Dive Brief:
- Prospect Medical Holdings has tentative deals to sell two of its shuttered hospitals in Pennsylvania — Chester Medical Center and Springfield Hospital — for a combined $13 million, according to documents filed to bankruptcy court last week.
- Chariot Allaire Partners has offered $10 million for Crozer-Chester Medical Center, while Restorative Health Foundation and Syan Investments together have offered $3 million for Springfield Hospital.
- Closing the deals would allow Prospect to finally rid its hands of failed Crozer Health, following years of conflict with state regulators over its management practices and failed sales attempts. Crozer fully shuttered this spring.
Dive Insight:
Prospect Medical Holdings purchased Crozer, a then four-hospital health system, for $300 million in 2016 and pledged to keep the facilities open for 10 years. Instead, over Prospect’s nine-year tenure, the for-profit health system closed all four hospitals, each time pinning the decision on financial hardship.
Prospect first closed Delaware County Memorial Hospital and ended inpatient care at Springfield Hospital in 2022. The reductions in services prompted a lawsuit from former state attorney general Michelle Henry in 2024.
When Prospect filed for bankruptcy this winter, it closed Crozer-Chester Medical Center and Taylor Hospital soon after, telling the court it had run out of cash to keep the lights on.
Closing Crozer Health left Delaware County in a state of emergency, as it abruptly upended healthcare access, including the availability of emergency services, and left thousands without jobs.
Still, Prospect owned, and needed to sell, the underlying real estate. Prospect sold Delaware County Memorial Hospital to the Upper Darby School District in August, and Taylor Hospital to KQT Aikens in September.
The health system initiated an auction process for its other two hospitals last month, setting a $7 million floor price for Crozer-Chester and a $3 million floor price for Springfield.
Parties in Prospect’s bankruptcy case have until Monday to object to the proposed sales terms. U.S. Bankruptcy Judge Stacey Jernigan, who is overseeing Prospect’s bankruptcy case, has approved Prospect to abandon the two hospitals if Prospect cannot find a buyer.
