Global Wound Care Medical Group: Chapter 11, Fraud, Shutdown

Global Wound Care Medical Group, the Los Angeles-based professional corporation that ran the nationwide wound care practice known as The Wound Pros, filed for Chapter 11 bankruptcy on October 21, 2024 and has since collapsed into a shell. The Global Wound Care Medical Group bankruptcy sits in the U.S. Bankruptcy Court for the Southern District of Texas in Houston as case number 4:24-bk-34908, before Judge Christopher M. Lopez.¹ As of mid-2026, the company has ceased all clinical operations, terminated nearly its entire workforce, is holding roughly $5.55 million in cash, and is negotiating a global settlement with the Department of Justice before an expected conversion to Chapter 7 liquidation.²

What Triggered the Bankruptcy

The immediate cause was a Medicare payment freeze. On September 11, 2024, the Centers for Medicare and Medicaid Services suspended the company’s Medicare payments after Qlarant, a Unified Program Integrity Contractor, cited “credible allegations of fraud related to five 2023 claims totaling $11,150.65.”³ Under Medicare rules, credible fraud allegations on even a handful of claims can trigger a full payment freeze.

The effect on Global Wound Care was severe. Medicare represented approximately 90 percent of the company’s revenue, and roughly $208 million in payments were suspended before the bankruptcy filing.² Without that revenue, the company could not pay Wound Pros Management Group, its affiliated management company, which was owed nearly $156 million in accumulated charges.⁴

The Chapter 11 Petition

Six weeks after the payment suspension, on October 21, 2024, Global Wound Care Medical Group filed for Chapter 11 protection. It listed total liabilities of $157.1 million, the overwhelming majority owed to Wound Pros Management Group.⁵

The debtor is one entity in a sprawling corporate group. Florida Division of Corporations records identify Dr. Owen B. Ellington as the Director and CEO of Global Wound Care Medical Group, which was incorporated in Florida in December 2023 with its principal address at 5901 West Century Boulevard, Suite 750, in Los Angeles.⁶ The practice operated alongside affiliated entities including Wound Pros Management Group, Wound Pros Enterprises LLC, Wound Pros Holdings P.C., and state-specific professional corporations in Georgia, Nevada, Tennessee, and Texas.⁷ At its peak, the practice treated over 2,000 wounds daily across more than 20 states.

The Underlying Fraud Investigation

The payment suspension is only the visible layer. The Department of Justice had been investigating the Wound Pros network for potential violations of the False Claims Act, the Anti-Kickback Statute, and the Stark Law before the bankruptcy filing.

In June 2024, the United States filed a petition in the U.S. District Court for the Eastern District of California to enforce Civil Investigative Demands against a dozen Wound Pros entities, including Global Wound Care Medical Group.⁸ Civil Investigative Demands are the DOJ’s pre-litigation discovery tool under the False Claims Act. The government sought patient-level data with 16 required fields per patient, details about software systems and auto-populated billing fields, compensation arrangements, organizational charts, and records of any internal complaints about billing practices or fraud.⁹

The enforcement petition was assigned to District Judge Daniel J. Calabretta and referred to Magistrate Judge Allison Claire. As of August 2025, the case remained active, with several filings sealed and a substitution of defense counsel entered in April 2025.⁷

How the Case Tried to Keep Operating

For the first year of the Chapter 11 case, the goal was to restore enough cash flow to keep treating patients. On December 19, 2024, the bankruptcy court approved a stipulation between the debtor, the DOJ, and HHS. Under the agreement, CMS would release 75 percent of post-petition Medicare claims to the company and retain the remaining 25 percent. The released funds were subject to a first-priority government lien on a segregated account, and the government was granted superpriority administrative claim status and setoff rights.²

The company retained Ankura Consulting Group as financial and restructuring advisor and Dentons US LLP as counsel for the DOJ settlement talks. Isaac Lee was appointed Chief Restructuring Officer in late November 2024 and later replaced by Louis E. Robichaux IV.¹⁰

By October 2025, the 75 percent arrangement was not enough. The company reported it was owed $27.2 million in outstanding Medicare reimbursements and faced a severe liquidity crisis.⁵ On October 29, 2025, Judge Lopez approved an interim order authorizing a $10.7 million debtor-in-possession loan from East West Bank, with Wound Pros Management Group as guarantor. The loan carried a 12 percent interest rate, a 4 percent commitment fee, a 4 percent exit fee, and a maturity date 120 days after the interim order or upon certain milestones such as a sale, plan confirmation, or conversion.²

Why the Company Shut Down

The DIP loan bought weeks, not survival. In late 2025, CMS finalized a new rule, effective January 1, 2026, that reclassified most skin substitutes and drastically reduced Medicare reimbursement rates. The new payment structure cut reimbursements by roughly 90 percent for the types of procedures at the core of Global Wound Care’s business.²

On December 12, 2025, Global Wound Care ceased all clinical operations, citing “financial challenges and regulatory modifications.”³ At shutdown, the company employed 284 staff members and 49 independent medical directors, and it had been managing over 160,000 annual patient encounters in homes, hospices, and skilled nursing facilities across more than 20 states. All active patients were transferred to new providers.

On April 6, 2026, the court approved procedures for handling and disposing of the company’s patient records, including a 365-day waiting period during which HHS and the DOJ may request possession of unclaimed records.²

Where the Case Stands Now

The Chapter 11 case remains active on the docket, but the company exists only on paper. Global Wound Care reported just one remaining full-time employee as of its March 31, 2026 monthly operating report, with roughly $5.55 million in cash on hand.²

The debtor’s counsel has indicated that a conversion to Chapter 7 liquidation is expected, but only after a global settlement with the DOJ is finalized. That settlement has not been reached. To facilitate continued negotiations, the parties agreed in March 2026 to extend the U.S. government’s proof-of-claim deadline to August 1, 2026.² No plan of reorganization or disclosure statement has been filed, and the docket’s most recent filing is dated May 26, 2026.¹

What remains to be determined is the size of the government’s claim, the terms of any settlement, and what unsecured creditors ultimately recover from the estate.

Industry Context

Global Wound Care’s collapse is not isolated. The DOJ has made the wound care industry a top enforcement priority. In November 2025, Vohra Wound Physicians Management LLC and its owner, Dr. Ameet Vohra, agreed to pay $45 million to settle False Claims Act allegations tied to upcoded surgical debridement billing and software configured to bill every procedure at the highest possible rate. Vohra also entered a five-year Corporate Integrity Agreement with the HHS Office of Inspector General.¹¹ In a larger case, Alexandra Gehrke and Jeffrey King, owners of Apex Medical LLC, were sentenced to 15.5 and 14 years in prison, respectively, for a $1.2 billion scheme involving medically unnecessary wound grafts on elderly and hospice patients, and agreed to pay a combined $309 million to resolve civil False Claims Act liability.¹²

Regulation has moved alongside enforcement. Medicare spending on skin substitutes rose from under $400 million in 2022 to over $10 billion in 2024, prompting the January 2026 CMS rule. CMS estimated the rule would reduce program spending by $19.6 billion in 2026 alone.¹² In April 2026, the DOJ launched a “West Coast Strike Force” specifically targeting health care fraud in Arizona, Nevada, and Northern California, and a joint DOJ-HHS working group formed in July 2025 is focused on manipulation of electronic health records to drive inappropriate billing.

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Inforuptcy. Global Wound Care Medical Group Bankruptcy Case
2
Elevenflo. Global Wound Care Medical Group, A Professional Corporation
3
Elevenflo. Global Wound Care Medical Group Case Overview
4
Law360. LA-Based Wound Group Hits Ch. 11 After Medicare Pay Pause
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Law360. Global Wound Care Flags Medicare Delay Amid Shutdown
6
Florida Division of Corporations. Global Wound Care Medical Group Entity Detail
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CourtListener. United States v. Wound Pros Management Group
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GovInfo. United States v. Wound Pros Management Group, Case 24-263
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Compliance and Ethics. Anatomy of a Civil Investigative Demand
10
Verita Global. Global Wound Care Restructuring Documentation
11
U.S. Department of Justice. Vohra Wound Physicians and Its Owner Agree to Pay $45M to Settle Fraud Allegations
12
U.S. Department of Justice. Wound Graft Company Owners Sentenced for $1.2B Health Care Fraud