own advantage. In Tuesday's complaint, Genesis accused Kristen Krzyzewski of retaining "significant volumes of LTC ACO's confidential information" and recruiting former staff members - including some with non-compete clauses - to help launch her own plan, operating as True LTC. Reached by McKnight's Long-Term Care News Wednesday, Krzyzewski shared a statement saying True LTC "takes its legal and contractual obligations seriously." "True LTC disputes the allegations and intends to defend its position through the legal process," the statement said. "Because the matter is pending before the court, we have no further comment at this time." Rapid ascent. The lawsuit said Krzyzewski resigned in February, formed True Holdings four days later and publicly unveiled her ACO this summer. "True's sudden emergence was possible only because the Individual Defendants' theft of LTC ACO's valuable trade secrets facilitated its rapid ascent, letting True skip the time, effort, and resources that LTC ACO invested to develop its own business," Genesis attorneys said this week. "Defendants wasted no time putting the Debtors' valuable assets to use. Defendants used LTC ACO's trade secrets in soliciting several provider groups, including LTC ACO's largest client, to leave LTC ACO and join True." Among True tactics outlined in the complaint are using terms that mirror or undercut LTC ACO's own operating agreements and spreading false "fear, uncertainty and doubt about LTC ACO's ability to pay the provider groups under the terms of their existing agreements while in bankruptcy." Among exhibits included with the lawsuit are a cease-and-desist letter sent to True and another from LTC ACO and Genesis buyer 101 W. State Street underscoring the plan's approval to pay shared savings moving forward. This isn't the first time during the bankruptcy proceedings that Genesis has gone after former insiders or executives. Early in the year, the company accused lenders Wax Dynasty Partners and MAO 22322 and their owners David Gefner and Joel Landau of buying debts to create a future claim, even though a landlord had twice considered forgiving that debt. That adversarial case was included as part of a broader settlement this month. In June, the company also accused Landau and then-CFO Jonathan Kirschner of "looting" that led to $50 million in losses. 'Point of no return' In this latest case, the losses are yet to be fully realized, but Genesis is seeking an injunction against True saying its "scheme is nearing the point of no return." Its initial participant list sent to CMS this month listed several current LTC ACO provider participants. CMS requires such participant overlaps to be resolved by Sept. 8, 2026. "If True's unlawful conduct succeeds in diverting these providers, LTC ACO will lose the providers, the Medicare beneficiaries associated with them, and the resulting economic value for the entire 2027 performance year," attorneys wrote. "And if any overlap remains unresolved after September 8, CMS may deny the providers' participation in both ACOs for 2027 - even if a provider ultimately chooses to remain with LTC ACO." Genesis and LTC ACO are also seeking possible damages.