Nearly three dozen Preferred Care Group facilities file for bankruptcy

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The facilities filed for Chapter 11 bankruptcy on Monday.
The facilities filed for Chapter 11 bankruptcy on Monday.

Thirty-three Preferred Care Group-affiliated nursing homes filed for bankruptcy on Monday, citing costly ongoing negligence and personal injury litigation against the provider.

Preferred Care, which has headquarters in Plano, TX, and was ranked last year as the twelfth largest nursing facility company in the United States, is currently defending itself against 163 lawsuits, according to court documents. Of those, 97 are pending in Kentucky, while another 27 are pending in New Mexico.

“The future costs, expenses and potential exposure associated with defending the pending litigation has left the Debtors with limited resources,” one court filing reads.

Additionally, a Preferred facility in Kentucky was ordered in October to pay $28.5 million in damages in a personal injury case.

By filing for Chapter 11 bankruptcy, the facilities will be able to take “a breathing spell” and stay open while the provider works on restructuring, the company said. Along with Preferred Care Group, lessee Preferred Care Inc., and non-clinical managers Preferred Care Partners Management Group LP and Kentucky Partners Management LLC also filed for bankruptcy this week, according to Reuters.

As of 2016 Preferred Care operated 107 total facilities in 12 different states. The provider has made headlines in its legal battle with New Mexico Attorney General Hector Balderas, who is taking the company to court in a case expected to be heard next spring.