Chester County hired an investment bank to contend with Tower Health hospital closures

Brandywine Hospital near Coatesville is scheduled to close its remaining services Monday, a month after Jennersville Hospital shut its doors in the southern part of Chester County.

Even so, there’s been a flurry of activity about what is to become of those Tower Health institutions — and health care more broadly in that mostly rural stretch of Pennsylvania’s wealthiest county.

The Chester County Commissioners on Wednesday approved a contract worth up to $250,000 with Juniper Advisory LLC, a Chicago investment bank, “to evaluate potential options for the provision of acute care, emergent, and behavioral health services in Chester County.”

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The contract, which runs through Dec. 31, gives the commissioners “the ability to vet any potential purchasers or operators of those hospitals,” Marian D. Moskowitz, chair of the Board of Commissioners, said after the vote for the Juniper contract.

“We’re going to try to make something happen there. Just bear with us. it’s not easy. Once the hospitals close it’s harder to open them,” she said.

Brandywine Hospital could receive an estimated $1.25 million in aid from Harrisburg under a measure passed this week and signed by Gov. Tom Wolf, but it would have to stay open through at least December.

State Sen. Carolyn Comitta (D., Chester) said she supports the efforts by the commissioners and others to find new operators for the hospitals and would work to make that money available if a company emerged to reopen Brandywine.

Last week, the Texas company that agreed in November to buy Tower Health’s Brandywine and Jennersville Hospitals has filed a lawsuit to reinstate the deal, which Tower canceled in early December.

Canyon Atlantic Partners LLC is also seeking to block Tower from closing Brandywine on Monday.

A hearing on a preliminary injunction request, set for Thursday in Chester County’s Court of Common Pleas, was postponed, adding to the extreme unlikelihood that Canyon’s lawsuit could keep Brandywine open. The hospital stopped taking behavioral health patients Saturday.

The Jan. 19 lawsuit revealed the financial flimsiness of the Canyon agreement.

Canyon, based in Texas, was supposed to pay up to $16.5 million, the suit indicated.

Canyon had to pay just $1 million at closing and then another $11 million spread over five years of monthly installments. Tower would have retained title to its real estate until $12 million was paid. The agreement called for Canyon to pay Tower an additional $4.5 million based on the hospitals’ future profitability.

In addition, Canyon Atlantic was supposed to invest at least $5 million in the two hospitals during its first three years of ownership. At the same time, Canyon Atlantic promised to operate the facilities as hospitals for at least two years.

Canyon’s CEO David Kreye has been an executive in a series of companies that went bankrupt.

Tower declined to comment on the lawsuit.

Tower, based in West Reading and anchored by Reading Hospital there, on Tuesday told investors that it is continuing to struggle financially amid the omicron surge.

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Tower and other health systems are contending with high labor costs because of a widespread nursing shortage.

In October and November, Tower ran up an operating loss of $24 million, up from a loss of $16.75 million in the three months ending Sept. 30, according to the presentation.