How Pennsylvania and Delaware County came up with $20 million to keep Crozer hospitals open
The money is being paid to an independent receiver, or temporary manager, who is overseeing Crozer's management and evaluating its financial condition.
Pennsylvania and Delaware County officials, faced with the imminent closures of financially struggling Crozer-Chester Medical Center and Taylor Hospital by the Crozer health system’s for-profit owner Prospect Medical Holdings, came up with $20 million this month to keep the facilities open.
The possibility of closure had loomed large ever since California-based Prospect filed for bankruptcy protection in January.
Newly disclosed details from state and county officials show where the money came from. The state provided $10.2 million, and $9.8 million came from the county. The money was paid to the temporary manager, called a receiver. FTI Consulting, which is acting as the receiver, officially started Feb. 14 and will be in place for 30 days, unless the arrangement is extended.
Most of the state’s contribution was an advance payment of supplemental Medicaid payments that go to hospitals that care for a large number of low-income patients. That accounted for $9.3 million — money that normally would be paid out close to the end of the state’s fiscal year in June.
Another $572,000 came from the Pennsylvania Department of Community and Economic Development’s Hospital and Health System Emergency Relief Fund. The final piece was $300,000 from insurer UnitedHealthcare, which had 10,288 Delaware County residents in its Medicaid plan in January.
The Delaware County contribution is coming from a block grant for mental health services. This is money that the federal government provides to states for distribution to counties for local services. The county will pay the money through two contracts, retroactively agreed to in January and this month.
The county’s funding breaks down as follows: A Jan. 8 contract covers the current fiscal year, which started July 1, and allows the county to pay up to $5.5 million for mental health crisis center services.
On Feb. 19, the council approved a contract with Crozer for the fiscal year that ended June 30, 2024. Officials said during a preliminary meeting the day before that turmoil at Crozer had made it impossible to get the contract done earlier.
Under the fiscal 2024, the county agreed to $6.6 million for services that had already been provided, but had not been properly invoiced by Prospect until recently.
Prospect did not respond to a request for comment about the invoicing problems.