Amid reports that paychecks of some Vista Medical Center East employees were not honored by their banks because of insufficient funds on Sept. 11, hospital leaders said Friday that the situation has been remedied.
“Vista Health System is aware that some employees experienced an issue with payroll processing,” hospital officials said in an email. “The matter was addressed with the appropriate banking and financial partners.”
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Vista leaders informed their workforce in an email Thursday in Waukegan that all paychecks would be deposited directly into the workers’ bank accounts by 5 p.m. Friday to alleviate issues that may have occurred two weeks ago on its previous payday.
Though payroll was previously delivered by direct deposit into workers’ accounts, hospital leadership said in the email that paper checks had to be utilized on a temporary basis when the checks were returned.
“During recent operational and banking changes, Vista temporarily utilized paper payroll checks,” the email said. “We have restored direct deposit for employees.”
Neither admitting nor denying there was enough money in its bank accounts to cover all of its Sept. 11 payroll obligations, Vista officials said they “worked with its banking and financial partners to address the payroll processing issue and ensure employees received their pay.”
When Los Angeles-based American Health Care Systems (AHS) bought Vista just over three years ago from Quorum Health Corp., it bought the Vista corporation rather than its assets, leaving it with debts accumulated by Quorum.
Financial problems have plagued AHS’s operation of Vista ever since. Millions of dollars in property taxes for 2023,2024 and 2025 were not paid, as well as hundreds of thousands of dollars in water bills to the city of Waukegan.
When Vista officials were asked whether they have control over its accounts receivable to pay its employees and meet other obligations or AHS gets the money directly, they responded in an email: “The management of accounts receivable and specific financial account arrangements are internal financial and operational matters.”
In an effort to avoid delays in paying its workers in the future, Vista officials said in the email that both the hospital and AHS are working to make sure payroll is met on a consistent basis by directly depositing the money into its employees’ accounts.
“Vista and AHS are strengthening payroll and banking processes, including restoring consistent direct deposit for employees,” the email said. “Our priority is to maintain a reliable and sustainable payroll process moving forward.”
Dealing with payroll is only one of Vista’s financial concerns. The unpaid 2023 property taxes were purchased by First National Assets (FNA), a company that purchases delinquent property taxes as an investment.
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FNA petitioned Lake County Court in January to give it a deed to the real estate where the hospital sits. Though AHS CEO Michael Sarian said in March he was selling the parking lots across the street from the hospital to pay the real estate taxes, it had not happened as of the last court date, Sept. 11.
FNA attorney Gregory Reiter said in court on Sept. 11 that he planned to ask the judge for a deed to the property to take ownership. No one appeared in court for AHS or Vista. Sarian did not respond to calls about the case that day. The hearing is scheduled for 9 a.m. on Oct. 9 in Waukegan.