HARRISBURG, PA — An agreement reached on Sunday, March 9, has averted the imminent closure of Crozer Health, safeguarding healthcare access for thousands in southeastern Pennsylvania while efforts continue to establish a long-term restructuring plan.
The deal, finalized after more than six hours of negotiations, was facilitated by a Texas federal bankruptcy court judge and brought together key stakeholders, including Attorney General Dave Sunday, representatives from The Foundation for Delaware County, and leadership from Prospect Medical Holdings, the current owner of Crozer Health. Board members, Delaware County officials, and representatives from court-appointed receiver FTI Consulting also participated.
Attorney General Sunday emphasized the urgency of preserving vital healthcare services during the negotiations. “This agreement is a crucial step,” Sunday stated. “It reflects the dedication and sacrifices of all parties involved, ensuring that thousands of Pennsylvanians continue to receive essential medical care.”
Immediate funding from The Foundation for Delaware County played a pivotal role in addressing financial gaps that threatened the system’s operations. Frances Sheehan, President of the Foundation, expressed cautious optimism, saying, “While this agreement provides critical short-term relief, our hope is to secure a sustainable solution with the involvement of a nonprofit provider to ensure long-term stability.”
Crozer Health, which has faced financial instability tied to alleged mismanagement by Prospect Medical Holdings, has been the subject of significant legal and regulatory scrutiny. The Office of Attorney General has sought court intervention to hold Prospect accountable for failures stemming from its 2016 acquisition of Crozer-Keystone Health and has advocated for measures to stabilize the hospital system.
Though the immediate crisis has been averted, the path forward remains challenging. Attorney General Sunday reaffirmed his office’s ongoing commitment to resolving the systemic issues affecting Crozer Health, describing the health system as both an essential resource for residents and a critical economic driver for Delaware County.
With the system now under new interim management by FTI Consulting, stakeholders are working to develop a permanent plan that addresses the system’s financial obligations while prioritizing the needs of the community. The next phase of restructuring will be closely monitored by state and local leaders as well as community advocates committed to maintaining accessible and quality care for southeastern Pennsylvania.
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