Secret meeting held to oust West Suburban CEO before hospital’s closure, warnings of dire situation

OAK PARK, Ill. (WLS) — The abrupt closure of West Suburban Medical Center in Oak Park last month came as a shock to suddenly unemployed staff, a wide variety of patients, and the communities relying on the safety-net hospital. But the closure was not a shock for some as the ABC7 I-Team has learned state officials were warned of the dire situation in meetings a month prior where a plan was presented to evict the current management in place, and even potentially install a court-appointed receiver to oversee the recovery of operations. ABC7 Chicago is now streaming 24/7. Click here to watch Documents obtained by the I-Team show a co-owner of the hospital’s operations, former hospital executives, and the Illinois Department of Healthcare and Family Services (HFS) chief of staff met on Feb. 11 to discuss the “Operational Recovery & Stabilization Plan” for West Suburban Medical Center. The Feb. 11 meeting centered around the key challenges the hospital was facing, and the impacts its closure would have on nearby hospitals and communities as the “largest employer in the area” with “approximately 700 employees.” A spokesperson for West Suburban’s current CEO, Manaj Prasad, said he had no knowledge of the meeting organized to potentially oust him. The state of Illinois has been working consistently to support the facility as it faced serious financial and operational challenges caused by its leadership,” an HFS spokesperson said in part. SEE ALSO | Leaders of West Suburban Medical Center in Oak Park working to resume operations West Suburban Medical Center is a safety-net hospital and stroke center that served the West Side of Chicago, Berwyn, and Austin communities, “delivering 1, 000 babies per year” with a “very active” emergency room destination for more than “2, 000 ambulance runs per month,” internal documents show. As ABC7 previously reported, on March 25, West Suburban Medical Center in Oak Park announced it was suspending all patient care services. Resilience Healthcare CEO Manoj Prasad attributed the closure to problems with the billing system that had resulted in the hospitals not charging patients properly, with the facilities running on just a small portion of their normal revenue. Resilience Healthcare took over operations of West Suburban Medical Center and Weiss Memorial Hospital in 2022 after purchasing the hospitals from its previous owner, Pipeline Health System, LLC, which had filed for bankruptcy protection. While one company, Ramco Holdings, was the sole-landowner of both properties, ownership stakes in Resilience Healthcare’s operations were split between Ramco’s owner, Reddy Rathnaker, and AUM Global Healthcare Management’s owner, Manoj Prasad. A spokesperson for Ramco Holdings declined to comment on this report. More than a month prior to the announced closure of West Suburban Medical Center, sources with knowledge of the hospital’s operations said Rathnaker held a meeting with state officials to discuss a plan to take over Prasad’s ownership and management of the facilities, warning closure could be imminent. The Feb. 11 meeting included Rathnaker and staff working for him, Illinois HFS Chief of Staff Dana Kelly, two former executives of Resilience Healthcare, as well as a potential healthcare facility receiver to oversee the rollout of the plan. Part of the plan included placing the hospital into a court-monitored receivership to account for finances after evicting Prasad and other management from the hospitals. READ MORE | West Suburban Medical Center temporarily closing obstetric, neonatal units: IDPH In a statement to the I-Team, receiver Michael Flanagan said he only attended the first Feb. 11 meeting, “where I was introduced as a potential candidate to serve as a receiver if a court were inclined to appoint one, as I have served as a court appointed receiver over various health care facilities in the past.” Some of Resilience Healthcare’s challenges discussed at the meeting included, “ongoing lack of financial and material resources” resulting in “emergency room physicians issuing a breach notice,” and failing equipment “such as a non-functioning CAT scanner and inadequate telemetry and imaging equipment. Specialty coverage in emergency department and facility overall is severely limited, with inconsistent cardiology support, no gastroenterology or ENT support, sporadic OBGYN coverage, and unreliable access to both gastroenterology and GYN specialists, further hindering patient safety,” the presentation noted. Some of its stakeholders painted a bleak picture for what would happen if West Suburban Medical Center closed its doors. “Loretto and Community First Hospitals (closest facilities) are not equipped to handle acuity of West Suburban patients,” the plan presentation noted. “If closed, neighboring hospitals will be overwhelmed by the volume of patients coming in creating congestion in already busy facilities.” The plan continued, “If [ West Suburban ] closed, [ it ] will create a healthcare desert for the underserved population long ambulance runs will impact patient outcomes.” A spokesperson for HFS told the I-Team officials attended the meeting, “in order to continue to learn as much as possible about the hospital’s situation. State officials took seriously the information presented and followed up as appropriate.” The statement continued: “Ultimately, West Suburban and Weiss Memorial are private facilities, and despite intensive financial and operational support from the State, its leadership did not take the steps necessary to keep the facility in operation.” HFS noted state taxpayers have loaned the hospitals more than $30 million since 2023, but “As of today, no repayments have been received. To be clear, HFS does not provide emergency funding to any hospital without the expectation that the hospital will pursue financial recovery and agree to terms of repayment,” an HFS spokesperson said. Payment and care issues were prevalent well before West Suburban was forced to close its doors. In a letter dated Jan. 20, 2026, Illinois Emergency Medicine Specialists (IEMS) sent Resilience Health CEO Prasad a formal notice of contract breach. IEMS contracts emergency medicine doctors to hospitals, including west suburban. The letter stated Resilience Healthcare owed doctors more than $900,000 and, “Despite more than five prior written notices of breach, multiple extensions of time, and repeated opportunities to cure, the Hospitals have failed to remedy their payment defaults.” The letter goes on to say IEMS was within its rights to cancel doctors’ services if payment was not received. West Suburban was also cited 10 times in the last two years by the US Department of Health and Human Services for deficiencies in standards of quality for patients, issues with medication error rates, infection prevention control, and more. Records show the hospital resolved those citations. All of those issues happened under the ownership of Resilience Health. At a news conference last week, Resilience Health CEO Prasad blamed the hospital’s billing system for what happened. “Because of the system malfunctions, we were able to collect only 10% and a little over 10% of what our normal revenues are,” Prasad said. “I don’t want us to work and have our employees have a payless payday.” Altera Digital Health, which owns the Paragon billing system that the hospital implemented in mid-2025, told the I-Team in part, “Our teams have devoted substantial time and resources to supporting hospital management and providing clear guidance on the proper and effective use of the solution. To date, that guidance has not been fully adopted. Any suggestion that Paragon has caused the challenges West Suburban Medical Center faces is misleading,” the statement reads. Prasad said he hopes the hospitals’ closures will be temporary. In a statement provided to the I-Team, a spokesperson for Prasad said, “West Suburban Medical Center is focused on reopening for the patients, staff, and community who depend on it. Our team is working tirelessly to recover owed revenue and resume patient care by early July.”.
https://abc7chicago.com/post/secret-meeting-held-oust-west-suburban-hospital-ceo-manaj-prasad-before-closure-oak-park-il-warnings-dire-situation/18849713/

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