In a region already struggling to keep hospitals open, the Chicago area was at risk of losing two more — during a pandemic — when Dr. Manoj Prasad convinced state officials he was just the man to save them.
Prasad said he’d spent decades as a “servant leader” fixing struggling hospitals and clinics. He could trim budgets. Boost staff morale. Maintain quality care. And he had found a partner willing to finance it all.
All Prasad needed was for the state Health Facilities and Services Review Board to allow him and his business partner to buy West Suburban Medical Center and Weiss Memorial Hospital, both owned by the same company. The board gave them the green light.
Over the next several years, the hospitals received more than $24 million in state grants while racking up debts of roughly $100 million in state loans and unpaid taxes. Then they closed, eliminating more than 400 beds, erasing roughly 1,400 jobs and cutting neighborhood residents off from valuable medical care.
Along the way, state officials missed red flags while failing to follow rules designed to prevent something like this from happening, a Tribune investigation has found.
Records suggest the health facilities review board did little to vet Prasad and his partner before agreeing to let them take over the hospitals in Oak Park and Uptown in 2022. Then, when Prasad resurfaced with pleas for taxpayer dollars, the Department of Healthcare and Family Services handed over tens of millions in loans while doing little to track how the money was being spent.
The hospitals also received state grants from another agency, the Illinois Department of Public Health, that required them to submit third-party audits under a state law meant to ensure tax dollars are spent responsibly. There is no record of the state receiving any such audits, yet the department kept sending cash — even as its own inspectors documented the hospital buildings’ deterioration.
Meanwhile, the for-profit firm operating the hospitals, led by Prasad, broke promises to start paying back the money it owed on state loans and years of past-due taxes, while doctors and nurses increasingly complained of worsening conditions that left them worried about how they’d keep patients safe.
By mid-2025, state and federal agencies had begun losing their patience. The state demanded more information and firmer promises before it considered any more loans, while federal Medicare officials said they were so concerned about conditions at Weiss that they would stop paying for services there. Soon the Uptown hospital closed, followed some months later by West Suburban, and since then Prasad has been fighting in court with his business partner, Reddy Rathnaker Patlola, over the facilities’ future.
The hospitals’ collapse illustrates what can go wrong in a state that largely relies on — and subsidizes — the private sector to run so-called safety-net hospitals, whose leaders have long complained they make little to no money serving vulnerable patients. That’s a balancing act set to become even more difficult with looming federal cuts to Medicaid, a main income source for those hospitals.
Prasad’s partner-turned-foe is now asking a judge to enforce a settlement agreement that would remove Prasad as CEO or to appoint a receiver over the hospitals. The Patlola firm’s lawsuit initially accused Prasad of misappropriating public funds, but a judge said no evidence had been submitted to prove that. In a later filing, Patlola’s lawyers noted that nearly $2.2 million was transferred from a hospital-related account to a Prasad-tied Michigan consulting firm before the second hospital closed.
In Prasad’s correspondence with the state, and his later public statements, he has consistently portrayed himself as a well-meaning hospital management expert who took over hospitals so dysfunctional and deep in debt that — despite infusions of state cash — they couldn’t perform consistent audits, make tax remittances or pay back loans.
He said he paid himself fairly, wasted no money and remains committed to reopening both facilities. “I am fighting to prevent the much-needed community hospitals from being wiped out of existence like so many hospitals Chicago has already lost,” Prasad said in written responses to questions from the Tribune.
State officials did not respond to some of the Tribune’s questions but sent written responses defending their actions.
The health facilities board told the Tribune it approved the change in ownership based on requirements set by state law. The administration of Gov. JB Pritzker said the other agencies had to consider the benefits of maintaining healthcare for vulnerable people as well as the need for fiscal stewardship, and that it’s since beefed up oversight of grants while tightening limits on loans.
“Illinois is protecting access to care while making clear that safety-net hospitals must pay what they owe, and the State now has the expanded ability and increased authority to make sure they do,” the administration said in a statement.
Former West Suburban and Weiss workers said they watched the facilities crater under Prasad and they question why the state hasn’t dug deeper into what happened to the tens of millions his firm received.
“It’s totally unaccounted for, and to our knowledge, it’s not being looked at, at all,” Dr. George Naratadam, who worked at West Suburban, told the Tribune earlier this year. “Nothing is fixed (in the hospitals), and now we have this big healthcare gap in the area. And that money is gone.”
Handing over the keys
When Prasad and Patlola got involved with West Suburban and Weiss, they entered a segment of the healthcare industry rife with financial challenges.
Generations of demographic and economic shifts have left a group of aging hospitals in the Chicago area that serve large numbers of patients on Medicaid, which typically pays far less than private policies, and uninsured people who often cannot pay much if anything. To help these safety-net hospitals stay afloat, they get enhanced Medicaid payments, at times supplemented with grants, loans and, in some cases, taxes that go unpaid.
As a nod to the public interest in competently run hospitals, Illinois requires that those who wish to buy hospitals provide proof to the Health Facilities and Services Review Board that they’re “fit, willing and able.” When seeking to buy West Suburban and Weiss, Prasad and Patlola formed a company called Resilience Healthcare and hired a legal firm to pitch their confident plan.
The reams of paperwork the partners submitted over three months in 2022 portrayed them as near-perfect for the job.
They described Patlola as a successful East Coast entrepreneur who had access to cash and was eager to help the less fortunate. His firm would buy the properties for $92 million, then lease them to Resilience, controlled by Prasad. A Michigan-based healthcare executive and consultant, Prasad once told a podcaster he’d “perfected” reviving struggling facilities “so that in a year’s time, I can do a turnaround and stabilization.”
The application material submitted to the review board said Prasad got his medical degree in India and then pursued healthcare management in America, with his résumé listing nearly two dozen places where he held executive roles or served as a consultant. It called him “a servant leader whose skills and experience have been earned during a career resuscitating struggling healthcare organizations of all sizes, types and locations.”
The board did not answer questions from the Tribune about what it did specifically to vet Prasad’s background. Documents the Tribune obtained through a records request show board staffers did request additional information about his work history, including asking for a list of hospitals he had “turned around,” but there was no evidence of phone calls, emails or internet searches to verify the details provided.
Had they dug deeper, they could have found information that raises questions about some of Prasad’s assertions.
For example, state records show Prasad cited his time running a suburban Detroit hospital in the late 1990s as an example of his turnaround expertise. But the Tribune found a man who later bought the hospital filed a lawsuit in 2002 that alleged the previous owner had failed to disclose financial issues dating to Prasad’s tenure.
When the Tribune asked about the lawsuit, Prasad said he did turn around the hospital and contended the buyer was trying to squeeze money from the prior owner. The suit was settled before trial.
The paperwork Prasad’s team submitted also stated he “served as Executive Director of a 378-bed tertiary teaching hospital” in Flint, Michigan. That hospital, now called McLaren Flint, told the Tribune “at no time was Dr. Manoj Prasad president, CEO, or executive leader” of the hospital.
Asked about the apparent discrepancy, Prasad told the Tribune he was executive director of surgical services at the hospital, as well as overseeing orthopedic and neurological rehabilitation. Under the “clinical service line model in our industry,” he added, he was the “CEO of those service areas” and “as the ED I was not over the entire hospital but certainly over two thirds of it.” The hospital declined to comment further.
Prasad also sent the Tribune a 2002 letter from a surgeon at the Flint hospital that praised his performance as director of surgical services, as well as a 2001 letter of reference from the former owner of the suburban Detroit hospital. The latter described Prasad as “an extremely intelligent person who completed the assignment of taking the hospital from its position of substantial financial losses to a position resulting in attracting the interests of outside investors to participate in the hospital.”
Two decades later, Prasad was asking Illinois officials to trust him to work similar management magic with two hospitals then owned by Pipeline Health System.
Weiss and West Suburban, each with about 230 beds as of 2024, had already been sold twice in a decade — and Pipeline said it was continuing to lose money — when Prasad and Patlola began working to buy the hospitals.
In his 2022 pitch to the state review board, Prasad noted the hospitals’ troubles in switching to a new electronic medical record system, known in hospital lingo as EMR. Because of their role in billing, these systems are arguably the most critical business function in a hospital. Prasad told the state an EMR switchover could be “a disaster if mishandled” but he had deep IT experience, including designing such systems and “complex revenue cycle management process redesigns.”
“Let me assure you,” Prasad told the review board, “this is a problem I can fix.”
Those familiar with both hospitals know how the story ends. Three years later, Prasad’s correspondence with the state blamed another “disastrous” EMR switchover — this time on his watch — for preventing the hospitals from collecting on bills.
When the Tribune asked him how such a failure could occur given his stated expertise, Prasad wrote that his initial upgrade plan fell through, forcing him to try another vendor and then another while struggling to keep two hospitals afloat.
“Yes, I am an expert at designing and deploying EMRs, but not while I am also operating two flat-lining hospitals overseeing almost 1,400 employees,” he wrote.
Leaving aside Prasad’s professional history, records from the review board show concern that he and Patlola lacked an effective plan to turn around hospitals with twice as many liabilities as assets.
Community members wrote letters to the board expressing worry that Prasad had not proved he had the qualifications to keep the hospitals running. After a follow-up Zoom meeting with the two men, their attorneys and board staffers, board Administrator John P. Kniery summarized the issue, using capital letters, in an email sent to colleagues that the Tribune obtained through a records request.
It said: “We NEED THIS APPLICANT TO PROVIDE A PLAN TO SHOW HOW WE ARE CONNECTING THE DOTS TO TURN-AROUND THE HOSPITALS.”
Kniery did not respond to the Tribune’s questions, but the records the Tribune reviewed included no such plan. Fifteen days after his email, in June 2022, the board approved the hospital deal.
In a statement to the Tribune, the board said it examined the applications, reviewed public comments, listened to the applicants’ proposals and asked questions — but state law required it to approve the change in ownership once the application material was “deemed complete.”
When asked to clarify what power it had to decide if potential buyers were fit, willing and able — beyond them submitting the right paperwork — the board did not directly respond, instead saying it approves proposals “if the information submitted meets the requirements set forth in the law and rules.”
Sending millions
Kniery’s concerns would prove prophetic. In May of this year, Prasad acknowledged in court testimony that he and his partner “didn’t have reliable financials” when he was seeking the board’s approval. In fact, he testified, the pair didn’t start “serious due diligence” until afterward.
Only then did they discover the two hospitals were so deep in debt that no lender would offer them a loan for the purchase, according to Prasad’s testimony.
When Prasad and Patlola’s original deal with Pipeline fell through, the company looked for other buyers but said in court records that it ultimately decided to reach a new agreement with the two men. By then, Pipeline had filed for bankruptcy.
Under the new deal, which closed in December 2022 with the bankruptcy court’s approval, Prasad would run the hospitals while Patlola’s firm would pay Pipeline most of the purchase price over time, like a mortgage.
That arrangement later collapsed, leading to a series of legal battles between Pipeline, Patlola and Prasad. Patlola this month, through a representative, cited his ongoing legal dispute with Prasad as the reason he would not answer questions from the Tribune.
Not long after the deal closed, Prasad was again communicating with the state, this time about financial help.
In Prasad’s telling of events — relayed to reporters this spring at a news conference — it was the state that reached out first. He “got a very nice call” from a deputy governor who thanked him for “saving” the hospitals, and Prasad let her know the hospitals were in such debt — roughly $80 million — that he wasn’t sure how they’d “move forward,” he said.
So, according to Prasad, the deputy governor offered the hospitals $20 million in state money.
“She was very kind and said, ‘You know what? Why don’t we put an advance so that you guys can pay this down,’” Prasad recalled to assembled reporters. “And I said, ‘Look, it’s not going to be something that I can pay down and return to you. … There’s no coming back.’”
Pritzker’s office told the Tribune it had no record of such a conversation occurring.
According to records from the Department of Healthcare and Family Services, Prasad is the one who reached out in December 2022, sending a two-page letter “humbly” asking the agency for a loan of $40 million that the hospitals “would gladly pay back” starting in summer 2023. There was no mention of a conversation with a deputy governor.
Prasad also sent a three-page form on the hospitals’ finances, noting that his chief finance officer was on vacation so he did it himself. He asked the department to “kindly excuse any imperfections.”
Under the state code in effect at the time, that’s all he needed to submit, and the department gave him a $20 million loan. The agreement stated that if Prasad’s operation didn’t make required payments, the state would refuse any additional loan request.
By April 2025, Resilience had missed 12 straight payments and had not returned a dime of the loan to the state. Both hospitals also owed nearly $60 million to the state in past-due taxes and penalties.
Yet that month Healthcare and Family Services lent Weiss Hospital another $10 million.
State records show that before getting the second loan, Prasad told the state that Weiss was so in debt and strapped for cash that it could barely make payroll.
In a statement, the department told the Tribune that granting the second loan was “not an easy decision” given the money owed, but officials believed it was justified based on concern the hospital could close without financial assistance. More broadly, in a separate statement, the department said it must try to balance being a “responsible steward of public funds” while “supporting widespread healthcare access in underserved Illinois communities.”
“The goal of providing the advances was to avoid a disruption in healthcare services, and therefore harm to Medicaid customers,” the statement said.
Cash not tracked
Prasad told the state he needed the first $20 million to pay down inherited bills and the next $10 million to help Weiss bridge what he described as short-term woes surrounding the record system switchover. But he wasn’t required to prove that’s how he spent the money.
Questions about the hospitals’ spending have since emerged in the legal dispute between Prasad and Patlola.
In May, Prasad’s former chief financial officer, Irena Dumanis, testified that state loan money went into a special account that Prasad did not let her access. She also told the court he ordered her to transfer an additional $25,000 to $30,000 into the same account about every two weeks, saying it was to cover credit card payments and “supplement his payroll.”
In his responses to the Tribune, Prasad wrote that the hospitals “did not ever cover my personal expenses.” Instead, he said, because the hospitals had such poor credit, employees often used his personal credit card for hospital purchases.
Questions also remain about how much Prasad paid himself to run the hospitals. He testified in court in May that he received $90,000 a year. But the proposed legal settlement in the dispute with Patlola notes that, over three months last fall and winter, nearly $2.2 million went from that special account to a then-recently formed consulting business with the same Michigan address as Resilience.
When the Tribune asked Prasad why more than $2 million was transferred, he said it was “part of my contracted compensation due that I had not previously collected.”
Patlola, in his May testimony, said he went to state inspectors general earlier this year to share his concerns over what happened to the tens of millions in state money sent to Prasad’s operation over the years, but he’s not sure if they acted on those concerns.
“I want OIG (the Office of Inspector General) to see what’s happening with the money, and if OIG feels everything is fine, everything’s fine, I don’t care,” Patlola testified, “but … that’s the people’s money, that’s taxpayer money.”
In late May, a lawyer for Patlola’s company, Ramco Healthcare Holdings, acknowledged in court that, after digging through the hospitals’ finances, it appeared “a significant amount” of money that Ramco had previously alleged was misappropriated “went back to the hospitals.”
Healthcare and Family Services declined to respond to Tribune questions about what, if anything, has been done to track what happened to the $30 million it lent to Prasad, saying it wouldn’t comment on “ongoing litigation” even though the department is not a defendant in the case.
Unlike the loans, annual audits were required for another stream of cash the hospitals received — yearly grants awarded by the General Assembly and issued through the Illinois Department of Public Health. Records show Resilience’s hospitals got more than $24 million in grants from that department during the company’s tenure.
The audits were due each April, covering the prior fiscal year. But when the Tribune asked for records related to the grants, the department did not provide records on any audits that were turned in.
In response to Tribune questions, Prasad wrote that he submitted data to the state on how the money was spent. But he said the struggling hospitals he took over hadn’t had audits in years and their books were missing key records, which made doing timely audits much harder.
Under the state’s administrative code, the Department of Public Health must “immediately” put any recipient who fails to file an audit on a formal state “Stop Payment List” that withholds grant money until the rules are followed. Had that been done in this case, grants to Resilience would have been cut off at least as early as July 2024.
But records show the department sent more grant money to Resilience for two more fiscal years.
Not until November 2025 did the department put Resilience on the Stop Payment List, recording that it lacked timely audit reports for multiple grants stretching back at least to Resilience’s first year running the hospitals.
The department did not directly respond to Tribune questions about the delay, instead issuing a broader statement that noted in part: “Over the last three years, IDPH has implemented new standard operating procedures and restructured personnel in an effort to more effectively oversee grants.”
‘Not safe’
For roughly as long as Resilience owned West Suburban, Pamela Wade had been going to a dialysis clinic set up on the fifth floor of an adjoining building, three times a week, to keep her alive.
By 2025, though, the building’s elevators had broken down several times, forcing dialysis patients in a weakened condition to go to a different dialysis center or find an elevator in the sprawling hospital to lift them to the third floor, then make it up stairs to the fifth floor.
Wade said she did that once with the help of a staffer, taking breaks with her walker to catch her breath. “I pushed myself because I knew I needed the dialysis,” she said.
Another time, she recalled, elevators broke down during her dialysis treatment at a time she was using a wheelchair after foot surgery. She said she waited 1½ hours, then called 911 for help. She said firefighters strapped her into a special chair to carry her down the steps.
The hospital’s woes were no secret to the Department of Public Health, which — in addition to issuing grants — inspects hospitals for compliance with federal health and safety standards.
Those inspection records, along with recollections of former doctors and nurses — suggest that the problems at West Suburban went far beyond glitchy elevators. Among the concerns: Thin staffing. Unpaid bills. Broken equipment. Scarce supplies. Overflowing trash. Ignored staff complaints.
Doctors complained to the Tribune that quality-control efforts suffered under Prasad. One doctor, Vishnu Chundi, told the Tribune he quit leading West Suburban’s infection-control committee because “it became a farce, and I said I won’t be part of that farce.”
Erratic heating and air-conditioning systems also did little at times to tame Chicago’s seasonal temperature swings, leaving rooms frigid in the winter and sweltering in the summer.
“It wasn’t a safe situation, though we did go to work every day and did the best we can,” Sylvia Williams, who oversaw nurses in two departments, told the Tribune this year.
“We had fans. We had heaters. We had all sorts of things just to make sure that patients got safe care. But it was not a safe environment.”
Prasad told the Tribune that reports of problems at West Suburban were “mostly untrue and sensationalized to support a certain agenda.”
Still, when inspectors from the Department of Public Health responded to a complaint about conditions in June 2025, they found the intensive care unit at 81 degrees.
The labor and delivery section topped 85 degrees.
One floor’s inpatient wing hit 89 degrees.
And West Suburban was in better shape than Weiss. Earlier in June, many Weiss patients were evacuated to West Suburban after Weiss’ air-conditioning units failed, forcing its main building to close. A makeshift Weiss emergency room was set up in a nearby medical building with working AC, but it still “lacked critical emergency medical equipment and supplies,” state officials found. The medical director of the emergency department joined another doctor in telling state inspectors the makeshift ER simply was “not safe” for patients.
Chundi, who also had worked at Weiss, recalled “heaps of garbage” festering in the hospital’s hot hallways: “It was miserable. It was like something out of Central Africa, in a field hospital.”
Prasad told the state he was fixing the concerns at Weiss, but federal regulators had heard enough. The Centers for Medicare & Medicaid Services announced Weiss would no longer receive Medicare dollars — basically a death-knell for a hospital that relies on government funding — and Prasad closed it down last August.
Over time, Prasad and Patlola’s relationship had soured — arguing in court over who should pay for repairs and how much rent was due. Patlola later testified that he had come to doubt Prasad’s trustworthiness, saying: “It’s all lies any time.” In February of this year, Patlola met with Healthcare and Family Services to seek help in keeping West Suburban open, and the agency launched its most aggressive effort yet to assess Prasad’s management capabilities.
The department hired a team of private consultants who toured West Suburban, looked through its records and spoke with Prasad and others there. The consultants’ report to the department questioned Prasad’s management of the hospital, including his ability to fix the records systems, and found West Suburban was losing patients, still couldn’t properly bill for services and lacked a realistic plan to turn things around.
Prasad closed the Oak Park hospital a month later, in late March, then held an awkward news conference where he said he could reopen it by July. A state representative in attendance was more cautious, saying “a lot of work” was needed to open the facility and Prasad had not made the case that Prasad could pull it off by then.
Today, the hospital is still closed, as is Weiss. To try to recoup some of the money owed, the state told the Tribune it has stopped paying Medicaid claims from either hospital, withholding more than $13 million to date.
Patlola and Prasad’s companies continue to battle in a Daley Center courtroom over the hospitals’ futures. In court documents, Ramco’s attorneys have said Prasad has been stalling on finalizing an agreement in which he would allow another firm to take over, step down as CEO and earn $100,000 to work as a consultant for the hospitals for up to six months.
Court records show an attorney for Resilience has contended that Ramco is trying to include more in the deal than originally agreed upon. The judge recently agreed to allow Prasad to join the case in a personal capacity after his attorney said in a filing that Prasad “has a distinctive drive to defend himself” against “false accusations of serious misconduct.”
In response to Tribune questions, Prasad broadly blamed the legal battle for delaying West Suburban’s reopening. He said he aims to restore “all services later this year.” As for Weiss, the hospital appealed federal regulators’ decision to stop payments, and the initial appeal was dismissed, according to a document submitted to the board in July. The hospital is now “weighing its remaining options,” the document states.
If the hospitals do reopen, it will be harder for them to get any more state loans.
Under legislation pushed this year by the Pritzker administration, the Department of Healthcare and Family Services starting next year must follow stricter rules when lending money to hospitals, including a ban on new loans to any hospital that has overdue loan or tax repayments. Hospitals also must submit certain financial reports to the state each year, and if they get a state loan the department can require them to provide audits on their operations, though it’s not a must.
As for what may happen to Weiss and West Suburban, the Chicago Medical Society has joined hospital doctors in pushing the Pritzker administration to get involved. But the administration has largely remained on the sidelines, describing the hospitals as privately operated facilities that state agencies did their best to help.
For anyone still seeking care at West Suburban, a handwritten sign is taped to its main entrance, reading: “This hospital is closed. No doctors. No nurses. No clinic here.” Weeds have begun to overtake the grounds, and thick gray tape covers parts of the signs that used to direct patients.
Eight miles northeast, steps from the lakefront, are the even weedier grounds of Weiss, now closed for more than a year. Enormous banners still hang on the vacant structure, boasting of industry accolades received in better days. Closer to ground level, peeling tape on one sign reveals what’s left of the word “Emergency.”
Tribune reporter Cam’Ron Hardy contributed to this story.
