U.S. Rep. Rob Bresnahan said Friday that a group of local nonprofits financially withdrew from supporting two struggling Scranton hospitals in August after months of covering Commonwealth Health Systems’ losses.
A spokesman for the foundations replied that the arrangement was for 90 days only, the foundations fulfilled their commitment, and there was no request for additional funding at that time.
As Bresnahan described it: “That's basically where the foundations came and said, ‘Listen, we've [exhausted] all of the funds that we are willing to.’ That's where the pinch point really came, that, basically, CHS was hemorrhaging cash by keeping the hospitals open."
The foundations replied in detail, as can be found later in this story.
Bresnahan also said he stepped in to put pressure on CHS to prevent a closure.
At the time, The Wright Center and Tenor Health Foundation were two potential buyers for Regional Hospital of Scranton and Moses Taylor Hospital, but neither was ready to sign an official agreement with CHS.
Officials feared CHS’s next step would be to issue a 90-day closure notice.
“The closure was imminent, dangerously close, like we were preparing for a notice at any minute of the day, and that's really where we escalated our conversations from the federal level,” Bresnahan said.
“We pulled out all the stops to make sure that all of the decision makers at CHS, which were tough to pinpoint at some point because of the amount of turnover, and who ultimately had the decision making capabilities, but that's where we pulled out the kitchen sink and threw it, and we said, this is going to be terrible for northeastern Pennsylvania. So it was dangerously close,” he added.
Efforts to reach Gov. Josh Shapiro's office and state Rep. Bridget Kosierowski were not immediately successful. A spokesperson for CHS said he was unavailable Friday.
Foundations clarify position on funding
Participating in the local funding arrangement were The Scranton Area Community Foundation, AllOne Foundation & Charities, Luzerne Foundation, Moses Taylor Foundation, NEPA Health Care Foundation, Allied Services, The Wright Center, and the Scranton Chamber of Commerce.
Charlie Lyons, a spokesperson for the organizations, issued the following statement on Friday on their behalf:
"In April of last year, CHS notified the Governor‘s Office that a hospital closing was imminent. Local foundations and other community groups, agreed to a request to support the hospital workforce by contributing funds for the hospitals’ continued operations for a period of 90 days to allow CHS more time to negotiate a potential sale of the hospitals.
"The foundations and community partners fulfilled that commitment and contributed millions of dollars to meet that request. At the end of the 90-day period, CHS continued negotiations with potential buyers, and notified the community groups through the Governor‘s Office that it would provide a 30-day notice before announcing any closure if the negotiations fell through.
"There was no request for, or discussion of, additional foundation support at that time. Since then, the situation has been fluid and much of the discussion has been around ways to support a potential purchaser of the hospital.
"It is incorrect to say that the foundations and community partners withdrew support or backed out of supporting the hospitals’ operations. Foundations continue to be engaged in discussions about how to protect the services and healthcare workforce of the hospitals."
Intervening with federal pressure to keep hospitals open
Bresnahan said he spoke with CHS leadership and federal officials, which resulted in CHS agreeing to keep the hospitals open for two additional months while they continued to search for a viable buyer.
“Obviously, acquiring a functioning hospital is significantly easier than trying to repair one that has already been shut down. We were able to work with Commonwealth Health, and convince them to keep the hospital functioning where they would be willing to cover their losses almost $2 million a month,” he said.
His team worked to keep the pressure on CHS leadership.
“It was a lot of just constant contact. We have somebody on our team who has been just utterly dedicated with daily conversations, whether it is CHS leadership, Tenor leadership, the Wright Center, Wayne Memorial, all of our local healthcare providers, and really making sure all of the information was flowing back to a central source so there wasn't any misconceptions or misinformation being construed,” Breshanan said.
“Really it was a full court press to CHS expressing the urgency," he added. "I don't want to say that we were abrasive by any means, but we certainly were very stern with where we would be in the event if they chose to pull out prematurely.”
Those conversations resulted in no funding opportunities for CHS, he said.
“Phase one was to make sure that the doors remained open,” Bresnahan said. “I didn't feel it would be prudent to advocate for financial assistance. To CHS, specifically with them, having full intentions of pulling out of Northeastern Pennsylvania, where we reserved our potential and have been in conversations with the future acquirer and what that would look like.”
“We wanted the funding, economic benefits to be with the partner who plans to be a part of our community for the foreseeable future,” he continued.
“We wanted to get this across the finish line. It wasn't about the publicity side," Bresnahan said. "It's important now to show all the work that got us here, and not just us, all of our local partners, but going out prematurely and spooking anyone that was involved in the transaction wasn't the right course of action to ultimately get a deal done.”
Where the sale of CHS hospitals stands
Tenor and CHS signed a purchase agreement in October for the two Scranton hospitals and Wilkes-Barre General Hospital, saying they expected to close the deal by year's end, subject to securing funding. Tenor sent its application to the state’s Department of Health in December.
The deal now awaits approval from the department.
"The Pennsylvania Department of Health is committed to ensuring patient safety and responsible hospital ownership throughout this process, and has received Tenor Health Foundation’s application to acquire the hospitals currently owned by Commonwealth Health Systems in Scranton and Wilkes-Barre," department spokesman Neil Ruhland said Thursday. "The Department continues to review the change-in-ownership (CHOW) application."
Bresnahan remains hopeful now that the deal is in the hands of the state.
“I'm cautiously optimistic,” he said. “The conversations, from what I understand, are still ongoing. I am cautiously optimistic. We are certainly excited to see this get across the finish line.”
“We at the federal level, will continue to aid and be of assistance, whether that means transferring provider IDs, whatever we need to do at the federal level, we are standing ready and able and having those dialogs and conversations with all the necessary powers,” he continued.
The who’s who of the CHS hospital deal
Commonwealth Health is owned by for-profit Tennessee-based Community Health Systems Inc.
Tenor Health Foundation is a nonprofit that "was formed to identify, own, manage, and turn around financially challenged hospitals,” according to its website.
Tenor's first acquisition was Sharon Regional Medical Center in Mercer County, Pennsylvania. That facility, previously under private ownership, closed last January. It reopened under Tenor's ownership in March.
Tenor is looking to purchase Regional Hospital of Scranton and Moses Taylor Hospital in Scranton, in addition to Wilkes-Barre General.
Regional and Moses Taylor operate under one license. CHS consolidated the emergency rooms at the Scranton facilities into one in 2023, effectively closing Moses Taylor’s ER operations.
Tenor’s involvement came after months of searching for a new buyer, after a previous deal with Woodbridge Healthcare, Inc. fell through in November of 2024.
