Corizon Healthcare Bankruptcy Leaves Former Prisoners Wondering About Compensation

Corizon Healthcare Bankruptcy Leaves Former Prisoners Wondering About Compensation

Over 100 individuals who believe they received negligent or inadequate medical care from private medical contractor Corizon Healthcare while incarcerated are facing uncertainty regarding potential compensation in light of the company’s complicated bankruptcy. Corizon, which provided healthcare services in prisons and jails across the United States, transferred most of its debts to a newly created company called Tehum Care Services, which then filed for bankruptcy. Critics argue that this corporate restructuring, known as a “Texas Two-Step,” may allow Corizon to minimize its liability by operating under a new name, YesCare, a company that recently secured a contract worth over $1 billion in Alabama.

Tehum Care Services, the bankrupt new company resulting from the restructuring, owes over $82 million to more than 1,000 creditors, including former patients who were injured or neglected, former employees, hospitals, doctors’ offices, and cities. Court papers indicate that almost all of Corizon’s assets, valued at more than $170 million, were transferred to YesCare, which continues to provide healthcare services in prisons and jails. These actions have led to allegations of an attempt to hide assets and avoid paying debts.

The bankruptcy proceedings have put the lawsuits brought against Corizon by individuals on hold, leaving them uncertain about the compensation they may receive. These lawsuits include cases of medical negligence and misconduct, such as a man who had a sexual relationship with his Corizon mental health counselor while incarcerated and unable to give consent, and another man who suffered permanent brain and spinal damage due to delayed medical treatment. The bankruptcy also impacts former Corizon employees, with hundreds filing claims for unpaid compensation and benefits.

The bankruptcy maneuver has raised questions about whether Tehum Care Services is genuinely insolvent or is exploiting the bankruptcy system to evade financial obligations. A recent article by Business Insider revealed a group of individuals benefiting from the bankruptcy who are associated with YesCare and Tehum. These individuals have been accused of conducting a fraudulent scheme to avoid liabilities while enriching themselves.

As the bankruptcy proceedings continue, former prisoners and their families, as well as former Corizon employees, anxiously await the resolution of their claims and the potential compensation they may receive. The full details of the settlement to address the bankruptcy are not yet public.

Sources: The Marshall Project

– The Marshall Project

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