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ChristianaCare will not buy Crozer Health after signing letter of intent in February: "Really would have been a great thing for Delaware County"

ChristianaCare will not buy Crozer Health
ChristianaCare will not buy Crozer Health 01:04

DREXEL HILL, Pa. (CBS) -- A deal between two hospital systems in our area isn't going through. ChristianaCare Health System was going to buy Crozer Health, but both sides announced talks ended with no deal on Thursday.

Crozer Health operates four hospitals in Delaware County – Crozer-Chester Medical Center, Delaware County Memorial Hospital, Springfield Hospital, and Taylor Hospital. 

ChristianaCare has more than $2 billion in annual revenue. Hospital employees were hoping that ChristianaCare would use some of that money to bring back maternity, elective surgeries and other services that were cut earlier this year so patients wouldn't have to go to keep going elsewhere for care.

Those hopes are now dashed.

It's a major setback for Delco's largest healthcare system and its four hospitals, and those most affected, patients.

The Delaware-based non profit ChristianaCare is backing out of its plan to buy  Crozer Health from the California-based company Prospect Medical Holdings.

"I was more than a little disappointed," Pennsylvania State Rep. Mike Zabel (D) said. "We had hopes that Christiana, as a nonprofit would come in and their mission would be more aligned with community health than it has been under Prospect's ownership of Crozer."

Christianacare and Prospect declined to say why the deal fell through, but ChristianaCare did say the economic landscape has changed significantly since the agreement was made in February to buy Crozer.

"Really would have been a great thing for Delaware County and for our community, for Christiana, with their resources and reputation, to come in and help our county," Peggy Malone, President of the Crozer-Chester Nurses Association, said. 

Back in May, Malone led a protest after Prospect closed the maternity ward at Delaware County Memorial Hospital and suspended inpatient services at Springfield Hospital.

Prospect also laid off 100 employees in February.

The hope was that ChristianaCare, with its large financial resources, would restore the services and bring those jobs back.

"People around here have already been suffering," Zabel said. "Upper Darby is the largest municipality in Delaware County. It is unconscionable that there is not a fully functioning hospital here."

In a statement, Crozer said it's committed to serving the community and plans to return to nonprofit status.

It also says it's planning to restore emergency and outpatient services at Springfield Hospital.

Von Crockett, the SVP of Corporate Development for Prospect Medical Holdings, released a statement following the news:

"Since entering into a letter of intent in February, and thoughtfully considering how we might work together, we have mutually decided to discontinue talks involving the sale of Crozer Health to ChristianaCare.

Our organizations have significant respect for each other and remain committed to caring for the health of the communities we serve. Crozer Health will now continue to engage in a strategic review that will determine the best path to stabilize the health system, the first step of which will be converting to nonprofit status. This work will rely on engaging medical staff to help define how the services we offer best meet community needs, as well as other healthcare providers we'll look to in determining opportunities for affiliation and collaboration. We also will immediately begin to engage our health plan partners, community leaders and regulatory bodies to ensure Crozer Health's sustainability well into the future."

Delaware County also released a statement:

"The County was disappointed to hear that CristianaCare is not proceeding with its transaction with Prospect- Crozer. We will continue to keep lines of communications open with CristianaCare, and hope it enters the vital Delaware County market, in the future.

As to Crozer Health, the County appreciates positive steps that have occurred during the summer to maintain certain services and provide competitive wages to their health professionals, and we expect Crozer Health to remain an important provider of health services in the County, and a key employer.

County Council understands that local government plays an important role in protecting the local health infrastructure, and we will continue to focus on ensuring that all County citizens have access to high-quality health services."

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