Pennsylvania state Sen. Tim Kearney has raised concerns about the lack of transparency and details around the planned sale of Upland, Pa.-based Crozer Health and has called on the state attorney general to step in and conduct a thorough analysis of the deal, the Daily Times reported Aug. 22.
Earlier this month, Los Angeles-based Prospect Medical Holdings and CHA Partners signed a letter of intent for CHA to acquire Crozer. The proposed deal would involve transitioning Crozer's four hospitals back to nonprofit status.
"Prospect's proposed sale of Crozer to CHA Partners LLC exemplifies the need for state oversight of hospital sales, as both entities appear to have histories of burning public partners despite demanding hefty subsidies," Mr. Kearney said in a statement shared with Becker's.
Unlike many other states, Pennsylvania's Attorney General lacks statutory authority to deeply evaluate these deals, according to Mr. Kearney.
"While the AG's legal settlement with Prospect gives them some oversight of this deal, the legislature needs to provide the AG with greater authority to protect hospitals and the communities that depend on them," he said. "If the choice is CHA or closure, then we need some assurances that they will be a responsible organization and not just a profiteering speculator."
Prospect, a for-profit company, plans to sell nine of its 16 hospitals in Pennsylvania, Rhode Island and Connecticut and is also being investigated by the Justice Department for alleged violations of the False Claims Act. A spokesperson for Prospect told Becker's the system will continue to cooperate with the investigation, but feels that the allegations have no merit.
CHA did not respond to Becker's request for comment.