Chicago Hospitals Plan for Change of Ownership
California-based Pipeline Health has executed a letter of intent to sell West Suburban Medical Center in Oak Park and Weiss Memorial Hospital in Chicago’s Uptown neighborhood for $92 million to a healthcare management group with decades of experience turning around challenged community hospitals through innovation and collaboration with local communities, clinicians and front-line staff.
Michigan-based Resilience Healthcare, led by Manoj Prasad, a healthcare executive with over two decades of experience in healthcare turnarounds, will be acquiring the two hospitals and the campus properties, pending approval from the Illinois Health Facilities and Services Review Board. Prasad says he is in the process of moving to the Chicago area and plans on working full-time to shore-up the financial position of both hospitals to make them sustainable and continue in their mission of providing critical healthcare services to both communities.
“My career turning around hospitals and health care organizations has been based on collaborations with and alignment of the medical staff, nurses, support staff and staff on the front lines at hospitals,” said Prasad. “I listen to them and to our patients and community partners and they see I am willing to roll up my sleeves and work side-by-side with them. We get aligned on the common goals of providing our patients high quality and affordable care and turning around a treasured community asset.”
Prasad continued, “This is a wonderful opportunity to serve the patients and communities of Oak Park and residents of the West Side as well as Chicago’s Uptown neighborhood and beyond. We’re excited to secure state approval and get to work.”
The two parties are submitting a change of ownership application with the Illinois Health Facilities and Services Review Board.
“Both parties are interested in a smooth and seamless transition,” said Pipeline CEO Andrei Soran. “All hospital operations will continue as usual with quality, compassionate care delivered to all patients served.”
Since taking ownership of the two hospitals in 2019, Pipeline has made significant investment in both facilities -- $60 million total -- especially under new corporate leadership in place since January 2021.
“Investments have improved facilities, added technology, expanded clinical programs – all to improve patient care and service to the community,” Soran said. “The two hospitals are in better shape now than when the previous Pipeline leadership team took ownership in 2019.”
According to Pipeline, the company plans to refund $12 million of the $92 million purchase price for reinvestment into the hospitals to ensure that proceeds from the pending sale of a parking lot at Weiss Memorial Hospital benefit that hospital along with additional investment in West Suburban.
“We want to be transparent in letting the community know that the applications for a change of ownership are in development, and we look forward to engaging the community in a conversation about the promising future for the continued operation of the hospitals,” said Nick Orzano, Pipeline founder and board member. “We have been struggling to make these hospitals successful. Manoj approached us to take on the challenge, and we believe he is an excellent fit, with a proven track record of success, for the communities we serve.”
Orzano added that the hospitals’ future success is closely tied to the ongoing support of the State of Illinois, the elected officials and community leaders with whom the hospital leadership has engaged over the last year.
Prasad has been a hospital transformation leader since 1998 after successfully turning around hospital and health systems operations in Michigan, Texas and Florida over the past 20 years. He also built a healthcare technology practice for major healthcare technology companies. New Jersey-based businessman Rathnakar R. Patlola is a financial partner in Resilience and will be investing in the acquisition and operations if the change of ownership is approved. Both Prasad and Patlola have a long-term commitment to providing critical health services to the West Suburban and Weiss communities.
“Rathnakar is a very successful entrepreneur in the hospitality and energy industry. We have known each other for years and have been looking for the right opportunity to collaborate. Now we are aligned at the right moment in our lives and we are partnering to create a vibrant, self-sustaining, service-oriented healthcare provider system for the community,” Prasad said.
Located in Oak Park, West Suburban is a safety net hospital serving an at-risk community. Approximately 76 percent of patients are African American, and more than 80 percent reside in the Austin community of Chicago’s West Side. Weiss is a high Medicaid hospital serving Chicago’s diverse Uptown community on the city’s North Side. The two hospitals have a long history of providing critical healthcare services to the community.
--March 10, 2022