Since the start of the Covid-19 pandemic, senior living facility operators have encountered significant challenges that pushed many towards financial instability. This has resulted in some filing for bankruptcy and occasionally closing their doors forever.
In 2020, senior care homes faced immense challenges due to the pandemic, with approximately 40% of their residents contracting or possibly having contracted COVID-19 that year. The U.S. Department of Health and Human Services Office of the Inspector General stated that over 1,300 facilities experienced infection rates reaching at least 75% during peak surges.
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One of the primary issues faced by elderly care facilities was the challenge with staffing, due to high infection rates causing substantial employee turnover along with hurdles in recruiting, orienting, and updating the skills of new personnel.
Related: Leading automotive components manufacturer shifts from Chapter 11 bankruptcy to liquidation
As economic challenges escalated following the onset of the pandemic, rising inflation affected senior care facilities by increasing their operating costs for products, supplies, and staff salaries. Additionally, over the past three years, higher interest rates have driven up the expense associated with loans for these facility managers.
Senior care businesses faced insufficient reimbursement from Medicare, Medicaid, and insurance policies, resulting in financial shortages.
Between 2021 and 2024, a total of 51 senior care businesses declared bankruptcy, with numbers including 13 filings in 2021, 12 in 2022, 15 in 2023, and 11 in 2024, as reported by Gibbins Advisors.
In 2023, among those who declaredChapter 11 bankruptcy were Evangelical Retirement Homes of Greater Chicago, which initiated this process in June with plans to auction off their properties. Another entity was Windsor Terrace Health, managing 32 care facilities in California along with three more in Arizona, declaring bankruptcy in August of the same year.
Companies operating senior care facilities have filed for bankruptcy.
In 2024, several senior care providers encountered financial difficulties and sought bankruptcy protection. Among them was Magnolia Senior Living, which operates four locations in Georgia; they initiatedChapter 11 proceedings on March 19, 2024.
A day after the previous announcement, Petersen Health Care, a major operator of around 100 nursing homes, assisted-living centers, and long-term care facilities across Illinois, Iowa, and Missouri, declaredChapter 11bankruptcyonMarch 20, 2024.
Pacific Senior Living plans to dissolve its assets.
Now, the large national network of eldercare facilities, Pacific Senior Living LLC, managing approximately 93 care residences across the country, declared bankruptcy under Chapter 7 on March 24, 2025. Some locations may be forced to remove their current occupants and shut down as a result.
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The residents at Pacifica Senior Living’s Santa Clarita Hills Senior Living in Newhall, California, learned in late February that they needed to relocate from the 88-unit complex as it was scheduled to shut down on May 1st, as reported by The Signal.
More bankruptcies:
- Well-known restaurant and bar franchise initiates Chapter 11 bankruptcy proceedings
- Well-known footwear retailer files for Chapter 11 bankruptcy protection
- An award-winning cosmetic company has filed for Chapter 11 bankruptcy.
Pacific Senior Living has encountered legal challenges after settling a lawsuit in 2024 for $2.5 million related to their Healdsburg Senior Living facility located in Healdsburg, California, according to reports from the Santa Rosa Press Democrat.
Based in San Diego, the debtor reported asset values ranging from $100,000 to as much as $50 million in debt when they submitted their bankruptcy filing with the U.S. Bankruptcy Court for the Southern District of California located in San Diego.
Founded in 1978, Pacific Senior Living manages various types of care facilities including independent living, assisted living, memory care, respite care, skilled nursing, and adult day care centers. The monthly fees for their services vary; they charge between $1,795 and $7,500 for assisted-living care, $2,500 to $7,200 for memory care, and $1,995 to $6,695 for independent-living accommodations, as reported by Seniorly.com.
Connected: Yet another well-known restaurant franchise has filed for Chapter 11 bankruptcy.