Health care sector bankruptcy filings are continuing in the third quarter after improving in the second quarter as more companies struggle to avoid high debt obligations and litigation.
The sector faced more bankruptcy filings in the last two years, with 79 cases in 2023 and 57 in 2024, after averaging about 42 bankruptcy filings each year from 2019 through 2022, according to Gibbins Advisors.
Health care sector bankruptcy trends:
- Bankruptcy filings 2024: 57.
- Bankruptcy filings 2023: 79.
- Bankruptcy filing annual average 2019-2022: 42.
The sector faced more bankruptcy filings in the last two years, with 79 cases in 2023 and 57 in 2024, after averaging about 42 bankruptcy filings each year from 2019 through 2022,
Senior care Chapter 11 filings reached a two-year high in the first quarter of 2025, but filings improved in the second quarter with a 50% decline to seven filings compared to 14 in the same period of 2024, Gibbins reported.
Related: Giant healthcare services provider files Chapter 11 bankruptcy
The third quarter, however, has already feature several large health care company bankruptcies and several smaller ones.
Huge healthcare companies filed for bankruptcy
Giant healthcare services provider ModivCare Inc. and 70 affiliates filed for a prearranged Chapter 11 bankruptcy on Aug. 20, 2025, seeking to reduce its $1.4 billion in debt and hand its assets to its lenders.
Medical device company LifeScan Global filed for Chapter 11 protection on July 15, 2025, seeking to reduce $1.27 billion in debt and hand its equity to its lenders.
Huge health care facilities operator Genesis Healthcare Inc. filed bankruptcy on July 9, 2025, seeking a sale of its assets to a stalking-horse bidder.
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Landmark Recovery to reorganize in bankruptcy
Finally, struggling healthcare provider Landmark Recovery of Colorado LLC, which operates addiction treatment facilities in Colorado Springs, Colo., and the Denver area, filed for Chapter 11 bankruptcy to reorganize its business.
The Colorado Springs-based healthcare company filed its petition in the U.S. Bankruptcy Court for the Middle District of Tennessee, listing $1 million to $10 million in assets and liabilities on Aug. 20.
Related: 37-year-old auto parts chain franchisee files for bankruptcy
The debtor's largest unsecured creditors include Sabra Healthcare Holdings III LLC, owed over $840,000; Scripps Media Group, owed over $459,000; and Maxim Healthcare Services, owed over $409,000.
The debtor's petition did not indicate a reason for filing for bankruptcy.
Arkansas Landmark affiliate also files for bankruptcy
Debtor affiliate Landmark Recovery of Arkansas LLC filed a Chapter 11 petition in the Middle District of Tennessee on the same day.
Landmark Recovery of Colorado is also affiliated with other Colorado facilities, including Sheridan Grove Recovery in Aurora, Colo., Praxis of Colorado Springs by Landmark Recovery, and Praxis Suboxone Clinic by Landmark Recovery, Landmark Recovery of Denver, and Landmark Recovery Suboxone Clinics, according to its petition.
Landmark Recovery of Colorado affiliates:
- Sheridan Grove Recovery in Aurora, Colo.
- Praxis of Colorado Springs by Landmark Recovery.
- Praxis Suboxone Clinic by Landmark Recovery.
- Landmark Recovery of Denver.
- Landmark Recovery Suboxone Clinics
Landmark Recovery had been a larger addiction treatment healthcare chain, but a review of the company's website reveals a large red banner across the top of the page, proclaiming: “Landmark Recovery has been sold, and all locations are under new local leadership.”
More bankruptcy:
- Unusual bar and restaurant chain files Chapter 7 bankruptcy
- Major healthcare company files Chapter 11 bankruptcy, seeks sale
- Home improvement retail supplier files for Chapter 11 bankruptcy
The website listed nine Landmark locations: three in Louisville, Ky., two in Colorado, two in Ohio, one in Arkansas, and one in Indiana. The website did not provide any other information other than phone numbers and addresses for each location.
Landmark Recovery affiliates faced lawsuits
Landmark Recovery affiliates have faced several lawsuits in recent years and entities in Ohio and Louisville in May reportedly settled overtime wage lawsuits for about $738,000, according to Law360.
Landmark Recovery of Louisville also faces a lawsuit filed against it in July 2025 over a failed sale transaction, Iowa Capital Dispatch reported.
Three Landmark facilities in Indiana were also closed by state officials in 2023.
