Westlake poised to close after bankruptcy filing

August 13, 2019 | By Michael Romain | OAK Park.COM

A bankruptcy filing on Aug. 6 and a Crain's report on Aug. 7 about an internal memo from hospital executives ordering the facility to be emptied of admitted patients, has Westlake Hospital in Melrose Park on the verge of permanently closing.

As of Saturday afternoon, however, the hospital was still open- a steady stream of patients flowing in and out of the professional building. An ambulance was parked outside of the building. And a parking lot immediately east of the building was mostly full (surrounding lots to the south and west were mostly empty).

On Aug. 6, Pipeline Health, the California-based company that has owned Westlake since January, filed for Chapter 7 bankruptcy for the hospital in U.S. Bankruptcy Court in Delaware. Pipeline officials claim that the 230-bed hospital, which treats many low-income, uninsured and/or under-insured patients, is only 20 percent utilized and is losing nearly $3 million a month.

Until that point, Pipeline had been trying for months to close Westlake in a battle that has prompted the ire of local elected officials, including Melrose Park Mayor Ron Serpico, state Rep. Emanuel "Chris" Welch (7th), state Rep. Kathleen Willis (77th) and even Cook County State's Attorney Kim Foxx.

In March, Melrose Park sued Pipeline and several of its principals, including Dr. Eric Whitaker, a prominent Chicago physician and friend of former president Barack Obama, for committing fraud and civil conspiracy while trying to purchase Westlake.

The lawsuit claims that Pipeline lied to village officials and hospital representatives about its plans to close Westlake. At the time, Pipeline called the lawsuit defamatory and false. Pipeline purchased Westlake along with West Suburban Medical Center in Oak Park and Weiss Memorial in Chicago.

In April, the Illinois Health Facilities and Services Review Board voted 7-0 to allow Pipeline Health to close Westlake, but the following month a Cook County Circuit Court judge ruled that the hospital should remain open until the village's lawsuit is resolved.

On Aug. 7, Joseph Ottolino, CEO of both Westlake and West Sub and Chapter 7 Bankruptcy Trustee Alfred T. Giuliano released a letter to hospital employees ordering all "admitted patients are to be discharged or transferred to another facility by" Friday at 3 p.m., according to a Crain's report.

That same day, the village filed a motion, which Foxx supported, to try getting the courts to hold Pipeline in contempt. On Friday, according to the Chicago Tribune, "a Cook County judge declined to rule" on the motion. Another court hearing was scheduled for Aug. 14.

"Those most affected should have been given more respect than a letter days before the hospital is set to close," Foxx wrote in a statement. "All county residents deserve access to healthcare and justice regardless of their zip code, economic status, or race. We will continue to advocate through affirmative litigation for safe, healthy communities on behalf of all citizens in Cook County."

In an Aug. 6 statement, Welch said that instead of "fulfilling promises to assist Westlake, as Pipeline's CEO Jim Edwards declared earlier this year, the for-profit company turned its back on the hospital and the largely black and brown communities that rely on it. We deserve better than this, and I will not stand by and allow a corporation to gamble with the health and well-being of our community for the sake of profit."

The bankruptcy case was taken up in a Delaware court on Aug. 13, the day this article went to press.

In January, Westlake was one of three hospitals along with West Suburban in Oak Park and Weiss Memorial in Chicago that Pipeline purchased from Tenet Healthcare for $70 million.

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