Meadowbrook, Pa.-based Redeemer Health’s board plans to sell or close Holy Redeemer Hospital after the health system sought Chapter 11 bankruptcy protection Nov. 1.
The decision was disclosed in a Nov. 1 declaration filed in the U.S. Bankruptcy Court for the Eastern District of Pennsylvania, where Redeemer Health and 11 affiliates filed their Chapter 11 petitions; the document was reviewed by Becker’s.
“The board of trustees of [Redeemer Health] has determined that continued operation of Holy Redeemer Hospital is not sustainable and has made the decision to sell and/or close the hospital in accordance with Pennsylvania law,” James Logue, president and CEO of Redeemer Health, said in a declaration filed with the petitions. “In connection therewith, the company is in the process of working with its advisors to maximize the value of those assets for the benefit of creditors and sustained operations of the Company otherwise.”
Redeemer Health is seeking a buyer for the 239-bed hospital and its physician network while also developing a wind-down plan should a sale not be possible.
The hospital and its physician network have lost between $31.6 million and $48.9 million annually over the past five years, the filing said, with its unaudited fiscal 2026 losses being the most significant. Redeemer’s other services, including its community and post-acute operations, have historically helped support the hospital and physician network, but “they can no longer keep pace with the sustained losses,” Mr. Logue said.
Holy Redeemer’s OB-GYN program has seen more than 11,000 deliveries since 2021, but the system’s malpractice costs average about $16 million annually, with a significant amount tied to maternity services.
Redeemer Health reported approximately $441 million in total liabilities as of April 30, 2026. The system plans to keep and invest in its older adult and life care operations, as many remain financially stable and did not file for bankruptcy, the document said.
The health system has about 2,770 full-time, part-time and temporary employees, with about $8.39 million in unpaid employee wages and compensation. Redeemer asked the court’s permission to pay it. The system also had approximately $700,000 approved on Nov. 4 to help pay 29 “key” employees.
The bankruptcy court held a hearing Nov. 4 on Redeemer’s request to use cash collateral, and U.S. Bankruptcy Judge Derek Baker entered an interim order Nov. 9 allowing it. A final hearing is scheduled for Dec. 14.
Redeemer Health is a Catholic health system that comprises Holy Redeemer Hospital and a physician and provider network. It also has outpatient services and ambulatory sites, a transitional care unit, home health and hospice services, three skilled nursing facilities, personal care, a retirement community, low-income housing, an independent living community, a trauma-informed community resource for families experiencing homelessness, multiple food pantries and homes for developmentally and intellectually disabled adults, according to a Nov. 2 news release shared with Becker’s.
