After months of court hearings and negotiations with various stakeholders, Upland, Pa.-based Crozer Health will shut down and lay off more than 2,600 employees, according to a closure notice from parent company Prospect Medical Holdings.
The decision follows failed efforts to find a buyer for key Crozer facilities and comes just three days after Crozer CEO Tony Esposito stepped down.
In a letter shared with state officials, Los Angeles-based Prospect said it had been working with the Pennsylvania Attorney General’s office to facilitate a sale of Crozer-Chester Medical Center and Taylor Hospital, NBC Philadelphia reported April 21. However, on April 18, the company learned that no prospective buyers — including the University of Pennsylvania Health System, which had offered $5 million to extend negotiations — would proceed.
“As a result of the unforeseen circumstances described above, Prospect is forced to close operations and permanently lay off the Pennsylvania employees listed below,” the company wrote.
A total of 2,651 employees across eight Crozer facilities will be laid off in a move Prospect said is expected to take place between April 25 and May 2. The closure process and patient transition plans have not yet been outlined.
FTI Consulting, which had served as the court-appointed receiver for Crozer, confirmed the end of the receivership and said Prospect is now responsible for overseeing the closure.
“As of April 18, 2025, the receivership of Crozer Health has ended,” FTI said in a statement shared with Becker’s. “We are disappointed an alternative resolution and sale could not be reached. The ‘FTI plan’ was one of recovery and exploration of a possible sale, not closure.”
FTI maintains that its plan was always “one of recovery and exploration of a possible sale, not closure.”
Prospect, which acquired Crozer in 2016, said it has worked “tirelessly” with the state to explore every possible avenue to avoid shutdown, but has “made the extremely difficult decision to begin winding down operations across our Crozer Health facilities,” the company said in an April 21 statement shared with Becker’s.
Some outpatient centers — including ambulatory surgery and imaging sites in Brinton Lake, Broomall, Haverford and Media — will remain open for now.
The Pennsylvania Attorney General’s Office placed blame squarely on Prospect’s private equity owners, Leonard Green & Partners, accusing them of prioritizing profit over community health.
“We worked tirelessly to avoid this outcome. Unfortunately, the damage inflicted by Leonard Green & Partners … was too much to overcome,” the attorney general’s office said in a statement. “We will continue to work through the bankruptcy process to pursue the Commonwealth’s financial claims to the greatest extent possible in order to hold Prospect accountable for actions that caused this closure.”
Becker’s will continue to monitor this story as it develops.