Dive Brief:
Crozer Health CEO Tony Esposito will step down on Friday, a spokesperson confirmed to Healthcare Dive. His departure comes as the four-hospital health system faces an uncertain future — including possible closure.
Crozer’s parent company, Prospect Medical Holdings, has unsuccessfully tried to sell the system for months. Prospect filed for bankruptcy in January and has said it lacks the funds to keep Crozer facilities open.
A spokesperson for Crozer declined to share why Esposito is leaving his post now. Greg Williams, the current president of Prospect Medical Holdings’ East Coast operations, will assume the role of interim CEO upon his departure.
Dive Insight:
The changing of the guard at Crozer is yet another sign of turbulence at the Pennsylvania-based health system.
Prospect, which had nearly $2.3 billion in total outstanding obligations when it declared bankruptcy, has said it can’t afford to keep Crozer open indefinitely.
Prospect said it had a tentative deal to sell the system in February to a consortium of unnamed buyers. However, that deal fell apart a week later, and the court placed Crozer into a 30-day receivership.
Pennsylvania regulators gave Washington, D.C.-based FTI Consulting $20 million to act as an independent monitor and manager of Crozer while Prospect continued its search for a buyer.
When Prospect blew past that deadline, the state worked again in March to offer Crozer another financial lifeline.
As recently as last week, Crozer dodged closure once again when the Pennsylvania attorney general, Delaware County and Penn Medicine (which has signaled interested in buying at least some of the portfolio) organized to offer Crozer $6 million.
Those funds are short of what is required to fully support operations, an attorney for Prospect said in federal bankruptcy court. However, the money was enough to stabilize operations for about seven to 10 days. Without additional funding or a buyer, Prospect may still close Crozer. The health system has filed court orders seeking to close Crozer multiple times, including as recently as April.
A spokesperson for Prospect did not respond to a request for comment about current efforts to sell Crozer. The Pennsylvania attorney general did not respond to comment by press time.
