Last checked: October 25, 2026. This independent guide to the Prospect Medical Holdings bankruptcy is not affiliated with Prospect, Crozer Health or any hospital.
The Prospect Medical Holdings bankruptcy is the reason Crozer Health no longer exists. Prospect, the Los Angeles company that owned Crozer, filed for Chapter 11 on January 11, 2025, and within four months it had used the case to close Crozer-Chester Medical Center and Taylor Hospital, lay off roughly 2,650 workers and put every Crozer property up for sale. A federal judge confirmed Prospect’s exit plan in December 2025, and the company has spent 2026 finishing sales and winding down.
This guide explains what the bankruptcy did in Delaware County, what it means for former patients and workers today, and what is still unresolved. For the newest developments, see our latest Crozer update, which we refresh every month. If you need medical records from Crozer, start with our step-by-step records guide, because there is a hard deadline.
Prospect Medical Holdings bankruptcy at a glance
| Item | Detail |
|---|---|
| Company | Prospect Medical Holdings Inc., Los Angeles |
| Filed | Saturday night, January 11, 2025 (Chapter 11) |
| Court | U.S. Bankruptcy Court, Northern District of Texas (Dallas), Chief Judge Stacey G.C. Jernigan |
| Debt | About $2.3 billion in funded debt |
| Hospitals at filing | 16, in California, Connecticut, Pennsylvania and Rhode Island |
| Crozer closure approved | April 2025; Crozer-Chester’s last patients left May 2, 2025 |
| Plan confirmed | December 12, 2025 |
| Plan effective | March 6, 2026, the day the Rhode Island hospital sale closed |
The filing date, court and early figures come from the Philadelphia Inquirer’s January 2025 report on the filing. The $2.3 billion debt figure and confirmation date come from Prospect’s bankruptcy counsel, Sidley Austin.
Why Prospect filed for Chapter 11
Prospect had been in trouble for years. According to Healthcare Dive, it had missed payments to vendors and staff and stopped paying rent to its landlord, Medical Properties Trust, in mid-2024. Prospect CEO Von Crockett blamed lingering effects of COVID-19, inflation, a 2023 cyberattack and more claim denials from insurers.
Critics pointed to the company’s ownership history. The private equity firm Leonard Green & Partners owned Prospect from 2010 to 2021. A U.S. Senate Budget Committee report released days before the filing found Prospect paid $645 million in dividends and preferred stock redemptions, $424 million of which went to Leonard Green investors. Leonard Green disputed the report. Crozer’s buildings had also been sold to Medical Properties Trust and leased back, which the Inquirer reported left Crozer with about $35 million a year in rent.
For Crozer specifically, the filing paused the Pennsylvania attorney general’s lawsuit, filed in late 2024, which sought to take control of Crozer and recover $457 million in dividends. Our article on why Crozer hospital closed covers that longer history.
What the bankruptcy meant for Crozer
When the Prospect Medical Holdings bankruptcy began, the plan was to keep Crozer-Chester and Taylor open and sell them. The company lined up a $100 million loan to run its hospitals during the case and said it would refocus on California. It did not work out in Delaware County.
Rescue attempts that failed
A tentative deal with a consortium of nonprofits fell apart in early 2025, and later talks involving Penn Medicine also failed. To buy time, the state, the county and the Foundation for Delaware County put up about $40 million: $10.2 million from the Commonwealth, $9.8 million from the county and $20 million from the foundation, according to WHYY. Crozer was placed in a short receivership run by FTI Consulting while a buyer was sought. Prospect told the court Crozer was losing about $12 million a month.
The closure order
On April 21, 2025, Prospect told state regulators it would close Crozer-Chester and Taylor and filed layoff notices for about 2,650 workers. The next day Judge Jernigan approved the wind-down. “I lose sleep over this case,” she said, adding that “we can’t print money,” as reported by Healthcare Dive. Penn had offered $5 million for certain assets, but Prospect’s lawyer called it “a bridge to nowhere,” the Pennsylvania Capital-Star reported. Delaware County declared an emergency and opposed the plan.
Crozer-Chester’s emergency department closed April 30, 2025, and the last patients left May 2. Delaware County was left with two general hospitals, Riddle in Media and Mercy Fitzgerald in Darby. Our Crozer closure timeline lays out each date.
Selling off the Crozer properties
The bankruptcy court then oversaw the sale of everything Crozer owned. None of the four hospitals went to a buyer that has reopened it as a hospital so far.
| Property | Buyer | Price and timing |
|---|---|---|
| Outpatient sites (Brinton Lake, Haverford, Broomall, Media imaging) | ChristianaCare | Bought May 2025 |
| Delaware County Memorial Hospital, Drexel Hill | Upper Darby School District | Sale closed August 2025 |
| Taylor Hospital, Ridley Park | KQT Aikens Partners | $1 million, September 2025 (who bought Taylor Hospital) |
| Crozer-Chester Medical Center, Upland | Chariot Allaire | $10 million, closed January 2026 |
| Springfield Hospital | KQT Aikens Partners 2 | $1 million, March 2026 |
Ownership details come from the Delaware County Prospect update page and news coverage; our Crozer sale guide covers each buyer’s plans.
When was the Prospect Medical Holdings bankruptcy plan confirmed?
Judge Jernigan confirmed Prospect’s Chapter 11 plan on December 12, 2025, overruling objections from vendors, insurers and workers. Sidley said the plan lets Prospect finish hospital transfers, wind down in an orderly way and gives creditors a way to recover money through “valuable litigation claims.” It also says administrative and priority creditors will be paid in full. The judge said she was not sure she had ever overseen a more complicated case.
The plan took effect on March 6, 2026, the same day Rhode Island’s Roger Williams Medical Center and Our Lady of Fatima Hospital passed to the Centurion Foundation. Prospect’s other East Coast hospitals were also sold: Hartford HealthCare took over Manchester Memorial and Rockville General in Connecticut on January 1, 2026, in an $86.1 million deal, and UConn Health completed its purchase of Waterbury Hospital on March 1, 2026, according to Becker’s Hospital Review. Prospect’s physician network business was sold to Astrana Health for more than $700 million.
What it means for you now
Former Crozer patients
The most urgent issue is records. The bankruptcy court approved Prospect’s request to destroy remaining Crozer patient records after March 2, 2027, except imaging that ChristianaCare can access. Requests go through Morgan Records Management, and a $3 million fund from the Foundation for Delaware County covers fees for up to 43,000 patients. Read our breakdown of the March 2027 records deadline and find the right contacts in our Morgan Records phone guide.
Former Crozer employees and retirees
The Crozer-Keystone Health System Employees Retirement Plan, which covers 4,447 people, ended on May 31, 2025. The federal Pension Benefit Guaranty Corporation became its trustee on June 2, 2025, according to PBGC’s plan page. PBGC pays insured pension benefits up to limits set by law, so some people with large pensions may get less than they were promised. PBGC’s customer contact center is 1-800-400-7242. This guide can’t tell you what you will receive; PBGC is the only source for your number.
Creditors and vendors
Claims, notices and court filings are posted on the case website run by the claims agent, Omni Agent Solutions, which Delaware County links from its update page. The case number is 25-80002 in the Northern District of Texas.
What is still unresolved
Three questions remain open as of late October 2026.
First, accountability. In April 2025, 15 Delaware County lawmakers asked Attorney General Dave Sunday to open a criminal investigation and to try to recover the $40 million in rescue funding. Sunday said getting money out of the bankruptcy “will be difficult” and that he would use any legal tool available against Leonard Green. We have not found a public outcome of those efforts.
Second, health care on the Crozer-Chester campus. Chariot Allaire’s CEO, Yoel Polack, told a community meeting this month that the owners expect to learn in the first quarter of 2027 whether a health system will anchor the site and whether state money will follow, the Inquirer reported on October 22, 2026. No operator or emergency room date has been named.
Third, the records deadline itself, which is now about four months away.
In an emergency, call 911. For a mental health crisis, call or text 988.
Frequently asked questions
Is Prospect Medical Holdings still in business?
Only in a limited sense. The Prospect Medical Holdings bankruptcy plan took effect in March 2026, and it has sold its Pennsylvania, Connecticut and Rhode Island hospitals. The plan provides for an orderly wind-down of the remaining estates. It no longer owns any Crozer facility.
Did the bankruptcy close Crozer-Chester Medical Center?
Yes. The bankruptcy judge approved Prospect’s closure plan in April 2025 after rescue funding ran out and no buyer stepped in. The hospital’s last patients left on May 2, 2025.
Who owns the Crozer hospitals now?
Crozer-Chester belongs to Chariot Allaire, Taylor and Springfield to companies tied to KQT Aikens, and the old Delaware County Memorial Hospital to the Upper Darby School District. ChristianaCare bought four Crozer outpatient sites.
What happened to Crozer pensions?
The federal Pension Benefit Guaranty Corporation took over the Crozer-Keystone retirement plan in June 2025 and pays benefits up to legal limits. Call PBGC at 1-800-400-7242 for your own figures.
Can I still get my Crozer medical records?
Yes, until March 2, 2027, through Morgan Records Management. After that date, remaining records are scheduled for destruction.
An independent guide. Crozer Health Center Guide is not affiliated with Crozer Health, Prospect Medical, Main Line Health, Trinity Health or any hospital, and nothing here is medical advice. In an emergency, call 911. For a mental health crisis, call or text 988.
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