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Watsonville
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July 24, 2021

Watsonville Community Hospital owners abruptly ousted

WATSONVILLE—The company that purchased Watsonville Community Hospital two years ago—Los Angeles-based Halsen Healthcare—has been removed from a leadership role as of Jan. 18.

Los Angeles-based Prospect Medical Holdings will now run the hospital on an interim basis. The announcement came Monday via an email to hospital staff from Jeremy Rosenthal and Frank Williams, who were appointed last week as the new independent directors of WCH’s board to oversee the hospital.

Attempts to reach Rosenthal and Wiliams were not successful.

The email states that Halsen has been unable to meet “financial obligations to various stakeholders.”

“In order to ensure the stability and financial health of WCH in the near term, as well as its ability to deliver the best possible services to the Watsonville community in the long term, we and the other members of the board, with the consent and support of Medical Properties Trust, a company that has provided financing for the hospital, has directed WHC to replace Halsen Healthcare with Prospect,” the email reads.

Prospect runs 17 hospitals in five states.

Halsen purchased the hospital in late 2019 after the Pajaro Valley Community Health Trust announced they could not secure the funding to buy it.

In October, Halsen sold the building and property to Alabama-based Medical Properties Trust (MPT), and then leased it from them in a so-called sale/leaseback. 

The agreement netted roughly $39 million, which Halsen planned to use to run the hospital. 

It is not yet clear how this arrangement will be affected.

Halsen CEO Dan Brothman declined to comment for this story.

WCH nurses Roseann Faris and Quiché Rubalcava did not return several requests for comment.

PVCHT Executive Director DeAndre James did not respond directly to questions. In a prepared statement, he said that the organization is aware of the change, and said that they have offered their services to Prospect Medical Holdings. 

“As more information becomes available, we will better understand if there is a way we may be able to provide support to the hospital as they continue to provide health and wellness care for our community,” James stated.

Located on 27-acres in the heart of California’s Central Coast, the campus consists of a 106-bed, general acute care hospital and two medical office buildings totaling 323,650 square feet. The hospital has been serving the tri-county area since 1895.

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