Senior Housing Remains A Top Source Of Healthcare Bankruptcies Even As Filings Fall

The number of health care bankruptcy filings is falling in 2025, including in senior housing and care. But the industry still represents a top source for such bankruptcy filings since 2019.

Health care bankruptcy filings are on track to decline 16% in 2025 versus 2024, with 48 filings expected this year compared to the 57 bankruptcies filed in 2024. Gibbins Advisors in the second quarter of 2025 noted a “sharp slowdown” in bankruptcies, amounting to just seven cases in all of health care and representing the lowest quarterly total in three years.

While the senior housing and care sector saw seven bankruptcies in the first quarter of the year, in the second quarter of 2025, the sector recorded just one bankruptcy filing. All told, the senior housing and care segment is on track for 16 bankruptcy filings in 2025, according to the report.

Recent senior care bankruptcies include Genesis HealthCare’s Ch. 11 bankruptcy filing in July. The operator has more than 200 facilities nationwide, and about 15 are assisted living communities.

“We were surprised to see the number of healthcare bankruptcy filings dip in Q2 2025, after two quarters of elevated activity, but unfortunately it is not a reason for optimism,” Ronald Winters, Principal at Gibbins Advisors, said in a press release. “The impacts of recent federal legislation will be felt from as early as 2026, and providers without strong balance sheets will quickly feel the pinch.”

The decline in healthcare bankruptcies in the second quarter of 2025 “was driven by fewer large cases with liabilities exceeding $100 million,” the report from Gibbins Advisors reads. On the other hand, “middle-market” cases totaling $10 million to $100 million in liabilities “are on pace to match 2024’s 34 total filings.”

Despite the relatively better quarter, senior care, along with pharmaceuticals, remains a top source for health care bankruptcies since 2019. Since then, senior housing and care companies have represented 23.9% of all healthcare bankruptcies, only slightly below pharmaceutical companies, which accounted for 24.5% in that time.

A variety of forces, from pressure from payers to stubborn interest rates and Medicaid funding cuts impacting M&A, still poses risks for health care providers, senior housing included. Labor costs are rising and workforce shortages are persistent while “elevated supply expenses, amplified by tariff-driven inflation, continue to pressure healthcare margins, with rural and standalone providers facing the most acute challenges,” the report reads.

Meanwhile, “care delivery continues to shift out of hospital or skilled nursing facilities to outpatient/community/ home-based settings,” the report’s authors wrote. Gibbins Advisors estimated $50 billion of revenue will shift from hospitals to freestanding sites in the coming years.

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