Delco hospital closures won’t be the last if for-profit firms are allowed to strip-mine healthcare with impunity | Editorial
It is not hyperbole to point out that some people may die because of the increased distance required to get medical care — especially in an emergency.
The closing of Crozer-Chester Medical Center is a travesty that will ultimately harm Delaware County residents — all while the private equity firm that lined its pockets as it ran the venerable hospital into the ground walks away.
Make no mistake, the expected closure Friday of Crozer-Chester will devastate the surrounding community.
Delaware County will lose its largest teaching hospital, primary trauma care facility, and its only burn treatment center. Taylor Hospital, a separate 107-bed acute care facility in Ridley Park owned by the same private equity firm, closed on Saturday.
More than 2,600 employees will lose their jobs. Tens of thousands of patients will have to travel farther to seek treatment, while many vulnerable residents without cars may forgo basic care. It is not hyperbole to point out that some people may die because of the increased distance required to get help — especially in an emergency.
On average, Crozer admitted 19,000 patients and treated 53,000 emergency room patients every year. Another 1,700 babies were delivered.
Crozer is just the latest for-profit hospital to close in Pennsylvania. In the past year, three for-profit hospitals and 11 nursing homes either closed or went bankrupt.
There were efforts to save Crozer, which traces its roots back to 1893.
The state, county, and a nonprofit foundation funded largely by the sale of Crozer and charged with supporting the health of Delaware County residents, provided a combined $50 million to keep the hospital running.
Penn Medicine provided another $5 million, as Gov. Josh Shapiro’s office, local elected officials, and area healthcare providers had numerous meetings in search of a buyer or long-term solution to keep the hospital operating.
In the end, the blame for the demise of Crozer and Taylor Hospital rests squarely on Prospect Medical Holdings, a for-profit healthcare company owned by the California-based private equity firm Leonard Green & Partners.
Prospect purchased Crozer in 2016. The company then engaged in years of mismanagement and neglect, according to a 2024 lawsuit filed by then-Attorney General Michelle Henry.
The shoddy operations resulted in the closing of Delaware County Memorial Hospital and Springfield Hospital in 2022. Along the way, the company diverted millions to private investors and set up a dubious real estate leaseback arrangement that cost the hospital an additional $35 million a year, according to the suit.
As Crozer spiraled into bankruptcy, the private equity investors got rich, a U.S. Senate report found. A separate 2020 report by ProPublica found that Prospect Medical’s private equity investors pocketed $400 million in dividends and fees over several years, while the CEO made $128 million.
State lawmakers from Delaware County called on Attorney General Dave Sunday to petition the bankruptcy court to claw back the money that was used to keep Crozer afloat. The lawmakers asked Sunday to open a criminal investigation into Prospect’s current and former owners.
Sunday, a York County Republican who was elected in November, sent a meekly worded letter to the Delaware County delegation that said the next legal phase was “seeking relief” for the harms caused by the closure. He said he would pursue an investigation “if a legal tool is available.”
Sunday added that he was “praying” for the elected officials and their constituents.
A vital resource that has been part of the fabric of Delaware County for more than a century has imploded. Jobs have been lost, and lives are at stake. Possible misdeeds and mismanagement appear to be the cause.
Taxpayers in Delaware County need more than prayers from the state’s top law enforcement official.
Going forward, elected officials and area healthcare providers should continue to meet and explore ways to bring back Crozer.
Lawmakers in Harrisburg also need to take substantive steps to stop private equity firms from strip-mining hospitals, nursing homes, and other healthcare facilities. During his recent budget address, Shapiro called for more oversight and transparency of for-profit firms that own healthcare facilities.
He explained the harm caused by many private equity firms in a nutshell: “They buy up hospitals and healthcare facilities, line their pockets by stripping money and resources from those facilities, and then they compromise care. Then in many cases, they skip town, leaving taxpayers holding the bag, and communities without the care and services they need.”
Crozer is the latest victim. Until lawmakers act, it will not be the last.