Illinois State Board Approves Sale of Olympia Fields Hospital to Prime Healthcare Despite Past Concerns
State Board Clears Deal Despite Prime Healthcare Track Record Questions
The Illinois Health Facilities and Services Review Board voted unanimously on Tuesday to approve the sale of Franciscan Health Olympia Fields hospital to Prime Healthcare for nearly $7 million. The decision came despite growing concerns from some board members and advocacy groups about Prime Healthcare's actions at other Illinois hospitals it acquired last year.
Prime Healthcare, a California-based for-profit system with more than 50 hospitals across the country, acquired eight hospitals in Illinois from Ascension last year. The Olympia Fields purchase would be the system's ninth hospital in the state.
"At its core, this transaction is about saving and improving Olympia Fields hospital, ensuring its continued role as a vital access point for the south suburbs of Chicago," said Dr. Sunny Bhatia, president and chief medical officer of Prime Healthcare.
The 214-bed hospital has been running at a loss for years, according to a state board staff report. Franciscan Health Olympia Fields lost more than $47 million in 2024 alone. Prime leaders told the board they specialize in saving struggling hospitals by reducing inefficiencies and overhead while bringing in services communities need.
Recent Closure Looms Over Discussions
The sudden closure of West Suburban Medical Center in Oak Park last month cast a shadow over the discussions. That hospital shut down abruptly in mid-March after ownership cited financial distress and a computerized billing system failure. The closure sparked community outrage and drew scrutiny to how hospitals are managed and closed.
Board members occasionally referred to the Oak Park closure as an example of how plans to save a hospital can go wrong during the Olympia Fields vote.
"We know that coming in to save and invest in distressed hospitals is a challenging business, but I'm impressed," said board member David Fox, praising Prime for stepping in to run challenged hospitals.
Board Chair Debra Savage questioned Prime's actions at the Illinois hospitals it acquired last year. Prime faced criticism from the Illinois Nurses Association after it decided to suspend inpatient pediatric care at St. Joseph Medical Center in Joliet shortly after buying the hospital.
"It also faced concerns after Mercy Medical Center in Aurora lost its designation as a Level II trauma center and after it suspended obstetrical services at St. Mary's Hospital in Kankakee," according to coverage from multiple sources.
Prime Pledges Investment Amid Skepticism
Prime Healthcare had pledged to invest $250 million in its Illinois hospitals when it purchased them from Ascension last year. Dr. Sunil Patel, chief medical officer at Prime's St. Joseph Medical Center in Joliet, expressed his connection to the area.
"I know Olympia Fields hospital is in financial distress, and I understand what is at stake if we do not get this right," Patel said. "Prime is the only system able to not only save but improve the hospital."
Bhatia told the board there is tremendous opportunity for sustaining programs at Olympia Fields, especially in behavioral health. He added: "We are continuing our diligence, and again, our emphasis always has been if there's an unmet community need, we focus on quality, safety and cost-effectiveness."
Negotiations with Blue Cross and Blue Shield Hang Over Deal
The sale announcement came amid a contract dispute between Prime Healthcare and Blue Cross and Blue Shield of Illinois, the state's largest health insurer. If an agreement is not reached by June 1, 2026, Prime will be out-of-network for people with Blue Cross and Blue Shield of Illinois health insurance.
This situation means patients would either have to find new doctors or pay more out-of-pocket for care at Prime hospitals. The current contract between Prime Healthcare and BCBSIL is set to expire on June 1, 2026.
"We are actively negotiating to ensure access to care and continuity of services for our patients," Prime Healthcare said in response to concerns.
Community Voices Express Hope and Caution
Lludid Maxinez, a nurse with St. Francis Hospital in Evanston, spoke in favor of the deal. "Things are different now that Prime Healthcare is at the helm, and none of this would be possible without their support and dedication to our staff," Maxinez said.
Bridgett Carter, with the Southland Ministerial Health Network, also expressed excitement about having Prime take over the Olympia Fields hospital.
The ACLU of Illinois previously wrote to the board asking it to carefully evaluate the transaction's effects on reproductive health care and gender-affirming care. The organization expressed concerns that Catholic hospitals typically do not offer certain services that conflict with Catholic beliefs.
Bhatia told the board that Olympia Fields would maintain its Catholic affiliation with Franciscan Alliance. With the sale, Franciscan Alliance would no longer own any hospitals in Illinois.
What Comes Next
The Illinois Health Facilities and Services Review Board's approval moves the sale forward, but Prime Healthcare still faces the challenge of negotiating its insurance contract. The outcome of those negotiations will determine whether the hospital remains accessible to the largest health insurer in Illinois after June 1, 2026.
This decision represents another chapter in Illinois healthcare consolidation, where for-profit systems acquire struggling hospitals to prevent closure but face scrutiny over their track record of maintaining essential services and community programs.
Sources:
- https://www.chicagotribune.com/2026/04/14/olympia-fields-hospital-prime-healthcare/
- https://nationaltoday.com/us/il/chicago/news/2026/04/11/8-chicago-area-hospitals-may-exit-blue-cross-blue-shield-network/