Bankruptcy is Litigation

140.2.1 - Bankruptcy is Litigation (Rev. 13825; Issued: 06-11-26; Effective:07-13-26; Implementation: 07-13-26) An individual or company declares bankruptcy by filing a petition for bankruptcy in a United States Bankruptcy Court. The Bankruptcy Court then opens a bankruptcy case. The Bankruptcy Court closely monitors the affairs of the individual or company (the debtor) including the creditors' treatment of the debtor. Bankruptcy may appear to be "business as usual" for a debtor, but it is not. Upon receipt of a bankruptcy notice, Contractors must place the provider in a bankruptcy status in HIGLAS and refer the case to the CMS Office. Contractors should not take any further action against a debtor until they consult the servicing CMS Office who will consult with the CMS Counsel assigned the bankruptcy. Do not share any information about bankruptcy strategies or activities with the bankrupt provider.