YuLin Zhen, Photography Editor

Governor Ned Lamont urged Yale New Haven Health to finalize their decision regarding the three Prospect hospitals.  

Lamont argued that YNHH should complete its $435 million deal to buy Waterbury, Manchester Memorial and Rockville General Hospitals from Prospect Medical Holdings. The deal, announced in 2022, has already faced delays from state regulators and legal disputes between the two health systems. Recently, the deal has been further stalled in legal limbo following Prospect’s bankruptcy filing.

As uncertainty looms over the future of the hospitals, Lamont made clear that YNHH must either finalize the deal or allow other buyers to step in. 

“Yale New Haven, you want to come to the table, you want to be the lead horse on this, and if you don’t — lead, follow or get out of the way,” Lamont said at a Waterbury Regional Chamber event on Tuesday.

Prospect Medical Holdings, a private equity-backed hospital network, filed for Chapter 11 bankruptcy, rocking Connecticut’s healthcare system. The company owns and operates three critical hospitals in the state — Waterbury, Rockville and Manchester — all of which are now entangled in financial uncertainty.

Prospect’s financial strain escalated over the years, and with mounting debt, Prospect filed for bankruptcy. Prospect declined to comment on the matter, as did the three Connecticut hospitals.

The fate of the three hospitals has been further complicated by a back-and-forth legal dispute between YNHH and Prospect. Yale initially agreed to purchase the hospitals but later sued to exit the deal, citing concerns over Prospect’s alleged financial misrepresentation and hidden liabilities.

In legal filings, YNHH accused Prospect of irresponsible financial practices, including a costly cyberattack that disrupted hospital operations, ongoing federal and state healthcare violations and failure to properly maintain hospital facilities.

Prospect countersued, accusing Yale of attempting to renegotiate terms and leaking details about the litigation to the press. A Connecticut judge recently ordered Prospect to release its internal financial documents that could shed light on whether the hospital system violated acquisition agreement terms.

“I don’t blame them for trying to get a lower price,” William Pizzuto, state representative and member of Waterbury Hospital advisory boards, said of YNHH. “I think Prospect did a terrible job.”

As Prospect had filed for bankruptcy in Texas, it sought to transfer the legal battle over acquisition to Texas bankruptcy court from Connecticut state court. This would grant Prospect bankruptcy protection during the lawsuit. 

YNHH opposed this move, contending that the dispute is a contract issue, unrelated to bankruptcy proceedings, and should therefore remain in Connecticut state court. The YNHH’s lawsuit against Prospect was set for trial in April 2025, but there may now be delays.

When Deborah Weymouth, the CEO of Prospect, asked for Lamont’s comment, the governor called YNHH to act. 

Lamont predicted that the bankruptcy case could last “months, and not years.” He stated that the hospitals could also be sold to a buyer other than Yale, as two other unnamed Connecticut-based health systems have placed offers to purchase the hospitals.

Chapter 11 bankruptcy allowed all the money that the three Connecticut hospitals had been directing to Prospect to be invested into the hospitals themselves again, relieving some of the financial stress.

“Fortunately, the bankruptcy process stops that dead in its tracks, and that money now goes back into the hospitals,” Lamont said.

As a consequence of these legal back-and-forths and financial issues, many are concerned that the three hospitals cannot provide adequate care.

However, Weymouth and her team have continued reassuring patients and the public that care continues as normal.

“I can say all day long that Waterbury Hospital is safe,” State Rep. Michael DiGiovancarlo, president of the Waterbury Board of Aldermen, said. “People are losing faith in Waterbury Hospital, unfortunately. They’ve got a great crew there, great workers, but the bad press.”

Prospect Medical Holdings was established in 1996.