FTI Consulting chosen to temporarily run Crozer Health

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The Pennsylvania Office of Attorney General and Prospect Medical Holdings struck a deal to have FTI Consulting temporarily run Crozer Health in Delaware County.

The Washington D.C.-based firm will receive an unspecified amount of funding from the state to help keep the hospitals open, according to the latest filing with a federal bankruptcy judge.

“The Payments shall remain unencumbered and be used solely for the purposes of the Facilities’ working capital, patient care and employee salaries in the Commonwealth,” the filing read.

The terms of the agreement need final approval from U.S. Bankruptcy Judge Stacey Jernigan, who will review it Thursday afternoon.

If approved, FTI Consulting will serve in its capacity of receiver for at least 30 days.

The California-based Prospect filed for Chapter 11 bankruptcy in January and revealed its plans to shift focus on its operations in the Golden State — and intentions to offload its hospital systems in Connecticut, Pennsylvania and Rhode Island.

The company purchased Crozer in 2016. Crozer operates just two functioning hospitals: Crozer-Chester Medical Center in Upland and Taylor Hospital in Ridley Park. Delaware County Memorial Hospital and Springfield Hospital are essentially closed.

Prospect Medical Holdings announced Friday intentions to sell Crozer Health to a “not-for-profit consortium of healthcare operators.” The receivership buys parties more time to negotiate the framework of such a deal.

Prospect recently shared with state lawmakers a scenario in which Crozer-Chester and Taylor could cease to operate if an agreement is not reached in time.