Union Leaders, Healthcare Workers Protest Private Equity Sale of Philadelphia Hospital

Sen. Bernie Sanders joined hundreds of union workers and Philadelphia community members on Thursday in decrying the planned closure of Hahnemann University Hospital, whose assets were recently put up for sale by Joel Freedman, the private equity executive who bought it last year.

The 171-year-old hospital, which has served low-income residents since before the Civil War and which tens of thousands of people rely on for their primary care, will not simply be sold to another healthcare company, but will rather go to the highest bidder, with its real estate likely being taken over to develop luxury condos and hotels in a neighborhood that's considered a "gateway location" for gentrification.

Sanders denounced the planned closing in an editorial in the Philadelphia Inquirer, while hundreds of people rallied outside the hospital.

"Since before the Civil War, Hahnemann has been an integral part of the social fabric of Philadelphia, treating underserved populations and training generation after generation of healthcare professionals," wrote Sanders and City Council member Helen Gym. "Shuttering it would result in an economic shock to the city unlike any in recent history."

Private equity firms are well-known for buying companies and selling of their assets, but the industry's entry into the healthcare sector troubles critics, especially as Freedman appears to be embarking on one of the first deals in the U.S. in which a hospital is being sold off to make way for real estate developments.

"This is pretty clearly a pure real estate deal," Eileen Appelbaum, co-director of the Center for Economic and Policy Research (CEPR), told The American Prospect. "It's very common for private equity to do this in retail, but it's not common in hospitals."

Outside the hospital, groups including PASNAP, Pennsylvania's statewide nurses union; the Philadelphia chapter of the Democratic Socialists of America; and the AFL-CIO rallied demonstrators. Former U.S. House candidate Randy Bryce, Sanders campaign co-chair Nina Turner, and Association of Flight Attendants president Sara Nelson were among the hundreds who chanted, "Keep it open!"

Nelson insisted that Freedman would not succeed in closing the hospital.

"Power concedes nothing without a demand," Turner said, quoting Frederick Douglass. "We bring a demand: keep Hahnemann open!"

Freedman's firm, Paladin Healthcare, bought Hahnemann last year. Announcing the planned sale two weeks ago, Freedman claimed Hahnemann was not "profitable."

The sale represents a deep fundamental flaw in the United States' healthcare system, Sanders said.

"The business model of America's current healthcare system is not about healing people or providing access to medical care--it is about making as much money as possible for insurance companies, drug companies, and wealthy investors." --Sen. Bernie Sanders (I-Vt.)"The business model of America's current healthcare system is not about healing people or providing access to medical care--it is about making as much money as possible for insurance companies, drug companies, and wealthy investors," the 2020 Democratic presidential candidate toldPolitico on Sunday.

"The situation in Philadelphia illustrates the entire problem," he added. "In a city with one of the highest poverty rates in the country, a major hospital serving low-income communities is on the verge of laying off 2,500 people, abandoning 500 medical residents, and closing its operations thanks to an investment firm looking to make as much money as possible in a corporate fire sale."

In the short term, said Sanders, local and state lawmakers must engage with all stakeholders to ensure Hahnemann's doors stay open.

In the long term, "we must create a Medicare for All system that would guarantee health coverage to all people," the senator wrote, to ensure that no more public hospitals are snatched up by for-profit entities and replaced by real estate developments.

Nearly two-thirds of Hahnemann's patients are black and Latino, and about 50,000 people visit its emergency room annually, using the hospital as their primary care provider. One nurse toldThe American Prospect that about 800 pregnant patients would soon need to find another hospital to deliver their babies. About half of the hospital's patients rely on Medicaid.

Hahnemann's closure, fueled by "corporate greed" represents "nothing short of a public-health emergency," PASNAP told The American Prospect.

"People will get hurt, and they will die as a direct result of this one man's action," union member and oncology nurse Dylan Toolajian told

"When you are having a stroke or a heart attack, minutes matter and having to drive another 10 minutes to get help can be a matter of life and death," added Sue Bowes, a veteran nurse at the hospital.

Union members and lawmakers are fighting the closing, fearing that if Freedman's buyers successfully develop luxury condos and hotels to replace Hahnemann, other private equity firms--or Paladin itself, which owns other hospitals--will follow by selling other public hospitals that serve low-income communities.

"If Joel Freedman wants to sell out this hospital to fill his pockets, he has to go through us first," tweeted Gym. "We're stopping that sham deal in its tracks."