Crozer Health’s Delaware County hospitals got a reprieve, but officials are mum on details

A bankruptcy hearing Tuesday morning in Dallas is expected to reveal details of the weekend deal that provided short-term funding to prevent an abrupt closure of Delaware County’s Crozer-Chester Medical Center and Taylor Hospital.

The Foundation for Delaware County agreed Sunday to provide an undisclosed amount of money to keep Crozer from closing as soon as this week, according to a joint statement from the Pennsylvania Attorney General’s Office and the foundation, issued after a six-hour meeting in Harrisburg. The foundation was created to support health needs in the community as part of the health system’s 2016 acquisition by Prospect Medical Holdings, a for-profit based in California.

The statement said the short-term funding would “keep Crozer Health open for the immediate future while permanent restructuring of the system is solidified,” but it did not specify for how long.

At a bankruptcy hearing last week, Crozer’s bankrupt owner, Prospect Medical Holdings, said it would no longer pay the 3,200 doctors, nurses, and others who work for Delaware County’s largest health-care provider past this Friday.

This is the second time an infusion of cash forestalled Prospect’s closure of Delaware County’s largest health system, which has a vital safety-net function in an area that doesn’t have easily accessible alternatives.

Last month, Delaware County and the state agreed to provide $20 million that was supposed to keep Crozer open for 30 days while officials worked on clearing a path for a transition of Crozer to a new nonprofit operator.

State and local officials haven’t shared any evidence of progress toward that goal, which would require a new operator to take on the significant financial liabilities that Crozer has accumulated under Prospect.

The Foundation for Delaware County received $55 million from Prospect’s acquisition of the former nonprofit Crozer-Keystone Health System, but only after suing Prospect to force the company to pay what it owned under the sale agreement. As what is called a nonprofit conversion foundation, the independent organization’s purpose is to preserve charitable assets and to serve the health and well-being of local residents.

But last week, after Prospect said in court that it was starting the closure process, the foundation came under intense pressure. Gov. Josh Shapiro, other local elected officials, the Crozer nurses’ union, and even the bankruptcy judge urged it to provide money to keep Crozer open beyond March 14.

The governor’s office and the AG’s office did not answer questions from The Inquirer Sunday about whether officials had also tried to get money for Crozer from Sam Lee and David Topper, two Prospect owners and executives who collected $160 million in dividends funded by debt that was loaded onto Prospect hospitals, including those in Delaware County.

Prospect’s financial management has impacted patient care, according to a letter a dozen of Crozer’s chief medical residents sent Friday to U.S. Bankruptcy Judge Stacey Jernigan on behalf of the health system’s 135 doctors-in-training.

“We watched our colleagues leave when the surgical residency was dissolved, had inconsistent supplies of drinking water in certain offices, witnessed ceiling tiles collapsing in outdated offices, and spent hours making calls to get results on even urgent radiology studies,” according to the letter from chiefs of family medicine, internal medicine, emergency medicine, obstetrics-gynecology, and psychiatry.

At a state legislative hearing Monday at Neumann University in Aston, Joyann Kroser, president of Crozer’s medical staff and a gastroenterologist, told elected officials on the Pennsylvania Senate Democratic Policy Committee about the diminished resources at Crozer since Prospect took over.

“We used to be at least 10 physicians, and now we have three,” Kroser said of the Crozer gastroenterology group.

Prospect also has not consistently invested in needed equipment, said Kroser, who works primarily in Crozer’s Brinton Lakes outpatient facility. “We’re working with equipment that is at least two generations behind in some facilities,” she said.