National — Late last week, YesCare, one of the nation's largest providers of correctional healthcare, filed for Chapter 11 bankruptcy for the second time in just three years, following a $307 million jury verdict for medical neglect last month. The filing is the latest in a wave of bankruptcies by major carceral healthcare contractors, including Wellpath, Armor Correctional Health, and YesCare's predecessor Corizon Health.
Bianca Tylek, Executive Director of Worth Rises, issued the following statement:
“Correctional healthcare provider YesCare was born out of the bankruptcy of its predecessor Corizon, and not yet three years old, YesCare is already filing for bankruptcy itself. Facing a $307 million jury verdict in Michigan for medical neglect, YesCare seeks to absolve itself of responsibility for the devastating harm it’s caused. The corporation’s repeated bankruptcies are the inevitable conclusion of a business model that prioritizes profit over human life.
“For decades, the correctional healthcare industry has raked in billions while denying incarcerated people care, resulting in constitutional violations, catastrophic health outcomes, including preventable deaths, and mountains of legal settlements. The providers in this industry depend on bankruptcy courts to then clear their balance sheets and get back to business as usual, with no intention to change its provision of care. They treat their patients as liabilities to be managed rather than human lives to be protected — and when their profit margins depend on denying life-saving care, lawsuits are a certainty, not a risk.
“The bottom line is that there is no corporate restructuring or financial engineering that can fix the problem in the correctional healthcare industry because this is not a balance sheet problem; this is a moral problem. Across the industry, corporations are abusing bankruptcy courts to escape accountability for injuries and deaths. As juries continue to issue major settlements, will bankruptcy courts continue to erase their will and let the industry get away with murder?”
Background
A wave of bankruptcies has swept through the correctional healthcare industry in recent years, as major contractors collapse under the weight of medical malpractice litigation and mounting liabilities:
Corizon Health: In 2023, the predecessor to YesCare, filed for bankruptcy after a divisional merger attempted to isolate litigation liabilities from revenue-generating contracts — a strategy that later faced significant legal challenges and failed. At the time, Corizon had roughly $1 billion in legal settlements, primarily from medical malpractice, and eventually agreed to a $75 million settlement — or pennies on the dollar. YesCare recently failed to meet payments, leaving families high and dry for the hundredth time.
Wellpath: The nation’s largest private provider of carceral healthcare filed for Chapter 11 in late 2024, citing an unmanageable volume of medical malpractice litigation and the inability to secure affordable third-party insurance.
Armor Correctional Health: Following a 2023 Chapter 11 filing, Armor moved to liquidate its assets in 2024. The firm's collapse was precipitated by a "litigation crisis" involving hundreds of lawsuits and a rare criminal conviction for falsifying medical records in Wisconsin.