Former Alabama Prison Healthcare Contractor YesCare Files for Bankruptcy

May 11, 2026 - MONTGOMERY, Ala. - YesCare, the troubled former medical provider for Alabama's prison system, has filed for bankruptcy after months of financial instability, unpaid wages, and the unraveling of its billion‑dollar contract with the Alabama Department of Corrections (ADOC).

The filing, submitted late last week, lists as much as $500 million in liabilities and acknowledges $9.7 million in unpaid wages owed to employees - a shortfall that had already caused delayed paychecks and deepened staffing problems inside state prisons.

A Contract That Fell Apart

YesCare - previously known as Corizon Health - secured a $1 billion contract in 2023 to deliver medical care across Alabama's correctional facilities. But by early 2026, ADOC officials publicly confirmed the company was failing to meet payroll and struggling to carry out its responsibilities, prompting the state to begin steps toward terminating the agreement.

The company's financial collapse quickly spilled into the courts. A Birmingham law firm representing YesCare in multiple cases asked to withdraw, telling a federal judge the company had not paid its legal bills since January and lacked the resources to continue its defense.

Lawsuits and Ongoing Care Concerns

YesCare is facing a series of lawsuits from incarcerated individuals and former employees, including:

A discrimination complaint from a former worker who says she was fired after reporting age‑based harassment.

A civil‑rights lawsuit from an inmate who alleges he was beaten by corrections officers at Ventress Correctional Facility in 2024.

Advocacy groups say the bankruptcy highlights long‑standing weaknesses in Alabama's privatized prison healthcare model. Alabama Appleseed, which has repeatedly documented failures in correctional medical care, noted that YesCare's financial instability was evident from the beginning of its contract.

Impact on an Already Strained Prison System

Alabama's prisons - among the most overcrowded and violent in the country - depend heavily on outside medical contractors. With YesCare's collapse, the state faces renewed uncertainty about how to provide constitutionally required healthcare to more than 21,000 incarcerated people.

Advocates warn the bankruptcy could worsen treatment delays, deepen staffing shortages, and disrupt continuity of care - problems already well‑documented in the system.

What Happens Next

ADOC has not yet named a permanent replacement provider. The bankruptcy process will determine how - or if - former employees, vendors, and patients owed services or compensation will be repaid.

For Alabama lawmakers, the crisis adds fresh urgency to address the state's long‑standing prison healthcare challenges, which continue to draw scrutiny from federal courts and civil‑rights organizations.