After months of fighting in court, the owners of West Suburban and Weiss Memorial hospitals hammered out an agreement late Wednesday night that could ultimately see the hospitals sold to Insight Health Systems.
The agreement caps months of battles in court between the two former business partners over who should control the now-shuttered safety net hospitals. It wasn’t immediately clear what the deal will mean for any potential reopening of the hospitals, which both owners have said all along was their goal.
Under the agreement, the owner of Ramco Healthcare Holdings, Reddy Rathnaker Patlola, is buying out his business partner Dr. Manoj Prasad, who is the majority owner of Resilience Healthcare, which has been operating the hospitals. Ramco owns the hospital properties, and Patlola has also been a minority owner of Resilience.
Ultimately, the hospitals would be sold to Insight.
Prasad and his attorneys did not immediately respond to a request for comment Thursday.
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But Patlola said in a statement Thursday that Ramco “expects that the settlement will lead to a completed sale of Weiss Memorial Hospital and West Suburban Medical Center to Insight. Ramco looks forward to the reopening of West Suburban Medical Center and Weiss Memorial Hospital so that those facilities can resume serving the communities that depend on them.”
Insight Hospital and Medical Center President and CEO Atif Bawahab said in a statement Thursday that Insight will now “begin a careful assessment of both hospitals to determine the appropriate path forward for each.” Insight also bought the former Mercy Hospital in Bronzeville for $1 in 2021, when Mercy was on the brink of closure.
“We want to be honest that this is the start of a long, phased process, not the end of one,” Bawahab said. “There are real hurdles ahead — restoring licenses and certifications, rebuilding systems and staffing, meeting regulatory requirements, and earning back the confidence of patients and providers — and none of that happens overnight.”
At a news conference Thursday, Rev. Henry Barlow, who is on the board of Insight, said it could take four months to reopen West Suburban and longer than that for Weiss.
Weiss recently lost its state hospital license and was barred from receiving Medicare payments after a number of issues at the Uptown hospital, including a breakdown of its air conditioning systems. Prasad closed Weiss in August of last year shortly after the federal government said it was terminating Weiss from the Medicare program.
About eight months later, Prasad closed West Suburban Medical Center in Oak Park, saying billing system problems had prevented the hospital from collecting payments for medical care. Prasad and Patlola’s companies sued one another shortly after that closure.
As the owners battled in court, community and faith leaders clamored for the hospitals to reopen. The facilities are safety net hospitals, meaning they serve large numbers of patients on Medicaid, a state and federally funded health insurance program for people with low incomes and disabilities.
On Thursday, a number of community leaders and former employees expressed excitement over the deal.
Rev. Robin Hood, a leader of the Coalition to Save Safety Net Hospitals, called it a “small victory,” though he added that “the real work starts now.”
Dora Pinkley, who worked as a housekeeper at West Suburban for 27 years, called it a “blessing” that Prasad will no longer be in charge of the hospitals.
She said as long as Insight is working on behalf of people in the community, she’s happy to see them take over the hospitals.
“I’m just thankful we’re going to have a new hospital and new ownership, for our community,” said Tabitha Valencia, who was a patient care technician at West Suburban for 29 years.
Not everyone, however, is thrilled with the prospect of Insight stepping in.
Groups that include former West Suburban doctors called the West Suburban Medical Center Medical Executive Committee and the Chicago Medical Society Task Force recently voted that they have “no confidence” in Insight as the potential operator of the hospital. They said in their vote that they have “significant concerns regarding Insight Health System’s ability to provide the transparency, accountability, physician collaboration and community involvement necessary to successfully reopen and sustain West Suburban Medical Center.”
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“We have no idea what Insight wants to do because they have not communicated that to the medical society or the physicians,” said Dr. Vishnu Chundi, a longtime West Suburban physician and chair of the Chicago Medical Society’s Task Force to Restore Care at West Suburban Medical Center. He said West Suburban’s physicians know what types of services the community needs, and have questions about whether and how those services might be restored.
“What they’re going to open it as, and what kind of hospital it’s going to be, if it ever opens, remains to be seen,” Chundi said Thursday.
Typically, the Illinois Health Facilities and Services Review Board must approve any hospital changes in ownership.
Also, Insight has faced its own financial struggles. As of February, Insight owed more than $48 million to the state in loan money and was not in compliance with the terms of its repayment agreement, according to information obtained from the state through a Freedom of Information Act request. In 2024, the hospital’s expenses exceeded its revenue by nearly $29 million, according to tax records.
The settlement agreement reached late Wednesday night follows a rollercoaster six months in court over the hospitals’ futures.
The judge in the case had said late last week that he planned to appoint a receiver to control the hospitals, after Resilience had refused to finalize a settlement agreement that the owners had previously agreed to in principle. That pronouncement apparently sparked renewed discussions between the parties in recent days. A receiver is no longer necessary now that they’ve reached a different agreement.
Additional details about the new settlement agreement were not available Thursday. But a previous proposed settlement agreement between Ramco and Resilience would have required the owners to try to sell the hospitals to Insight, would have required Prasad step down as CEO and stipulated that Prasad be paid $100,000 to act as a consultant for up to six months.