Scathing audit performed on shuttered Oak Park hospital thousands relied on

OAK PARK, Ill. (WLS) -- The ABC7 I-Team learned late Tuesday afternoon that a month before an Oak Park safety net hospital abruptly closed its doors, investigators working on behalf of the state performed an on-site audit with produced staggering results.

West Suburban Medical Center is a private safety net hospital that served tens of thousands of patients a year and employed more than 700 people before it suddenly shut its doors March 25.

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But more than a month before that closure, an audit performed for state officials with the Illinois Department of Healthcare and Family Services (HFS) cited a failure of hospital management.

According to the report, obtained by the I-Team through a Freedom of Information Act request, auditors performed an on-site inspection and found West Suburban was broke.

Auditors found that West Suburban Medical Center management failed to implement a new electronic medical records system and had no cash reserves, with operating expenses of $10 million per month and significant debt.

This comes as the I-Team previously reported the state poured at least $30 million into West Suburban through loans. A spokesperson for HFS told the I-Team there have been no repayments on those loans, or payments made on more than $100 million in tax debt owed by the facility.

The audit also noted "significant leadership gaps" and no "documented, realistic data-driven strategy to stabilize operations or rebuild service lines."

"Finance team lacks basic cost accounting, budgeting, and revenue cycle capability," the auditors noted.

Auditors working for the state also noted, "Leadership is unstable and overstretched, with the CEO filling multiple roles and newly hired leaders lacking experience in hospital administration."

"Decision-making is solely with the CEO [Manoj Prasad], undermining the development of a competent, strong leadership team able to plan and implement necessary financial improvement plans," the report states. "There is a board, but the depth of oversight is unclear."

One slide of the presentation lists the heading, "Strategy (Lack of)": Auditors finding there was no data-driven strategy to stabilize operations with no financial modeling, staffing plans or validated assumptions.

"There are proposed new but unvetted initiatives," auditors noted. "Unclear if and how can be successful. Actions are determined day to day."

Auditors ended the report by recommending the state request tax returns to learn more about how federal and state funds were distributed.

"Absent having audited financial statements to evaluate historical performance, and evaluate the reasonableness of 2026 budget assumptions, requesting tax returns is a sound alternative information sources," auditors noted.

It's unclear whether state officials requested copies of the facility's tax returns.

To read the state's full audit of West Suburban Medical Center, click here.

Resilience Healthcare CEO Manoj Prasad tells the I-Team West Suburban welcomed this review and cooperated with the on-site visit.

"The report confirms what we have said which is that the failed EMR system caused revenue collection issues," Prasad said through a spokesperson. "The hospital has since resumed outpatient services and is working toward a full reopening in July."

Through a spokesperson, the property owner and part-operations owner of Resilience Healthcare, Reddy Rathnakar Patlola, told the I-Team, "The State's findings reinforce what we've been saying-there is no realistic path for the current operator to safely reopen West Suburban Medical Center."

Patlola has attempted to evict Prasad over unpaid rent, which in turn led to Prasad filing a lawsuit over preserving the hospital's current management, as the I-Team previously reported.

Through a spokesperson, Patlola said, "Our focus is on securing a qualified new operator who can quickly restore care and ensure long-term stability for the community."