Crozer Hospitals to Close; Delco Dems Blame ‘For-Profit’ Healthcare
Crozer Health, the largest health system in Delaware County, is shutting down.
FTI Consulting, which had been managing the finances of Crozer parent company Prospect Medical Holdings, announced the decision Monday.
“As Court appointed receiver, we are disappointed an alternative resolution and sale could not be reached,” said an FTI spokesperson in a statement.
Prospect Chief Restructuring Officer Paul Rundell released a statement claiming the group didn’t want Chester Crozer and Taylor hospitals to shut down.
“Today, Prospect Medical Holdings made the extremely difficult decision to begin winding down operations across our Crozer Health facilities. The ambulatory surgery and imaging centers at Brinton Lake, Broomall, Haverford, and Media will remain open.
“PMH recognizes the impact this action will have on patients as well as team members. We’ve worked tirelessly with the Pennsylvania attorney general and other parties to do everything possible to prevent this outcome. Unfortunately, we were unable to reach a viable alternative. At this time, the focus at Crozer Health remains on seamlessly transitioning patients to other health facilities so that they can continue to receive the critical, uninterrupted care they require, and to support Crozer Health team members as they seek to identify other employment opportunities.”
The closure announcement ends months of waiting and negotiations on the future of the hospitals.
“Along with the Governor’s Office and other state and local leaders, we worked tirelessly to avoid this outcome,” said Brett Hambright, a Pennsylvania Office of Attorney General spokesperson.
Prospect declared bankruptcy in January. Attorneys said the Delaware Valley facilities needed to close because they cost too much to operate.
At times, it appeared a savior for the hospitals would appear, but no buyer emerged. Attorneys for FTI Consulting, Prospect’s debtors, Delaware County, and the Attorney General’s Office told a federal bankruptcy judge several times last month that things were looking up.
Potential buyers included a consortium featuring Delaware County and Penn Medicine as members.
Chester Crozer and Taylor hospitals received $46 million in total short-term funding from Pennsylvania and Delaware County taxpayers, plus the Foundation of Delaware County, to stay open in March.
Discussions took a turn for the worse in early April when Prospect’s debtors said the hospitals were running out of money. The debtors blamed the hospital system’s payroll schedule.
Penn Medicine and Delaware County chipped in an extra $6 million to keep the facilities open another six to 10 days on April 10.
Now that money has run out, and so has time for the hospitals.
“The heroic Crozer staff … deserved a better outcome,” said Hambright. “Unfortunately, despite the best efforts of our office, that resolution proved out of reach.”
The Attorney General’s Office solely blamed Prospect’s owners, Leonard Green & Partners, for the closure. The private equity firm was accused of prioritizing “their own wealth over the well-being of a community.”
Democrats in the Delaware County legislative delegation, led by Swarthmore state Sen. Tim Kearney and Speaker of the House Joanna McClinton, called the closure of the Crozer Health System “a devastating and disgraceful blow to our communities.” They blamed the shutdown on capitalism, “for-profit” healthcare, and proposed federal spending cuts on Medicaid and Medicare that have not been enacted.
“Private equity’s decimation of Crozer is an abomination – the corporate abuse that our hospitals went through should be criminally illegal,” they wrote, adding:
“As Crozer demonstrates, privatization and for-profit systems are the problem, not the solution. We need bold action for the public interest.”
