Hartford HealthCare is one step closer to purchasing two hospitals owned by Prospect Medical Holdings, which filed for bankruptcy earlier this year.
During a public hearing Tuesday, the health system presented its case to Connecticut’s Office of Health Strategy (OHS). State officials will need to issue a decision on the proposal by the end of the year.
In a statement to Newsweek, a spokesperson for Hartford Healthcare said it was proud to be named the buyer of Manchester Memorial and Rockville General hospitals by the bankruptcy court.
“As a Connecticut-based health system with a national reputation and track record of excellence, Hartford HealthCare is uniquely positioned to deliver on our promise to these communities,” the spokesperson said. “We are actively working to provide resources to stabilize and grow the workforce, enhance quality and safety, and make strategic investments in people, programs, technologies, facilities and community partnerships.”
Why It Matters
This comes as a bankruptcy judge in Texas approved UConn Health’s bid to buy Waterbury Hospital, another one of Prospect’s hospitals in Connecticut.
Prospect Medical Holdings, which owns four hospitals in Connecticut, filed for Chapter 11 bankruptcy in Texas back in January. A month later, Connecticut Attorney General William Tong accused the holding company of negligent misrepresentation, unjust enrichment, negligent performance of duties, violations of privacy laws and violations of the Connecticut Unfair Practices Act.
Even before filing for bankruptcy, Prospect and the state had been engaged in a lengthy legal battle over the deterioration of services at the hospitals.
Tong said in a statement shared with Newsweek that Prospect promised to make robust investments in the four Connecticut hospitals when it bought them in 2016, but did not follow through on its commitments to improve and expand services, protect patient information and faithfully care for the community.
“We must ensure that this type of abuse never again occurs in our state,” he said in the statement. “We have to keep capitalist vultures like Prospect from ever again looting our community assets.”
What To Know
Hartford HealthCare told Newsweek that every hospital that has joined its health system has seen measurable improvements, including top safety ratings, expanded access to care close to home, cutting-edge technology and the recruitment of world-class clinicians.
“We look forward to continuing our collaboration with the state and community stakeholders to complete the next steps in this journey and to advance our mission ‘to improve the health and healing of all,’” the spokesperson said.
At the hearing, Hartford HealthCare CEO Jeffrey Flaks said this is a unique opportunity to “dramatically improve health care that will be here for generations going forward,” according to the CT Mirror.
Hartford HealthCare would spend $86.1 million to purchase the hospitals and invest another $225.7 million in capital improvements over the next three years. The health system also plans to recruit new physicians, modernize hospital technology and expand access to specialty care, according to the hospital's application.
“It is my sincere hope that today marks the beginning of the end of a dark period for the many Connecticut patients, healthcare providers, employees and communities who put their trust in Prospect Medical Holdings,” General Attorney Tong said in a statement.
Tong added that he expects Hartford HealthCare leadership to restore “high quality, safe, and reliable health care to Manchester, Vernon and surrounding communities” and maintain essential services like labor and delivery, intensive care and behavioral health.
“Expectations must be matched by accountability: Absent other legal impediments, I would urge the Office of Health Strategy to seek firm commitments to continue these vital services,” he said.
What Happens Next
The Office of Health Strategy has 60 days to rule on Hartford HealthCare’s proposal. This comes as the state legislature approved a new emergency process for hospitals involved in bankruptcy proceedings. OHS will have to make a decision by December 30, 2025.
What People Are Saying
Connecticut Attorney General William Tong said in a statement shared with Newsweek: “Although Prospect may be on its way out the door, this is not the end of private equity in Connecticut’s health care system. In recent years, we have seen the rise of private equity in nursing homes and physician practices, among other sectors. In the physician practice space, private equity pitches itself as a promising solution to the challenges of private practice, offering management services and buy outs to senior clinicians seeking to retire. Despite these apparent benefits, the consequences to patients can be dire: Private equity firms may inappropriately pressure clinicians to see more patients, shorten appointments, perform more procedures, upsell patients on products not covered by insurance and raise out-of-pocket costs.”
Newsweek reached out to Prospect Medical Holdings for comment.
Have an announcement or news to share? Contact the Newsweek Health Care team at [email protected].
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