The owners of four care homes in Pembrokeshire say they may close despite being a granted a judicial review into the fees they are paid.
The High Court agreed to the review but refused an immediate increase to the cash paid by the county council.
Now the owners say they are considering whether they can continue operating the homes that care for 86 people.
The council said it would continue discussions with the owners "because the issue needs to be resolved."
The four homes in question are Pen-coed in Saundersfoot, Langton Hall in Fishguard, Woodfield Care Home in Narberth and Woodland Lodge in Tenby.
On Tuesday, the owners went to the High Court in Cardiff seeking a judicial review of the fees they were paid by the council and an interim payment of an extra £90 a week per resident.
Judge Milwyn Jarman QC granted the judicial review which will take place on 14 December but refused a temporary increase in fees until then.
Care Forum Wales, acting on behalf of the owners, said they may now have to close.
Senior policy officer Barry Latham said: "The directors of the companies will now have to give careful consideration to the court's decision and decide whether they can continue or must plan for closure giving as much time as possible for the residents of the homes to be relocated.
"If closure of the homes is the only option available it is unlikely that many of the residents will be able to secure alternative suitable placements within Pembrokeshire.
"I would urge John Davies, the leader of Pembrokeshire council, and his colleagues to reconsider their position and work in partnership with these homes and the sector generally to ensure these vital services are sustained in the run-up to Christmas."
In a statement Pembrokeshire council said it was pleased that the application for an immediate temporary increase in fees was refused.
"The case will now proceed to a final hearing on 14 December this year at which we believe the council's position will be fully vindicated.
"In the meantime the county council will continue discussions with the care home owners because the issue needs to be resolved."